Federal Contractor Obligations Regarding Employee Rights Under the National Labor Relations Act

We all need help staying up-to-date on evolving rules for Davis-Bacon compliance. While the Davis Bacon law has no doubt resulted in lucrative public works opportunities for contractors, it is not without its regulatory land mines! With that in mind, Jeff VanderWal has drafted a review of new guidelines that will directly affect all prevailing wage contractors working on a federal Davis-Bacon job!

On June 21, 2010, Department of Labor (“DOL”) regulations requiring federal contractors and subcontractors to post notices informing employees of their rights under the National Labor Relations Act (“NLRA”) became effective. (29 CFR part 471.)  The required notice, “Employee Rights Under the National Labor Relations Act,” informs employees of their rights to organize and bargain collectively concerning wages, hours and other terms and conditions of employment.  The notice also informs employees of their rights to join a union, strike and picket, to take action with co-workers to improve working conditions by raising work-related complaints with their employer or a government agency, and to seek help from a union.  The Regulations were drafted to implement Executive Order 13496 which was signed by President Obama on January 30, 2009.  The text of Regulations is available on the DOL’s web site. (www.dol.gov/olms/regs/compliance/EO13496.htm)

            The notices must be posted in conspicuous places in a contractor’s plants and offices where employees covered by the NLRA engage in activities relating to the performance of a federal contract, including all places where notices to employees are customarily posted.  Where a significant portion of employees is not proficient in English, the notice must be provided in a language the employees speak.  The notice is available in either 11×17 (1 page) or 8½x11 (2 page) formats at the DOL web site above.

Contractors that electronically post notices for employees must also provide access to the required notice electronically. This requirement may be satisfied by prominently displaying a link to the DOL’s web site that contains the full text of the poster on any web site maintained by the contractor that is used for notices about terms and conditions of employment. The link must read, “Important Notice about Employee Rights to Organize and Bargain Collectively with Their Employers.”  Just as with the physical postings, where a significant portion of a contractor’s workforce is not proficient in English, the contractor must also provide electronic notice in the language employees speak. If necessary, the DOL Office of Labor-Management Standards (“OLMS”) will provide translations of the link that must be displayed.

Government contracting departments and agencies must also include a specific reference to an “Employee Notice Clause” in most types of Government contracts.  The “Employee Notice Clause” is essentially a new contract term requiring contractors to post the required notice in plants and offices where employees covered by the NLRA engage in activities relating to the performance of the contract.  The complete “Employee Notice Clause” is rather long and does not have to be quoted verbatim in the contract.  Instead, the “Employee Notice Clause” may be made part of the contract, subcontract, or purchase order by citation to “29 CFR part 471, appendix A to subpart A.”  Contractors and subcontractors are required to include the additional clause in all subcontracts.

The additional language does not have be included in collective bargaining agreements, contracts for purchases under the simplified acquisition threshold under the Office of Federal Procurement Policy Act, subcontracts of $10,000 or less, and contracts performed outside the territorial United States.  Specific contracts may also be exempted by the Director of the OLMS where the inclusion of the language would impair the ability of the Government to procure goods or services on an economical and efficient basis, or where special circumstances require the exemption to serve the national interest.

Violations of the Regulations may result in administrative enforcement proceedings. Violations may be determined based on a compliance evaluation, the results of a complaint investigation, or a contractor’s refusal to cooperate with an evaluation or investigation.  A contractor’s refusal to take appropriate action with respect to a subcontract, and a subcontractor’s refusal to adhere to the Regulations regarding the employee notice or inclusion of the prescribed contract clause in its subcontracts, may also be a violation.

If a contractor is found to be in violation of posting requirements, it may have its contract cancelled, terminated, or suspended.  The contractor may also be debarred and unable to enter into further contracts, or extensions or other modifications of existing contracts.  The OLMS will also distribute a list of the names of contractors and subcontractors that have failed to comply with the Regulations and orders of the Secretary of Labor, and, as a result, have been declared ineligible for future contracts.

All contractors and subcontractors that perform federal work are advised to access the required “Employee Rights Under the National Labor Relations Act” notice and post it at their principal office and all federal work sites.  Contractors should also confirm that Governmental contracting departments and agencies incorporate the required additional language concerning the “Employee Notice Clause” in future contracts.