[Federal Register Volume 75, Number 238 (Monday, December 13, 2010)]
[Rules and Regulations]
[Pages 77723-77726]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-30559]


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DEPARTMENT OF DEFENSE

GENERAL SERVICES ADMINISTRATION

NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

48 CFR Parts 1, 2, 22, and 52

[FAC 2005-47; FAR Case 2010-006; Item I; Docket 2010-0106, Sequence 1]
RIN 9000-AL76


Federal Acquisition Regulation; Notification of Employee Rights 
Under the National Labor Relations Act

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) are issuing an interim rule 
to amend the Federal Acquisition Regulation (FAR) to implement 
Executive Order 13496, Notification of Employee Rights Under Federal 
Labor Laws, as implemented by the Department of Labor (DoL). This 
Executive Order requires contractors to display a notice to employees 
of their rights under Federal labor laws, and the DoL has determined 
that the notice shall include employee rights under the National Labor 
Relations Act.

DATES: Effective Date: December 13, 2010.
    Comment Date: Interested parties should submit written comments to 
the Regulatory Secretariat on or before February 11, 2011 to be 
considered in the formulation of a final rule.

[[Page 77724]]


ADDRESSES: Submit comments identified by FAC 2005-47, FAR Case 2010-
006, by any of the following methods:
     Regulations.gov: http://www.regulations.gov. Submit 
comments via the Federal eRulemaking portal by inputting ``FAR Case 
2010-006'' under the heading ``Enter Keyword or ID'' and selecting 
``Search.'' Select the link ``Submit a Comment'' that corresponds with 
``FAR Case 2010-006.'' Follow the instructions provided at the ``Submit 
a Comment'' screen. Please include your name, company name (if any), 
and ``FAR Case 2010-006'' on your attached document.
     Mail: General Services Administration, Regulatory 
Secretariat (MVCB), ATTN: Hada Flowers, 1275 First Street, NE., 
Washington, DC 20417.
    Instructions: Please submit comments only and cite FAC 2005-47, FAR 
Case 2010-006, in all correspondence related to this case. All comments 
received will be posted without change to http://www.regulations.gov, 
including any personal and/or business confidential information 
provided.

FOR FURTHER INFORMATION CONTACT: For clarification of content, contact 
Ms. Clare McFadden, Procurement Analyst, at (202) 501-0044. For 
information pertaining to status or publication schedules, contact the 
Regulatory Secretariat at (202) 501-4755. Please cite FAC 2005-47, FAR 
Case 2010-006.

SUPPLEMENTARY INFORMATION:

A. Background

    Executive Order 13496, Notification of Employee Rights Under 
Federal Labor Laws, dated January 30, 2009 (published in the Federal 
Register at 74 FR 6107 on February 4, 2009), which revokes Executive 
Order 13201 of February 17, 2001, requires contractors and 
subcontractors to post a notice that informs employees of their rights 
under Federal labor laws. DoL has determined that the notice shall 
include employee rights under the National Labor Relations Act 
(``Act''), 29 U.S.C. 151 et seq. This Act encourages collective 
bargaining, and protects the exercise by employees of their freedom to 
associate, to self organize and to designate representatives of their 
own choosing for the purpose of negotiating the terms and conditions of 
their employment. The DoL 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. The DoL issued a final rule implementing Executive Order 
13496 at 29 CFR part 471, published in the Federal Register at 75 FR 
28368 on May 20, 2010, with an effective date of June 21, 2010.
    This FAR interim rule implements the requirements of the DoL final 
rule by creating a new FAR subpart 22.16 and clause 52.222-40, 
Notification of Employee Rights Under the National Labor Relations Act. 
Additionally, this rule revises FAR clauses at 52.212-5, Contract Terms 
and Conditions Required to Implement Statutes or Executive Orders--
Commercial Items, and FAR 52.244-6, Subcontracts for Commercial Items, 
to include the requirements of the new FAR clause 52.222-40.
    This rule amending the FAR is the formal notice to contracting 
officers to insert FAR clause 52.222-40 in all solicitations and 
contracts including acquisitions for commercial items and commercially 
available off-the-shelf (COTS), except acquisitions (see FAR 22.1605)--
    (1) Under the simplified acquisition threshold;
    (2) For work performed exclusively outside the United States; or
    (3) Covered in their entirety by an exemption granted by the 
Secretary of Labor.
    This is a significant regulatory action and, therefore, was 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 Councils do not expect this interim rule 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 it implements the requirements of DoL's final rule, published 
in the Federal Register on May 20, 2010, with an effective date of June 
21, 2010, that implemented Executive Order 13496 at 29 CFR part 471. 
The DoL final rule, implementing the requirements of Executive Order 
13496, requires contractors to post notices and to insert a clause in 
subcontracts requiring subcontractors to post the notice and similarly 
insert a clause in their subcontracts. The notice advises contractor 
and subcontractor employees of their rights under the National Labor 
Relations Act. 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 rule is only implementing the DoL rule which prescribes 
the content of the notices to be posted. The Department of Labor has 
certified that its rule will not have a significant economic impact on 
a substantial number of small entities. Therefore, an Initial 
Regulatory Flexibility Analysis has not been performed. The Councils 
invite comments from small business concerns and other interested 
parties on the expected impact of this rule on small entities.
    The Councils will also consider comments from small entities 
concerning the existing regulations in subparts affected by this rule 
in accordance with 5 U.S.C. 610. Interested parties must submit such 
comments separately and should cite 5 U.S.C. 610 (FAC 2005-47, FAR Case 
2010-006) in all correspondence.

C. Paperwork Reduction Act

    This interim rule does not impose any information collection 
requirements apart from those already imposed by the DoL rule (75 FR 
28368, May 20, 2010, effective date June 21, 2010). DoL has addressed 
the Paperwork Reduction Act (44 U.S.C. chapter 35) in the preamble to 
the final rule. DoL identified the burdens associated with the filing 
and processing of complaints by complainants and contractors in the 
notice of final rulemaking and obtained Office of Management and Budget 
clearance for such burdens. DoL also noted that the public disclosure 
of information originally supplied by the Federal Government to a 
recipient for the purpose of disclosure to the public is not considered 
a collection of information under the Act. The Councils believe that 
the package submitted by DoL meets the requirement imposed by the 
Paperwork Reduction Act and sufficiently covers this interim rule so 
that 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, the Administrator of General Services, and the 
Administrator of the National Aeronautics and Space Administration 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 13496 and the DoL rule at 29 CFR part 471, 
effective June 21, 2010. If this rule is not issued as an interim rule, 
contractors will not have the contractual requirement to display the 
notice to employees of their rights under Federal labor laws, as is 
required by DoL regulations on or after June 21,

[[Page 77725]]

2010. In addition, the regulated community was provided ample 
opportunity to comment on DoL's promulgation of that regulation, which 
prescribes the content of the employee notice, requirements for its 
posting, and enforcement procedures, and DoL received and considered 
numerous such comments in drafting the final rule. However, pursuant to 
41 U.S.C. 418b and FAR 1.501-3, 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 1, 2, 22, and 52

    Government procurement.

    Dated: November 24, 2010.
Millisa Gary,
Acting Director, Acquisition Policy Division.

0
Therefore, DoD, GSA, and NASA amend 48 CFR parts 1, 2, 22, and 52 as 
set forth below:
0
1. The authority citation for 48 CFR parts 1, 2, 22, and 52 continues 
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 1--FEDERAL ACQUISITION REGULATIONS SYSTEM


1.106  [Amended]

0
2. Amend section 1.106, in the table following the introductory text, 
by adding in numerical sequence, FAR segment ``22.16'' and its 
corresponding OMB Control Number ``1215-0209'', and FAR segment 
``52.222-40'' and its corresponding OMB Control Number ``1215-0209''.

PART 2--DEFINITIONS OF WORDS AND TERMS

0
3. Amend section 2.101 in paragraph (b)(2), in the definition ``United 
States'' by redesignating paragraphs (5) through (8) as paragraphs (6) 
through (9), respectively, and adding a new paragraph (5) to read as 
follows:


2.101  Definitions.

* * * * *
    United States * * *
    (5) For use in subpart 22.16, see the definition at 22.1601.
* * * * *

PART 22--APPLICATION OF LABOR LAWS TO GOVERNMENT ACQUISITIONS

0
4. Add subpart 22.16 to read as follows:
Subpart 22.16--Notification of Employee Rights Under the National Labor 
Relations Act
Sec.
22.1600 Scope of subpart.
22.1601 Definitions.
22.1602 Policy.
22.1603 Exceptions.
22.1604 Compliance evaluation and complaint investigations and 
sanctions for violations.
22.1605 Contract clause.

Subpart 22.16--Notification of Employee Rights Under the National 
Labor Relations Act


22.1600  Scope of subpart.

    This subpart prescribes policies and procedures to implement 
Executive Order 13496, dated January 30, 2009 (74 FR 6107, February 4, 
2009).


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 Commonwealth of the Northern Mariana Islands, American Samoa, 
Guam, the U.S. Virgin Islands, and Wake Island.


22.1602  Policy.

    (a) Executive Order 13496 requires contractors to post a notice 
informing employees of their rights under Federal labor laws.
    (b) The Secretary has determined that the notice must contain 
employee rights under the National Labor Relations Act (Act), 29 U.S.C. 
151 et seq. The Act encourages collective bargaining, and protects the 
exercise by employees of their freedom to associate, to self-organize, 
and to designate representatives of their own choosing for the purpose 
of negotiating the terms and conditions of their employment or other 
mutual aid or protection.


22.1603  Exceptions.

    (a) The requirements of this subpart do not apply to--
    (1) Contracts under the simplified acquisition threshold;
    (2) Subcontracts of $10,000 or less; and
    (3) Contracts or subcontracts for work performed exclusively 
outside the United States.
    (b) Exemptions granted by the Secretary. (1) If the Secretary finds 
that the requirements of the Executive Order impair the ability of the 
Government to procure goods and services on an economical and efficient 
basis or if special circumstances require an exemption in order to 
serve the national interest, the Secretary may exempt a contracting 
department or agency, or groups of departments or agencies, from the 
requirements of any or all of the provisions of this Executive Order 
with respect to a particular contract or subcontract, or any class of 
contracts or subcontracts, including the requirement to include the 
clause at 52.222-40, or parts of that clause, in contracts.
    (2) Requests for exemptions may be submitted in accordance with 
Department of Labor regulations at 29 CFR 471.3.


22.1604  Compliance evaluation and complaint investigations and 
sanctions for violations.

    (a) The Secretary may conduct compliance evaluations or investigate 
complaints of any contractor or subcontractor to determine if any of 
the requirements of the clause at 52.222-40 have been violated.
    (b) Contracting departments and agencies shall cooperate with the 
Secretary and provide such information and assistance as the Secretary 
may require in the performance of the Secretary's functions.
    (c) If the Secretary determines that there has been a violation, 
the Secretary may take such actions as set forth in 29 CFR 471.14.
    (d) The Secretary may not terminate or suspend a contract or 
suspend or debar a contractor if the agency head has provided written 
objections, which must include a statement of reasons for the objection 
and a finding that the contractor's performance is essential to the 
agency's mission, and continues to object to the imposition of such 
sanctions and penalties. Procedures for enforcement by the Secretary 
are set out in 29 CFR 471.10 through 29 CFR 471.16.


22.1605  Contract clause.

    (a) Insert the clause at 52.222-40, Notification of Employee Rights 
under the National Labor Relations Act, in all solicitations and 
contracts, including acquisitions for commercial items and commercially 
available off-the-shelf items, except acquisitions--
    (1) Under 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;
    (2) For work performed exclusively outside the United States; or
    (3) Covered (in their entirety) by an exemption granted by the 
Secretary.
    (b) A contracting agency may modify the clause at 52.222-40, if 
necessary, to reflect an exemption granted by the Secretary (see 
22.1603(b)).

[[Page 77726]]

PART 52--SOLICITATION PROVISIONS AND CONTRACT CLAUSES

0
5. Amend section 52.212-5 by--
0
a. Revising the date of the clause;
0
b. Redesignating paragraphs (b)(27) through (b)(44) as paragraphs 
(b)(28) through (b)(45), respectively; and adding a new paragraph 
(b)(27);
0
c. Adding paragraph (e)(1)(vii); and
0
d. In Alternate II by--
0
(1) Revising the date of Alternate II;
0
(2) Redesignating paragraphs (e)(1)(ii)(G) through (M) as paragraphs 
(e)(1)(ii)(H) through (N), respectively; and adding a new paragraph 
(e)(1)(ii)(G).
    The revised and added text reads 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 2010)

* * * * *
    (b) * * *
    (27) 52.222-40, Notification of Employee Rights Under the 
National Labor Relations Act (DEC 2010) (E.O. 13496).
* * * * *
    (e)(1) * * *
    (vii) 52.222-40, Notification of Employee Rights Under the 
National Labor Relations Act (DEC 2010) (E.O. 13496). Flow down 
required in accordance with paragraph (f) of FAR clause 52.222-40.
* * * * *
    Alternate II (DEC 2010).
* * * * *
    (e)(1) * * *
    (ii) * * *
    (G) 52.222-40, Notification of Employee Rights Under the 
National Labor Relations Act (DEC 2010) (E.O. 13496). Flow down 
required in accordance with paragraph (f) of FAR clause 52.222-40.
* * * * *

0
6. Amend section 52.213-4 by revising the date of the clause; and 
removing from paragraph (a)(2)(vii) ``(Oct 2010)'' and adding ``(DEC 
2010)'' in its place.
    The revision reads as follows:


52.213-4  Terms and Conditions--Simplified Acquisitions (Other Than 
Commercial Items).

* * * * *

Terms and Conditions--Simplified Acquisitions (Other Than Commercial 
Items) (DEC 2010)

* * * * *

0
7. Add section 52.222-40 to read as follows:


52.222-40  Notification of Employee Rights Under the National Labor 
Relations Act.

    As prescribed in 22.1605, insert the following clause:

Notification of Employee Rights Under the National Labor Relations Act 
(DEC 2010)

    (a) During the term of this contract, the Contractor shall post 
an employee notice, of such size and in such form, and containing 
such content as prescribed by the Secretary of Labor, in conspicuous 
places in and about its plants and offices where employees covered 
by the National Labor Relations Act engage in activities relating to 
the performance of the contract, including all places where notices 
to employees are customarily posted both physically and 
electronically, in the languages employees speak, in accordance with 
29 CFR 471.2(d) and (f).
    (1) Physical posting of the employee notice shall be in 
conspicuous places in and about the Contractor's plants and offices 
so that the notice is prominent and readily seen by employees who 
are covered by the National Labor Relations Act and engage in 
activities related to the performance of the contract.
    (2) If the Contractor customarily posts notices to employees 
electronically, then the Contractor shall also post the required 
notice electronically by displaying prominently, on any Web site 
that is maintained by the Contractor and is customarily used for 
notices to employees about terms and conditions of employment, a 
link to the Department of Labor's Web site that contains the full 
text of the poster. The link to the Department's Web site, as 
referenced in (b)(3) of this section, must read, ``Important Notice 
about Employee Rights to Organize and Bargain Collectively with 
Their Employers.''
    (b) This required employee notice, printed by the Department of 
Labor, may be--
    (1) Obtained from the Division of Interpretations and Standards, 
Office of Labor-Management Standards, U.S. Department of Labor, 200 
Constitution Avenue, NW., Room N-5609, Washington, DC 20210, (202) 
693-0123, or from any field office of the Office of Labor-Management 
Standards or Office of Federal Contract Compliance Programs;
    (2) Provided by the Federal contracting agency if requested;
    (3) Downloaded from the Office of Labor-Management Standards Web 
site at http://www.dol.gov/olms/regs/compliance/EO13496.htm; or
    (4) Reproduced and used as exact duplicate copies of the 
Department of Labor's official poster.
    (c) The required text of the employee notice referred to in this 
clause is located at Appendix A, Subpart A, 29 CFR Part 471.
    (d) The Contractor shall comply with all provisions of the 
employee notice and related rules, regulations, and orders of the 
Secretary of Labor.
    (e) In the event that the Contractor does not comply with the 
requirements set forth in paragraphs (a) through (d) of this clause, 
this contract may be terminated or suspended in whole or in part, 
and the Contractor may be suspended or debarred in accordance with 
29 CFR 471.14 and subpart 9.4. Such other sanctions or remedies may 
be imposed as are provided by 29 CFR part 471, which implements 
Executive Order 13496 or as otherwise provided by law.
    (f) Subcontracts. (1) The Contractor shall include the substance 
of this clause, including this paragraph (f), in every subcontract 
that exceeds $10,000 and will be performed wholly or partially in 
the United States, unless exempted by the rules, regulations, or 
orders of the Secretary of Labor issued pursuant to section 3 of 
Executive Order 13496 of January 30, 2009, so that such provisions 
will be binding upon each subcontractor.
    (2) The Contractor shall not procure supplies or services in a 
way designed to avoid the applicability of Executive Order 13496 or 
this clause.
    (3) The Contractor shall take such action with respect to any 
such subcontract as may be directed by the Secretary of Labor as a 
means of enforcing such provisions, including the imposition of 
sanctions for noncompliance.
    (4) However, if the Contractor becomes involved in litigation 
with a subcontractor, 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
8. Amend section 52.244-6 by revising the date of the clause and adding 
paragraph (c)(1)(vii) to read as follows:


52.244-6  Subcontracts for Commercial Items.

* * * * *

Subcontracts for Commercial Items (DEC 2010)

* * * * *
    (c)(1) * * *
    (vii) 52.222-40, Notification of Employee Rights Under the 
National Labor Relations Act (DEC 2010) (E.O. 13496), if flow down 
is required in accordance with paragraph (f) of FAR clause 52.222-
40.
* * * * *
[FR Doc. 2010-30559 Filed 12-10-10; 8:45 am]
BILLING CODE 6820-EP-P