The Obama Administration continues to impose new obligations on government contractors. An unprecedented proliferation of Executive Orders and regulations issued by the DOL has the potential to make employment and labor law compliance unduly burdensome and prompt small and mid-sized businesses to forego federal government contracts altogether.
The latest shot recently fired by the OFCCP of the DOL changes the information that government contractors must provide initially in a compliance investigation. Among other things, specific individual compensation information must now be made available as a matter of course, preferably in electronic form for easier comparison. This action follows on the heels of OFCCP's issuance of regulations designed to set hiring benchmarks for protected veterans and individuals with disabilities. As indicated above, the President has also signed Executive Orders that do the following:
- Raise the minimum wage to $10.10 for individuals working on new federal service contracts
- Increase penalties for contractors who discriminate against or penalize employees for discussing compensation data
- Implement self-reporting obligations and monitoring responsibilities to federal contractors who have been found in violation of certain federal laws
- Extend discrimination prohibitions to include protections based on "sexual orientation" and "gender identity"
As might be expected, these Executive pronouncements present myriad questions. More than ever, government contractors may feel compelled to compromise and resolve disputed employment law issues. An adverse court judgment or administrative adjudication on the merits of an issue unrelated to government contract compliance may nonetheless trigger a reporting obligation once the relevant Executive Order becomes effective. And with increased enforcement authority, the DOL likely will become even more assertive. Contractors generally will be loath to litigate their disagreements with the DOL with debarment as an agency sword.
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