The 2015 amendments to the anti-trafficking provisions in the Federal Acquisition Regulation will apply to all federal contracts and subcontracts awarded after March 2, 2015. Existing IDIQ contracts for which additional orders are anticipated will be modified “on a bilateral basis” to include the new language in FAR 52.222-50. See 80 Fed. Reg. 4967 (Jan. 29, 2015). The changes implement the requirements outlined in Executive Order 13627 (Sept. 25, 2012) and the anti-trafficking provisions of the 2013 National Defense Authorization Act, Public Law No. 112-239 (Jan. 2, 2013), codified in 22 U.S.C. Chapter 78.
Here we present some of the background on the original FAR clause and a summary of the new requirements. A redline version of the 2015 amendments to FAR 52.222-50 is available here.
The original FAR language on human trafficking
A contract clause prohibiting severe forms of human trafficking, procurement of commercial sex acts, and the use of forced labor has appeared in federal service contracts since April 2006. See 71 Fed. Reg. 20301 (Apr. 19, 2006) [pdf]. The 2006 version of the anti-trafficking clause included a general prohibition applicable to federal service contractors and a requirement to establish policies and procedures to ensure employee compliance. It required contractors to notify employees of the policy and to establish an appropriate employee awareness program. It required contractors to notify the government of an alleged violation and specified penalties for human trafficking violations. The original interim version of FAR 52.222-50 was also a mandatory flowdown in all subcontracts for the acquisition of services.
FAR 52.222-50 was expanded in 2007 to cover all federal contracts and subcontracts, including those for supplies and for commercial items. See 72 Fed. Reg. 46335 (Aug. 7, 2007). The clause was revised again in January 2009. See 74 Fed. Reg. 2741 (Jan. 15, 2009). The main substantive addition at that time was the addition of language making it clear that a contracting officer could consider the adoption of a Trafficking in Persons awareness program as a mitigating factor in determining the appropriate remedy for a trafficking violation.
The 2015 FAR amendments
The 2015 amendments to FAR Subpart 22.17 and FAR 52.222-50 go well beyond the original requirements. They introduce a list of specific types of conduct that had not previously appeared in the clause. They add a requirement for many contractors to implement trafficking compliance plans and to certify the absence of any trafficking activities every year. They also modify the mandatory disclosure obligations and specify the minimum level of cooperation required of contractors responding to a trafficking investigation. Finally, the amendments to the FAR clause expand the list of contracting relationships subject to the anti-trafficking clause.
1. Expanded list of prohibited conduct
In addition to the existing prohibition against severe forms of human trafficking, procurement of commercial sex acts, and the use of forced labor in the performance of government contracts, the amendments include six new prohibited activities. They appear in paragraphs four to nine of FAR 52.222-50(b):
- Contractors and subcontractors may not “[d]estroy, conceal, confiscate, or otherwise deny access by an employee to the employee’s identity or immigration documents, such as passports or drivers’ license, regardless of issuing authority.” FAR 52.222-50(b)(4).
- Contractors may not “[u]se misleading or fraudulent practices during the recruitment of employees or offering of employment . . . .” or “[u]se recruiters that do not comply with local labor law of the country in which the recruiting takes place.” FAR 52.222-50(b)(5).
- Contractors may not “[c]harge employees recruitment fees.” FAR 52.222-50(b)(6).
- In some circumstances, contractors may not “[f]ail to provide return transportation or pay for the cost of return transportation upon the end of employment.” FAR 52.222-50(b)(7).
- Contractors may not “[p]rovide or arrange for housing that fails to meet the host country housing and safety standards.” FAR 52.222-50(b)(8).
- Finally, contractors may not “[f]ail to provide an employment contract, recruitment agreement, or other required work document in writing” if they are separately required to do so by law or by contract. FAR 52.222-50(b)(9). A written work document must be provided at least five days before the employee relocates. It must be in a language the employee understands and contain “details about work description, wages, prohibition on charging recruitment fees, work location(s), living accommodations and associated costs, time off, roundtrip transportation arrangements, grievance process, and the content of applicable laws and regulations that prohibit trafficking in persons.” FAR 52.222-50(b)(9).
2. Changes in reporting requirements
The 2015 amendments to FAR 52.222-50(b) also modify the requirement to report allegations of trafficking to the federal government. The amended language limits the contractor’s reporting obligation to “credible information,” but it requires that any reports be made not just to the contracting officer, but to the agency Inspector General. FAR 52.222-50(d). Under the 2006 language, contractors were required to report “any information” containing allegations of human trafficking to the contracting officer.
New language in paragraph (d) also expressly requires cooperation with a government investigation of trafficking. Contractors are required to provide the agency Inspector General with “information sufficient to identify the nature and extent of an offense and the individuals responsible for the conduct.” They are required to provide “timely and complete responses” to requests for documents and “reasonable access to [contractor] facilities and staff . . . . ” and to “[p]rotect all employees suspected of being victims or witnesses to prohibited activities. . . . ” FAR 52.222-50(g)(1).
Notably, the 2015 amendments also make it clear that the cooperation requirement does not foreclose any available contractor rights. It expressly preserves the contractor’s right to conduct an internal investigation relating to human trafficking allegations and the availability of the contractor’s attorney-client privilege and work product protections. It also expressly preserves attorney-client privilege and Fifth Amendment protections for individual officers, directors, employees, owners, and agents. FAR 52.222-50(g)(2). Given the issues presented by human trafficking and the significant negative consequences that may arise from allegations that trafficking has occurred, these protections will prove important.
3. Compliance plan and annual certification requirements
The 2015 amendments also include language requiring many federal contractors and subcontractors to implement a human trafficking compliance plan. See FAR 52.222-50(h). A compliance plan is required for any portion of a contract with an estimated value in excess of $500,000 for supplies acquired outside the United States or for services performed outside the United States. While contractors furnishing commercially available off-the-shelf items (COTS items) may not engage in trafficking activities, the clause exempts them from the requirement to implement a formal trafficking compliance plan.
The requirements of each trafficking compliance plan will vary. Under the new FAR language, a human trafficking compliance plan must be “appropriate” to the “size and complexity of the contract” and to the “nature and the scope of the activities to be performed.” But the amended language in FAR 52.222-50 identifies five items identified as “minimum requirements.” Under FAR 52.222-50(h), a satisfactory compliance plan must include: (i) an awareness program; (ii) an employee reporting process; (iii) a recruiting and wage plan that addresses the restrictions on recruiting fees; (iv) a housing plan that ensures minimum housing and safety standards for employees; and (v) procedures to prevent trafficking activities by agents and subcontractors. The contractor is required to post relevant contents of the compliance plan at the workplace and on any contractor website or to provide a copy of the plan to each worker. Upon request, the contractor must provide a copy of the plan to the contracting officer.
This compliance plans required in the new FAR clause cannot be prepared once and filed away in a drawer. On an annual basis, contractors are required to submit a certification that they have implemented an appropriate compliance plan, that they have conducted due diligence to identify and prevent any prohibited activities, and that no prohibited activities have occurred or that appropriate remedial or referral action has been taken.
4. Importance of compliance as a mitigating factor
Significantly, the 2015 amendments to FAR 52.222-50 make it clear that simply adopting an awareness program is not enough to mitigate contractor liability for a trafficking violation. Under the new language in FAR 52.222-50(f), a compliance plan may be considered a mitigating factor only if the contractor (a) had the plan in place at the time of the violation; (b) was in compliance with the plan; and (c) took appropriate remedial actions to address the violation, including making reparation to victims. FAR 52.222-50(f). The 2009 version of FAR 52.222-50 permitted the contracting officer to consider merely the adoption of a Trafficking in Persons awareness program as a mitigating factor.
5. Recruiting agents now included
One final noteworthy addition to the FAR anti-trafficking provisions is the language expanding its applicability to contractor “agents.” Previously, FAR 52.222-50 was required for all federal contracts and was a mandatory flowdown in subcontracts at any tier. But it was not expressly applicable to agents. The revised language makes it clear that contractor agents are subject to the requirements of the contract clause.