On July 31, 2014, President Barack Obama signed the Fair Pay and Safe Workplaces Executive Order, which requires prospective federal contractors to report violations of 14 federal laws and as yet unspecified state laws when bidding on service and supply contracts.  The new law will be implemented in stages starting in 2016. The Fair Pay and Safe Workplaces Executive Order will govern new federal procurement contracts valued at more than $500,000.

In solicitations for contracts covered by the Executive Order, a contractor will be required to report whether there have been any administrative merit determinations, arbitral awards or decisions, or civil judgments rendered against the contractor within the preceding three-year period for violations of the laws specified in the Executive Order.  The contractor must update this information every six months.

The following are the specified laws, the violation of which will be required to be disclosed:

  • Fair Labor Standards Act;
  • Occupational Safety and Health Act of 1970;
  • Migrant and Seasonal Agricultural Worker Protection Act;
  • National Labor Relations Act;
  • Davis-Bacon Act;
  • Service Contract Act;
  • Executive Order 11246 of September 24, 1965 (equal employment opportunity);
  • Rehabilitation Act of 1973;
  • Vietnam Era Veterans Readjustment Assistance Act of 1974;
  • Family and Medical Leave Act;
  • Title VII of the Civil Rights Act of 1964;
  • Americans with Disabilities Act of 1990;
  • Age Discrimination in Employment Act of 1967; and
  • Executive Order 13658 of February 12, 2014 (establishing a minimum wage for contractors).

The 14 covered federal statutes and equivalent state laws include those addressing wage and hour, safety and health, collective bargaining, family and medical leave, and civil rights protections.  Agencies will also require contractors to collect similar information from many of their subcontractors.

The stated purpose of the Executive Order is to ensure that the worst actors, who repeatedly violate the rights of their workers and put them in danger, don’t get contracts and thus can’t delay important projects and waste taxpayer money, while responsible contractors are protected.

The Executive Order also directs companies with federal contracts of $1 million or more not to require their employees to enter into predispute arbitration agreements for disputes arising out of Title VII of the Civil Rights Act or from torts related to sexual assault or harassment (except when valid contracts already exist) and requires contractors to give their employees information concerning their hours worked, overtime hours, pay, and any additions to or deductions made from their pay, so workers can be sure they’re getting paid what they’re owed.