Doing business with the federal government -- directly or indirectly -- usually comes with strings attached.
Here at Affirmative Action Edition, we focus mostly on the affirmative action obligations of federal contractors, but government contracts typically include other employment-related requirements. Each contract is different, so companies need to read the fine print closely to determine what applies and when. Here are some examples, though, of what signing on that dotted line may oblige your organization to do:
Paid sick leave: Some contractors have to provide up to 7 days of paid sick leave for covered employees.
Federal contractor minimum wage: Some contractors are required pay a higher minimum wage to covered employees.
Code of business & ethics: Covered contractors must create and disseminate a policy addressing their code of business and ethics.
Reporting executive compensation: Covered contractors must report to the government the names and total compensation of each of the five most highly compensated executives for the contractor’s preceding completed fiscal year. In addition, unless otherwise directed by the government contracting official, contractors must report the names and total compensation of the five most highly compensated executives for the first-tier subcontractors’ preceding completed fiscal year.
E-Verify: Most contractors are required to use the federal Employment Eligibility Verification system to confirm the employment eligibility of new hires and all employees assigned to work on the covered contract.
Notification of rights under the NLRA: Most contractors must post a notice informing employees of their various rights under the National Labor Relations Act.
Privacy training: Contractors dealing with “personally identifiable information” on behalf of a federal agency must provide privacy training to employees.
VETS-4212 reporting: Covered contractors must report to the Veterans’ Employment & Training Service each year on the number of protected veterans employed and hired during the past 12 months.
Of course, there are many other clauses that could be included in a government contract or subcontract. If your organization is doing business with the federal government, or thinking about doing business with the federal government, we recommend that the contract clauses be reviewed carefully and that mechanisms be implemented to ensure compliance with the various requirements.