Blacklisting Regulation in Final Stages; House Committee Approves Limiting Its Impact

The Department of Labor’s (DOL) proposed rule that implements President Obama’s Executive Order 13673 (EO 13673), Fair Pay and Safe Workplaces (a.k.a. "Blacklisting"), is currently being reviewed by the Office of Management and Budget (OMB), which is typically the last stage before a rule goes final. Under the rule, contractors would be required to report violations on a wide array of labor, employment, and “state equivalent” laws taking place in the past three years for contracts exceeding $500,000. Once awarded the contract, a company would be required to update this information every six months for the life of the contract. Subcontractors, whose value of the contract exceeds $500,000, would have to do the same, but they must go through the prime contractor. Contractors could ultimately be deemed not responsible and lose out on federal contracts without due process based on reports and judgments by contracting officers.

In late April, the House Armed Services Committee voted to prohibit the EO 13673 from applying to the Department of Defense (DOD) and the National Nuclear Security Administration (NNSA). The amendment was offered by Rep. John Kline (R-MN) and Rep. Joe Wilson (R-SC) during a markup of the National Defense Authorization Act for 2017 (NDAA). The focus now moves to the Senate Armed Services Committee, where a similar amendment may be introduced. The NDAA is considered a "must pass" bill and has never been vetoed. IEC submitted comments last summer urging the DOL to remove this rule from consideration.