New Requirements for Federal Contractors and Subcontractors

September 8, 2010

President Obama has signed Executive Order 13496, Notification of Employee Rights Under Federal Labor Law. Pursuant to this order, the Department of Labor issued its final regulations which contain important requirements for employers with federal government contracts and subcontracts. The regulations pertain to employee rights under the National Labor Relations Act and require both notice within contracts and notice to employees.
What federal contracts apply? The regulations apply to all primary government contracts that equal or exceed the simplified acquisition threshold which is currently $100,000. The regulations also apply to the subcontracts necessary to primary contracts that equal or exceed $100,000.
What are federal contractors and subcontractors required to do pursuant to these regulations? The regulations require contractors to perform in two primary ways.
First, the regulations require that all federal contracts, subcontracts, and purchase orders contain the notice provisions regarding employee rights under the National Labor Relations Act. Second, the regulations require the posting of notices pertaining to employee rights under the National Labor Relations Act at worksites. These rights include unionization, joining and assisting a union, and bargaining collectively with an employer. The notice also provides examples of unlawful conduct and information about who to contact if an employer is in violation.
The required notice must be posted wherever contracted-related activities are being performed. Additionally, if it is customary for employee notices to be sent electronically, a link to the notice must be posted and should be labeled “Important Notice About Employee Rights to Organize and Bargain Collectively with Their Employees.” Contractors with non-English speaking employees can also find posters in different languages and sizes. These posters should be posted at all worksites. Also, if employee notices are filed electronically, a link to these posters must be available and marked with the proper title. Posters must be reasonable in size and language.
What happens if contractors do not comply? Failing to comply with the notice requirements may result in revocation of the contract and debarment from future federal contracts.
If you have questions in regard to the new requirements., please contact Sara Ackermann, the author of this article, or any of the attorneys in the Employment, Benefits & Labor Relations Practice Group of Ruder Ware.

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