Daily Labor Report® is the objective resource the nation’s foremost labor and employment professionals read and rely on, providing reliable, analytical coverage of top labor and employment...
By Ben Penn
Oct. 7 — The Associated Builders and Contractors filed a lawsuit in federal court to block the administration’s Fair Pay and Safe Workplaces rules requiring federal contractors to disclose labor violations ( Associated Builders and Contractors of Se. Texas v. Rung, E.D. Tex., No. 1:16-cv-00425, 10/7/16 ).
The trade group alleges President Barack Obama’s executive order and its implementing regulations exceed the government’s procurement authority, violate the Federal Arbitration Act and are preempted by the National Labor Relations Act and other labor and employment laws. ABC is seeking injunctive relief from the U.S. District Court for the Eastern District of Texas.
The Fair Pay and Safe Workplaces regulation and guidance require federal contractors and subcontractors to disclose violations of 14 federal labor and employment laws, and state-law equivalents, when bidding on a contract. The rule was finalized in August and is set to take effect in gradual stages, starting Oct. 25 with prime contracts valued at $50 million or more.
The rule is the latest in a series of Obama administration regulations to face litigation in Texas from the business community. More lawsuits are expected over the regulation, which contractors refer to as “blacklisting.” They’ve called it a compliance headache and unnecessary because of existing debarment procedures.
The case was assigned to Judge Marcia A. Crone.
The plaintiffs, ABC and the National Association of Security Corporations, are suing on behalf of their government contractor members.
The litigants also charged the government with violating contractors’ due process rights by allowing contracting officers to make determinations based on companies’ alleged violations that haven’t been fully adjudicated.
The executive order, rule and guidance “thereby deprive government contractors of their liberty interests without due process of law,” violating the constitution, the ABC argues. “Such harm is irreparable in nature and is both imminent and certain, calling for injunctive relief.”
The same provision of the executive order that requires contractors to report mere allegations also infringes on companies’ First Amendment rights by coercing speech, the lawsuit alleges.
The plaintiffs further accused the administration of issuing a regulation that is “arbitrary and capricious” under the Administrative Procedure Act.
The Fair Pay and Safe Workplaces rule “creates additional costs and regulatory burdens that will discourage qualified firms, particularly small businesses, from pursuing federal contracts, and will drive up costs to taxpayers,” Ben Brubeck, ABC’s vice president of regulatory, labor and state affairs, said in a statement. “In addition, it will cause litigation and delays that will disrupt the federal procurement process for critical goods and services purchased by the government.”
The named defendants include the top officials at the Labor Department and the Federal Acquisition Regulatory Council, which issued the guidance and rules.
Representatives for the DOL and FAR Council were not immediately available for comment.
Littler Mendelson P.C. is representing the plaintiffs.
To contact the reporter on this story: Ben Penn in Washington at email@example.com
To contact the editor responsible for this story: Peggy Aulino at firstname.lastname@example.org
The lawsuit is at http://src.bna.com/jfV.
Copyright © 2016 The Bureau of National Affairs, Inc. All Rights Reserved.
All Bloomberg BNA treatises are available on standing order, which ensures you will always receive the most current edition of the book or supplement of the title you have ordered from Bloomberg BNA’s book division. As soon as a new supplement or edition is published (usually annually) for a title you’ve previously purchased and requested to be placed on standing order, we’ll ship it to you to review for 30 days without any obligation. During this period, you can either (a) honor the invoice and receive a 5% discount (in addition to any other discounts you may qualify for) off the then-current price of the update, plus shipping and handling or (b) return the book(s), in which case, your invoice will be cancelled upon receipt of the book(s). Call us for a prepaid UPS label for your return. It’s as simple and easy as that. Most importantly, standing orders mean you will never have to worry about the timeliness of the information you’re relying on. And, you may discontinue standing orders at any time by contacting us at 1.800.960.1220 or by sending an email to email@example.com.
Put me on standing order at a 5% discount off list price of all future updates, in addition to any other discounts I may quality for. (Returnable within 30 days.)
Notify me when updates are available (No standing order will be created).
This Bloomberg BNA report is available on standing order, which ensures you will all receive the latest edition. This report is updated annually and we will send you the latest edition once it has been published. By signing up for standing order you will never have to worry about the timeliness of the information you need. And, you may discontinue standing orders at any time by contacting us at 1.800.372.1033, option 5, or by sending us an email to firstname.lastname@example.org.
Put me on standing order
Notify me when new releases are available (no standing order will be created)