[Federal Register Volume 69, Number 243 (Monday, December 20, 2004)]
[Rules and Regulations]
[Pages 76352-76355]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 04-27636]


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DEPARTMENT OF DEFENSE

GENERAL SERVICES ADMINISTRATION

NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

48 CFR Parts 2, 22, and 52

[FAC 2001-26; FAR Case 2004-010; Item IV]
RIN 9000-AK04


Federal Acquisition Regulation; Notification of Employee Rights 
Concerning Payment of Union Dues or Fees

AGENCIES: Department of Defense (DoD), General Services Administration 
(GSA), and National Aeronautics and Space Administration (NASA).

ACTION: Interim rule with request for comments.

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SUMMARY: The Civilian Agency Acquisition Council and the Defense 
Acquisition Regulations Council (Councils) have agreed on an interim 
rule amending the Federal Acquisition Regulation (FAR) to implement 
Executive Order 13201, Notification of Employee Rights Concerning 
Payment of Union Dues or Fees. The rule requires Government contractors 
and subcontractors to post notices, in all plants and offices, whether 
or not used in performing work that supports a Federal contract, 
informing their employees that under Federal law they cannot be 
required to join a union or maintain membership in a union to retain 
their jobs. The required notice also advises employees who are not 
union members that they can object to the use of their union dues for 
certain purposes.

DATES: Effective Date: December 20, 2004.
    The Department of Labor's final rule implementing Executive Order 
13201 was published on March 29, 2004, with an effective date of April 
28, 2004. This rule amending the FAR is the formal notification to 
contracting officers to insert the Executive Order 13201 clause in 
covered solicitations issued on or after the effective date of this 
rule.
    Comment Date: Interested parties should submit comments to the FAR 
Secretariat at the address shown below on or before February 18, 2005 
to be considered in the formulation of a final rule.

ADDRESSES: Submit comments identified by FAC 2001-26, FAR case 2004-
010, by any of the following methods:
     Federal eRulemaking Portal: http://www.regulations.gov. 
Follow the instructions for submitting comments.
     Agency Web Site: http://www.acqnet.gov/far/ProposedRules/proposed.htm. Click on the FAR case number to submit comments.
     E-mail: [email protected]. Include FAC 2001-26, FAR 
case 2004-010 in the subject line of the message.
     Fax: 202-501-4067.
     Mail: General Services Administration, Regulatory 
Secretariat (VIR), 1800 F Street, NW, Room 4035, ATTN: Laurie Duarte, 
Washington, DC 20405.
    Instructions: Please submit comments only and cite FAC 2001-26, FAR 
case 2004-010, in all correspondence related to this case. All comments 
received will be posted without change to http://www.acqnet.gov/far/ProposedRules/proposed.htm, including any personal information 
provided.

FOR FURTHER INFORMATION CONTACT: The FAR Secretariat at (202) 501-4755 
for information pertaining to status or publication schedules. For 
clarification of content, contact Mr. Craig Goral, Procurement Analyst, 
at (202) 501-3856. Please cite FAC 2001-26, FAR case 2004-010.

SUPPLEMENTARY INFORMATION:

A. Background

    On April 13, 1992, President George H. W. Bush issued Executive 
Order (E.O.) 12800. E.O. 12800 required unionized Federal contractors 
to post a notice in the workplace that workers are

[[Page 76353]]

not required to join or support a union and threatened sanctions 
against contractors who did not comply. The next month, the Councils 
issued an interim rule implementing E.O. 12800 (57 FR 20373-20375, May 
12, 1992).
    However, E.O. 12800 was revoked on February 1, 1993, by President 
Clinton's E.O. 12836 (58 FR 7045, February 3, 1993). On March 2, 1993, 
the Councils issued a final rule (58 FR 12140) eliminating the interim 
rule.
    On February 17, 2001, President George W. Bush issued E.O. 13201 
(66 FR 11221, February 22, 2001). This Executive order revoked 
President Clinton's E.O. 12836 and reasserts the notification 
provisions and sanctions of E.O. 12800.
    On October 1, 2001, the Department of Labor (DoL) published a 
proposed rule implementing E.O. 13201 (66 FR 50010). DoL finalized its 
implementing rule on March 29, 2004 (69 FR 16376).
    E.O. 13201 is designed to promote economy and efficiency in 
Government procurement due to a better-informed American workforce. 
E.O. 13201 contains requirements similar, but not identical, to those 
in E.O. 12800.
    The interim rule amends the FAR to--
     Provide a new FAR subpart on Notification of Employee 
Rights Concerning Payment of Union Dues or Fees;
     Add a clause at 52.222-39 to be included in every 
solicitation and contract, other than purchases that do not exceed the 
simplified acquisition threshold and contracts covered by an exemption 
granted by the Secretary of Labor. The new clause applies to contracts 
(commercial or non-commercial) and subcontracts (commercial or non-
commercial) that exceed the simplified acquisition threshold;
     Amend the clause at 52.212-5, Contract Terms and 
Conditions Required to Implement Statutes or Executive Orders--
Commercial Items, in order to include the new 52.222-39 clause; and
     Amend the clause at 52.244-6, Subcontracts for Commercial 
Items, in order to include the new 52.222-39 clause.
    This is not a significant regulatory action and, therefore, was not 
subject to review under Section 6(b) of Executive Order 12866, 
Regulatory Planning and Review, dated September 30, 1993. This rule is 
not a major rule under 5 U.S.C. 804.

B. Regulatory Flexibility Act

    The interim rule is not expected to have a significant economic 
impact on a substantial number of small entities within the meaning of 
the Regulatory Flexibility Act, 5 U.S.C. 601, et seq., because the rule 
merely requires contractors to post notices and to insert a clause in 
subcontracts and purchase orders requiring subcontractors and vendors 
to post the notices also. The notices advise the contractors' and 
subcontractors' nonunion member employees of their rights under 
existing law concerning use of their union dues or fees where a union 
security agreement is in place. The rule provides sanctions for 
noncompliance, but full compliance with the Executive order and any 
related rules, regulations, and orders of the Secretary of Labor is 
expected of all contractors. Further, this interim rule is only 
implementing the DoL final rule. The Secretary of Labor has certified 
to the Chief Counsel for Advocacy at the Small Business Administration 
that the DoL final rule will not substantially change existing 
obligations for Federal contractors. Therefore, an Initial Regulatory 
Flexibility Analysis has not been performed. The Councils will consider 
comments from small entities concerning the affected FAR Parts 2, 22, 
and 52 in accordance with 5 U.S.C. 610. Interested parties must submit 
such comments separately and should cite 5 U.S.C 601, et seq. (FAC 
2001-26, FAR case 2004-010), in correspondence.

C. Paperwork Reduction Act

    The Paperwork Reduction Act (Pub. L. 104-13) applies because the 
interim rule contains information collection requirements; however, 
this rule's changes do not impose additional information collection 
requirements to the paperwork burden previously submitted to the Office 
of Management and Budget (OMB) and approved on November 15, 2004, under 
OMB Control Number 1215-0203. The DoL has identified the burdens 
associated with the filing and processing of complaints by complainants 
and contractors in the notice of final rulemaking at 69 FR 16376, March 
29, 2004. The Councils believe that the package submitted by DoL meets 
the requirement imposed by the Paperwork Reduction Act and sufficiently 
covers this interim rule and no further action is necessary.

D. Determination to Issue an Interim Rule

    A determination has been made under the authority of the Secretary 
of Defense (DoD), the Administrator of General Services (GSA), and the 
Administrator of the National Aeronautics and Space Administration 
(NASA) that urgent and compelling reasons exist to promulgate this 
interim rule without prior opportunity for public comment. This action 
is necessary to implement Executive Order 13201 and the DoL rule at 29 
CFR part 470 effective April 28, 2004. However, pursuant to Public Law 
98-577 and FAR 1.501, the Councils will consider public comments 
received in response to this interim rule in the formation of the final 
rule.

List of Subjects in 48 CFR Parts 2, 22, and 52

    Government procurement.

    Dated: December 9, 2004.
Laura Auletta,
Director, Contract Policy Division.

0
Therefore, DoD, GSA, and NASA amend 48 CFR parts 2, 22, and 52 as set 
forth below:
0
1. The authority citation for 48 CFR parts 2, 22, and 52 is revised to 
read as follows:

    Authority: 40 U.S.C. 121(c); 10 U.S.C. chapter 137; and 42 
U.S.C. 2473(c).

PART 2--DEFINITIONS OF WORDS AND TERMS

0
2. Amend section 2.101 in paragraph (b)(2) in the definition ``United 
States'' by redesignating paragraphs (4) and (5) as (5) and (6), 
respectively, and adding a new paragraph (4) to read as follows:


2.101  Definitions.

* * * * *
    (b) * * *
    United States, when used in a geographic sense, means the 50 States 
and the District of Columbia, except as follows:
* * * * *
    (4) For use in Subpart 22.16, see the definition at 22.1601.
* * * * *

PART 22--APPLICATION OF LABOR LAWS TO GOVERNMENT ACQUISITIONS

0
3. Add Subpart 22.16, consisting of sections 22.1600 through 22.1605, 
to read as follows:

Subpart 22.16-Notification of Employee Rights Concerning Payment of 
Union Dues or Fees

Sec.
22.1600 Scope of subpart.
22.1601 Definitions.
22.1602 Policy.
22.1603 Exemptions granted by the Secretary of Labor.
22.1604 Compliance investigations and sanctions for violations.
22.1605 Contract clause.

[[Page 76354]]

22.1600  Scope of subpart.

    This subpart prescribes policies and procedures to implement 
Executive Order 13201, February 17, 2001.


22.1601  Definitions.

    As used in this subpart--
    Secretary means the Secretary of Labor, U.S. Department of Labor.
    United States means the 50 States, the District of Columbia, Puerto 
Rico, the Northern Mariana Islands, American Samoa, Guam, the U.S. 
Virgin Islands, and Wake Island.


22.1602  Policy.

    Executive Order 13201 generally requires contractors to post a 
notice informing employees of their rights concerning payment of union 
dues or fees and to include this requirement in subcontracts and 
purchases that exceed the simplified acquisition threshold.


22.1603  Exemptions granted by the Secretary of Labor.

    (a) The Secretary may grant exemptions from the requirements of 
this subpart, including the requirement to include the clause at 
52.222-39, or parts of that clause, in contracts. Requests for 
exemptions may be submitted in accordance with Department of Labor 
regulations at 29 CFR 470.3.
    (b) The requirements of this subpart do not apply to contracts or 
subcontracts or purchases that do not exceed the simplified acquisition 
threshold.


22.1604  Compliance investigations and sanctions for violations.

    The Secretary may investigate any contractor, subcontractor, or 
vendor to determine if any of the requirements of the clause at 52.222-
39 have been violated. The procedures for conducting the investigations 
and effecting the sanctions are in 29 CFR part 470, Subpart B--
Compliance Evaluations, Complaint Investigations and Enforcement 
Procedures. If the Secretary determines that there has been a 
violation, the Secretary may, to the extent authorized by 29 CFR 470.14 
(which, in part, requires coordination between the head of the agency 
and the Secretary), direct that the contract be cancelled, terminated, 
or suspended in whole or in part. The Secretary may also declare the 
contractor ineligible for further Government contracts. Each 
contracting agency shall cooperate with the Secretary and provide such 
information and assistance as the Secretary may require in the 
performance of the Secretary's functions.


22.1605  Contract clause.

    Insert the clause at 52.222-39, Notification of Employee Rights 
Concerning Payment of Union Dues or Fees, in all solicitations and 
contracts, except--
    (a) Acquisitions that do not exceed the simplified acquisition 
threshold. For indefinite quantity contracts, include the clause only 
if the value of orders in any calendar year of the contract is expected 
to exceed the simplified acquisition threshold; or
    (b) Contracts covered by an exemption granted by the Secretary of 
Labor. A contracting agency may modify the clause at 52.222-39, if 
necessary, to reflect an exemption granted by the Secretary (see 
22.1603(a)).

PART 52--SOLICITATION PROVISONS AND CONTRACT CLAUSES

0
4. Amend section 52.212-5 by--
0
a. Revising the date of the clause;
0
b. Redesignating paragraphs (b)(21) through (b)(34) as (b)(22) through 
(b)(35), respectively, and adding a new paragraph (b)(21);
0
c. In the introductory text of paragraph (e)(1), by removing 
``paragraphs (i) through (vi)'' and adding ``paragraphs (i) through 
(vii)'' in its place; and redesignating paragraphs (e)(1)(v) and 
(e)(1)(vi) as (e)(1)(vi) and (e)(1)(vii), respectively, and adding a 
new paragraph (e)(1)(v) to read as follows:


52.212-5  Contract Terms and Conditions Required to Implement Statutes 
or Executive Orders--Commercial Items.

* * * * *

CONTRACT TERMS AND CONDITIONS REQUIRED TO IMPLEMENT STATUTES OR 
EXECUTIVE ORDERS--COMMERCIAL ITEMS (DEC 2004))

* * * * *
    (b) * * *
    ----(21) 52.222-39, Notification of Employee Rights Concerning 
Payment of Union Dues or Fees (DEC 2004) (E.O. 13201).
* * * * *
    (e)(1) * * *
    (v) 52.222-39, Notification of Employee Rights Concerning Payment 
of Union Dues or Fees (DEC 2004) (E.O. 13201).
* * * * *


52.213-4  [Amended]

0
5. Amend section 52.213-4 by removing from the clause heading ``(Oct 
2004)'' and adding ``(DEC 2004)'' in its place; and removing ``(July 
2004)'' from paragraph (a)(2)(vi) of the clause and adding `` (DEC 
2004) '' in its place.
0
6. Add section 52.222-39 to read as follows:


52.222-39  Notification of Employee Rights Concerning Payment of Union 
Dues or Fees.

    As prescribed in 22.1605, insert the following clause:

NOTIFICATION OF EMPLOYEE RIGHTS CONCERNING PAYMENT OF UNION DUES OR 
FEES (DEC 2004)

    (a) Definition. As used in this clause--
    United States means the 50 States, the District of Columbia, Puerto 
Rico, the Northern Mariana Islands, American Samoa, Guam, the U.S. 
Virgin Islands, and Wake Island.
    (b) Except as provided in paragraph (e) of this clause, during the 
term of this contract, the Contractor shall post a notice, in the form 
of a poster, informing employees of their rights concerning union 
membership and payment of union dues and fees, in conspicuous places in 
and about all its plants and offices, including all places where 
notices to employees are customarily posted. The notice shall include 
the following information (except that the information pertaining to 
National Labor Relations Board shall not be included in notices posted 
in the plants or offices of carriers subject to the Railway Labor Act, 
as amended (45 U.S.C. 151-188)).
    Notice to Employees
    Under Federal law, employees cannot be required to join a union 
or maintain membership in a union in order to retain their jobs. 
Under certain conditions, the law permits a union and an employer to 
enter into a union-security agreement requiring employees to pay 
uniform periodic dues and initiation fees. However, employees who 
are not union members can object to the use of their payments for 
certain purposes and can only be required to pay their share of 
union costs relating to collective bargaining, contract 
administration, and grievance adjustment.
    If you do not want to pay that portion of dues or fees used to 
support activities not related to collective bargaining, contract 
administration, or grievance adjustment, you are entitled to an 
appropriate reduction in your payment. If you believe that you have 
been required to pay dues or fees used in part to support activities 
not related to collective bargaining, contract administration, or 
grievance adjustment, you may be entitled to a refund and to an 
appropriate reduction in future payments.
    For further information concerning your rights, you may wish to 
contact the National Labor Relations Board (NLRB) either at one of 
its Regional offices or at the following address or toll free 
number:
    National Labor Relations Board
    Division of Information
    1099 14th Street, N.W.
    Washington, DC 20570
    1-866-667-6572
    1-866-316-6572 (TTY)
    To locate the nearest NLRB office, see NLRB's website at http://www.nlrb.gov.

[[Page 76355]]

    (c) The Contractor shall comply with all provisions of Executive 
Order 13201 of February 17, 2001, and related implementing regulations 
at 29 CFR part 470, and orders of the Secretary of Labor.
    (d) In the event that the Contractor does not comply with any of 
the requirements set forth in paragraphs (b), (c), or (g), the 
Secretary may direct that this contract be cancelled, terminated, or 
suspended in whole or in part, and declare the Contractor ineligible 
for further Government contracts in accordance with procedures at 29 
CFR part 470, Subpart B--Compliance Evaluations, Complaint 
Investigations and Enforcement Procedures. Such other sanctions or 
remedies may be imposed as are provided by 29 CFR part 470, which 
implements Executive Order 13201, or as are otherwise provided by law.
    (e) The requirement to post the employee notice in paragraph (b) 
does not apply to--
    (1) Contractors and subcontractors that employ fewer than 15 
persons;
    (2) Contractor establishments or construction work sites where no 
union has been formally recognized by the Contractor or certified as 
the exclusive bargaining representative of the Contractor's employees;
    (3) Contractor establishments or construction work sites located in 
a jurisdiction named in the definition of the United States in which 
the law of that jurisdiction forbids enforcement of union-security 
agreements;
    (4) Contractor facilities where upon the written request of the 
Contractor, the Department of Labor Deputy Assistant Secretary for 
Labor-Management Programs has waived the posting requirements with 
respect to any of the Contractor's facilities if the Deputy Assistant 
Secretary finds that the Contractor has demonstrated that--
    (i) The facility is in all respects separate and distinct from 
activities of the Contractor related to the performance of a contract; 
and
    (ii) Such a waiver will not interfere with or impede the 
effectuation of the Executive order; or
    (5) Work outside the United States that does not involve the 
recruitment or employment of workers within the United States.
    (f) The Department of Labor publishes the official employee notice 
in two variations; one for contractors covered by the Railway Labor Act 
and a second for all other contractors. The Contractor shall--
    (1) Obtain the required employee notice poster from the Division of 
Interpretations and Standards, Office of Labor-Management Standards, 
U.S. Department of Labor, 200 Constitution Avenue, NW, Room N-5605, 
Washington, DC 20210, or from any field office of the Department's 
Office of Labor-Management Standards or Office of Federal Contract 
Compliance Programs;
    (2) Download a copy of the poster from the Office of Labor-
Management Standards website at http://www.olms.dol.gov; or
    (3) Reproduce and use exact duplicate copies of the Department of 
Labor's official poster.
    (g) The Contractor shall include the substance of this clause in 
every subcontract or purchase order that exceeds the simplified 
acquisition threshold, entered into in connection with this contract, 
unless exempted by the Department of Labor Deputy Assistant Secretary 
for Labor-Management Programs on account of special circumstances in 
the national interest under authority of 29 CFR 470.3(c). For 
indefinite quantity subcontracts, the Contractor shall include the 
substance of this clause if the value of orders in any calendar year of 
the subcontract is expected to exceed the simplified acquisition 
threshold. Pursuant to 29 CFR part 470, Subpart B--Compliance 
Evaluations, Complaint Investigations and Enforcement Procedures, the 
Secretary of Labor may direct the Contractor to take such action in the 
enforcement of these regulations, including the imposition of sanctions 
for noncompliance with respect to any such subcontract or purchase 
order. If the Contractor becomes involved in litigation with a 
subcontractor or vendor, or is threatened with such involvement, as a 
result of such direction, the Contractor may request the United States, 
through the Secretary of Labor, to enter into such litigation to 
protect the interests of the United States.
    (End of clause)
0
7. Amend section 52.244-6 by revising the date of the clause; 
redesignating paragraph (c)(1)(v) as (c)(1)(vi), and adding a new 
paragraph (c)(1)(v) to read as follows:


52.244-6  Subcontracts for Commercial Items.

* * * * *

SUBCONTRACTS FOR COMMERCIAL ITEMS (DEC 2004)

* * * * *
    (c)(1) * * *
    (v) 52.222-39, Notification of Employee Rights Concerning Payment 
of Union Dues or Fees (DEC 2004) (E.O. 13201). Flow down as required in 
accordance with paragraph (g) of FAR clause 52.222-39).
* * * * *
[FR Doc. 04-27636 Filed 12-17-04; 8:45 am]
BILLING CODE 6820-EP-S