[Federal Register Volume 74, Number 22 (Wednesday, February 4, 2009)]
[Presidential Documents]
[Pages 6103-6106]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E9-2484]

                        Presidential Documents 

Federal Register / Vol. 74, No. 22 / Wednesday, February 4, 2009 / 
Presidential Documents

[[Page 6103]]

                Executive Order 13495 of January 30, 2009

Nondisplacement of Qualified Workers Under 
                Service Contracts

                When a service contract expires, and a follow-on 
                contract is awarded for the same service, at the same 
                location, the successor contractor or its 
                subcontractors often hires the majority of the 
                predecessor's employees. On some occasions, however, a 
                successor contractor or its subcontractors hires a new 
                work force, thus displacing the predecessor's 

                The Federal Government's procurement interests in 
                economy and efficiency are served when the successor 
                contractor hires the predecessor's employees. A 
                carryover work force reduces disruption to the delivery 
                of services during the period of transition between 
                contractors and provides the Federal Government the 
                benefits of an experienced and trained work force that 
                is familiar with the Federal Government's personnel, 
                facilities, and requirements.

                Therefore, by the authority vested in me as President 
                by the Constitution and the laws of the United States 
                of America, including the Federal Property and 
                Administrative Services Act, 40 U.S.C. 101 et seq., and 
                in order to promote economy and efficiency in Federal 
                Government procurement, it is hereby ordered as 

                Section 1. Policy. It is the policy of the Federal 
                Government that service contracts and solicitations for 
                such contracts shall include a clause that requires the 
                contractor, and its subcontractors, under a contract 
                that succeeds a contract for performance of the same or 
                similar services at the same location, to offer those 
                employees (other than managerial and supervisory 
                employees) employed under the predecessor contract 
                whose employment will be terminated as a result of the 
                award of the successor contract, a right of first 
                refusal of employment under the contract in positions 
                for which they are qualified. There shall be no 
                employment openings under the contract until such right 
                of first refusal has been provided. Nothing in this 
                order shall be construed to permit a contractor or 
                subcontractor to fail to comply with any provision of 
                any other Executive Order or law of the United States.

                Sec. 2. Definitions.

                    (a) ``Service contract'' or ``contract'' means any 
                contract or subcontract for services entered into by 
                the Federal Government or its contractors that is 
                covered by the Service Contract Act of 1965, as 
                amended, 41 U.S.C. 351 et seq., and its implementing 
                    (b) ``Employee'' means a service employee as 
                defined in the Service Contract Act of 1965, 41 U.S.C. 

                Sec. 3. Exclusions. This order shall not apply to:

                    (a) contracts or subcontracts under the simplified 
                acquisition threshold as defined in 41 U.S.C. 403;
                    (b) contracts or subcontracts awarded pursuant to 
                the Javits-Wagner-O'Day Act, 41 U.S.C. 46-48c;
                    (c) guard, elevator operator, messenger, or 
                custodial services provided to the Federal Government 
                under contracts or subcontracts with sheltered 
                workshops employing the severely handicapped as 
                described in section 505 of the Treasury, Postal 
                Services and General Government Appropriations Act, 
                1995, Public Law 103-329;

[[Page 6104]]

                    (d) agreements for vending facilities entered into 
                pursuant to the preference regulations issued under the 
                Randolph-Sheppard Act, 20 U.S.C. 107; or
                    (e) employees who were hired to work under a 
                Federal service contract and one or more nonfederal 
                service contracts as part of a single job, provided 
                that the employees were not deployed in a manner that 
                was designed to avoid the purposes of this order.

                Sec. 4. Authority to Exempt Contracts. If the head of a 
                contracting department or agency finds that the 
                application of any of the requirements of this order 
                would not serve the purposes of this order or would 
                impair the ability of the Federal Government to procure 
                services on an economical and efficient basis, the head 
                of such department or agency may exempt its department 
                or agency from the requirements of any or all of the 
                provisions of this order with respect to a particular 
                contract, subcontract, or purchase order or any class 
                of contracts, subcontracts, or purchase orders.

                Sec. 5. Contract Clause. The following contract clause 
                shall be included in solicitations for and service 
                contracts that succeed contracts for performance of the 
                same or similar work at the same location:


                    ``(a) Consistent with the efficient performance of 
                this contract, the contractor and its subcontractors 
                shall, except as otherwise provided herein, in good 
                faith offer those employees (other than managerial and 
                supervisory employees) employed under the predecessor 
                contract whose employment will be terminated as a 
                result of award of this contract or the expiration of 
                the contract under which the employees were hired, a 
                right of first refusal of employment under this 
                contract in positions for which employees are 
                qualified. The contractor and its subcontractors shall 
                determine the number of employees necessary for 
                efficient performance of this contract and may elect to 
                employ fewer employees than the predecessor contractor 
                employed in connection with performance of the work. 
                Except as provided in paragraph (b) there shall be no 
                employment opening under this contract, and the 
                contractor and any subcontractors shall not offer 
                employment under this contract, to any person prior to 
                having complied fully with this obligation. The 
                contractor and its subcontractors shall make an express 
                offer of employment to each employee as provided herein 
                and shall state the time within which the employee must 
                accept such offer, but in no case shall the period 
                within which the employee must accept the offer of 
                employment be less than 10 days.
                    ``(b) Notwithstanding the obligation under 
                paragraph (a) above, the contractor and any 
                subcontractors (1) may employ under this contract any 
                employee who has worked for the contractor or 
                subcontractor for at least 3 months immediately 
                preceding the commencement of this contract and who 
                would otherwise face lay-off or discharge, (2) are not 
                required to offer a right of first refusal to any 
                employee(s) of the predecessor contractor who are not 
                service employees within the meaning of the Service 
                Contract Act of 1965, as amended, 41 U.S.C. 357(b), and 
                (3) are not required to offer a right of first refusal 
                to any employee(s) of the predecessor contractor whom 
                the contractor or any of its subcontractors reasonably 
                believes, based on the particular employee's past 
                performance, has failed to perform suitably on the job.
                    ``(c) In accordance with Federal Acquisition 
                Regulation 52.222-41(n), the contractor shall, not less 
                than 10 days before completion of this contract, 
                furnish the Contracting Officer a certified list of the 
                names of all service employees working under this 
                contract and its subcontracts during the last month of 
                contract performance. The list shall also contain 
                anniversary dates of employment of each service 
                employee under this contract and its predecessor 
                contracts either with the current or predecessor 
                contractors or their subcontractors. The Contracting 
                Officer will provide the list to the successor 
                contractor, and the list shall be provided on request 
                to employees or their representatives.

[[Page 6105]]

                    ``(d) If it is determined, pursuant to regulations 
                issued by the Secretary of Labor (Secretary), that the 
                contractor or its subcontractors are not in compliance 
                with the requirements of this clause or any regulation 
                or order of the Secretary, appropriate sanctions may be 
                imposed and remedies invoked against the contractor or 
                its subcontractors, as provided in Executive Order 
                (No.) --------------, the regulations, and relevant 
                orders of the Secretary, or as otherwise provided by 
                    ``(e) In every subcontract entered into in order to 
                perform services under this contract, the contractor 
                will include provisions that ensure that each 
                subcontractor will honor the requirements of paragraphs 
                (a) through (b) with respect to the employees of a 
                predecessor subcontractor or subcontractors working 
                under this contract, as well as of a predecessor 
                contractor and its subcontractors. The subcontract 
                shall also include provisions to ensure that the 
                subcontractor will provide the contractor with the 
                information about the employees of the subcontractor 
                needed by the contractor to comply with paragraph 5(c), 
                above. The contractor will take such action with 
                respect to any such subcontract as may be directed by 
                the Secretary as a means of enforcing such provisions, 
                including the imposition of sanctions for non-
                compliance: provided, however, that if the contractor, 
                as a result of such direction, becomes involved in 
                litigation with a subcontractor, or is threatened with 
                such involvement, the contractor may request that the 
                United States enter into such litigation to protect the 
                interests of the United States.''

                Sec. 6. Enforcement. (a) The Secretary of Labor 
                (Secretary) is responsible for investigating and 
                obtaining compliance with this order. In such 
                proceedings, the Secretary shall have the authority to 
                issue final orders prescribing appropriate sanctions 
                and remedies, including, but not limited to, orders 
                requiring employment and payment of wages lost. The 
                Secretary also may provide that where a contractor or 
                subcontractor has failed to comply with any order of 
                the Secretary or has committed willful violations of 
                this order or the regulations issued pursuant thereto, 
                the contractor or subcontractor, and its responsible 
                officers, and any firm in which the contractor or 
                subcontractor has a substantial interest, shall be 
                ineligible to be awarded any contract of the United 
                States for a period of up to 3 years. Neither an order 
                for debarment of any contractor or subcontractor from 
                further Government contracts under this section nor the 
                inclusion of a contractor or subcontractor on a 
                published list of noncomplying contractors shall be 
                carried out without affording the contractor or 
                subcontractor an opportunity for a hearing.

                    (b) This order creates no rights under the Contract 
                Disputes Act, and disputes regarding the requirement of 
                the contract clause prescribed by section 5 of this 
                order, to the extent permitted by law, shall be 
                disposed of only as provided by the Secretary in 
                regulations issued under this order. To the extent 
                practicable, such regulations shall favor the 
                resolution of disputes by efficient and informal 
                alternative dispute resolution methods. The Secretary 
                shall, in consultation with the Federal Acquisition 
                Regulatory Council, issue regulations, within 180 days 
                of the date of this order, to the extent permitted by 
                law, to implement the requirements of this order. The 
                Federal Acquisition Regulatory Council shall issue, 
                within 180 days of the date of this order, to the 
                extent permitted by law, regulations in the Federal 
                Acquisition Regulation to provide for inclusion of the 
                contract clause in Federal solicitations and contracts 
                subject to this order.

                Sec. 7. Revocation. Executive Order 13204 of February 
                17, 2001, is revoked.

                Sec. 8. Severability. If any provision of this order, 
                or the application of such provision or amendment to 
                any person or circumstance, is held to be invalid, the 
                remainder of this order and the application of the 
                provisions of such to any person or circumstances shall 
                not be affected thereby.

                Sec. 9. General Provisions. (a) Nothing in this order 
                shall be construed to impair or otherwise affect:

  (i) authority granted by law to an executive department, agency, or the 
head thereof; or

[[Page 6106]]

  (ii) functions of the Director of the Office of Management and Budget 
relating to budgetary, administrative, or legislative proposals.

                    (b) This order shall be implemented consistent with 
                applicable law and subject to the availability of 
                    (c) This order is not intended to, and does not, 
                create any right or benefit, substantive or procedural, 
                enforceable at law or in equity by any party against 
                the United States, its departments, agencies, or 
                entities, its officers, employees, or agents, or any 
                other person. This order is not intended, however, to 
                preclude judicial review of final decisions by the 
                Secretary in accordance with the Administrative 
                Procedure Act, 5 U.S.C. 701 et seq.

                Sec. 10. Effective Date. This order shall become 
                effective immediately and shall apply to solicitations 
                issued on or after the effective date for the action 
                taken by the Federal Acquisition Regulatory Council 
                under section 6(b) of this order.
                    (Presidential Sig.)

                THE WHITE HOUSE,

                    January 30, 2009.

[FR Doc. E9-2484
Filed 2-3-09; 8:45 am]
Billing code 3195-W9-P