PRESIDENT OBAMA’S EXECUTIVE ORDERS TARGET OPEN SHOP CONTRACTORS  (02/04/2009)

President Obama Jan.30 issued three executive orders establishing new labor requirements for government contractors that target open shop contractors.  

The first order repeals Executive Order 13201, or Beck Order, that required contractors to inform employees of their rights in refusing to pay union dues earmarked for non-collective bargaining activities, including politics and lobbying.  In addition, the new order mandates that most federal contractors and subcontractors post and comply with a notice informing employees of their rights under federal labor laws or face consequences that could include losing the contract and being blacklisted from future projects.  This order is effective immediately, although the Secretary of Labor has 120 days to initiate a process to determine the form and content of the rule.  

The president also issued an executive order prohibiting federal contractors from being reimbursed for costs associated with educating employees about joining a union, including preparing and distributing materials; hiring or consulting legal counsel; holding meetings; and activities planned or conducted by managers, supervisors or union representatives during work hours.  The Federal Acquisition Regulatory Council must enact this rule within 150 days.  

The third executive order mandates that service contracts covered by the Service Contract Act include a clause requiring contractors to offer workers employed under a previous contract the right of first refusal for non-managerial and non-supervisory positions they are qualified for.  Penalties for not complying with this order include paying back wages and the possibility of a three-year debarment from federal contracts.  The Secretary of Labor must issue regulations within 180 days.   

Although the executive orders raise a number of concerns for ABC and its members, the extent of their impact on ABC members will be unclear until the regulations implementing the orders are proposed.  ABC will participate in the rulemaking processes for each order, and will provide timely updates on these and other executive orders issued by the Obama administration.  

Executive Order 13495: Notification of Employee Rights Under Federal Labor Laws 

Executive Order 13496: Economy in Government Contracting

Executive Order 13497: Nondispacement of Qualified Workers Under Service Contracts