[Federal Register Volume 79, Number 104 (Friday, May 30, 2014)]
[Rules and Regulations]
[Pages 31201-31203]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2014-12406]


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DEPARTMENT OF DEFENSE

GENERAL SERVICES ADMINISTRATION

NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

48 CFR Part 52

[FAC 2005-74; FAR Case 2012-016; Item V; Docket No. 2012-0016, Sequence 
No. 1]
RIN 9000-AM50


Federal Acquisition Regulation; Defense Base Act

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

ACTION: Final rule.

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SUMMARY: DoD, GSA, and NASA are issuing a final rule amending the 
Federal Acquisition Regulation (FAR) to clarify contractor and 
subcontractor responsibilities to obtain workers' compensation 
insurance or to qualify as a self-insurer, and other requirements, 
under the terms of the Longshore and Harbor Workers' Compensation Act 
(LHWCA) as extended by the Defense Base Act (DBA).

DATES: Effective: July 1, 2014.

FOR FURTHER INFORMATION CONTACT: Mr. Edward N. Chambers, Procurement 
Analyst, at 202-501-3221 for clarification of content. For information 
pertaining to status or publication schedules, contact the Regulatory 
Secretariat at 202-501-4755. Please cite FAC 2005-74, FAR Case 2012-
016.

SUPPLEMENTARY INFORMATION:

I. Background

    DoD, GSA, and NASA published a proposed rule in the Federal 
Register at 78 FR 17176 on March 20, 2013, to make the necessary 
regulatory revisions to revise the FAR to clarify contractor and 
subcontractor responsibilities to obtain workers' compensation 
insurance or to qualify as a self-insurer, and other requirements, 
under the terms of the LHWCA, 33 U.S.C. 901, et seq., as extended by 
the DBA, 42 U.S.C. 1651, et seq. Three respondents submitted comments 
on the proposed rule.

II. Discussion and Analysis

    The Civilian Agency Acquisition Council and the Defense Acquisition 
Regulations Council (the Councils) reviewed the comments in the 
development of the final rule. A discussion of the comments and the 
changes made to the rule as a result of those comments are provided as 
follows:

A. Summary of Significant Changes

    This final rule includes one change to align the FAR with 
Department of Labor's (DOL) regulations and implementation of section 
30(a) of the LHWCA. This change involves deleting proposed paragraph 
(b) of FAR clause 52.228-3, which stated that the actions set forth 
under paragraphs (a)(2) through (a)(8) may be performed by the 
contractor's agent or insurance carrier. The DOL's regulations place 
the responsibility for reporting injuries on the employer, see 20 CFR 
703.115. The removal of proposed FAR 52.228-3 paragraph (b) also 
promotes consistency with the statutory requirements.

B. Analysis of Public Comments

1. Support of the Proposed Rule
    Comment: Two respondents expressed support for the rule.
    Response: The public's support for this rule is acknowledged.
 2. Clarify Term ``Days''
    Comment: One respondent recommends that the ten-day reporting 
period within the report of injury requirements set forth in proposed 
FAR 52.228-3 paragraph (a)(2) should be revised to read ``ten business 
days.'' The respondent asserts this modification will clarify the 
reporting period.
    Response: The intent of this rule is to alert contractors to their 
obligations

[[Page 31202]]

under the LHWCA, rather than to alter those obligations. The 
respondent's suggested revisions could result in altering a 
contractor's obligations and therefore are beyond the scope of the FAR 
rule. The DOL's regulation interprets the ten-day injury reporting 
period set forth in LHWCA section 30(a), 33 U.S.C. 930(a), as ten 
calendar days. See 20 CFR 702.201(a) (using unqualified term ``days'' 
to describe reporting period). Thus, adding ``business'' days would 
alter the intent of the law.
3. Inclusion of ``Work-Related'' Terminology
    Comment: The respondent states that the terms injury and death 
should be modified by adding the phrase ``work-related'' before both. 
The respondent asserts that this modification will serve to clarify a 
contractor's obligation.
    Response: The Councils do not recommend adding the phrase ``work-
related'' to the terms ``injury'' and ``death.'' The added phrase is 
not necessary as the LHWCA defines an injury in 33 U.S.C. 902(2) and 
the concept of work-relatedness is subsumed in the term ``injury.'' 
Moreover, the question whether a particular injury is work-related is 
often a difficult issue to resolve, and a contractor may not be able to 
decide whether a particular injury arose out of and in the course of 
employment within the meaning of the statute. By leaving the terms 
``injury'' and ``death'' unqualified, contractors will be encouraged to 
err on the side of reporting any incident that may be work-related.
4. Inclusion of ``Actual'' Terminology
    Comment: One respondent suggests that the provision should specify 
that the contractor's ``actual/constructive'' knowledge of the injury 
triggers the reporting period. The respondent recommends this revision 
to further clarify a contractor's obligation.
    Response: DOL's governing rules use the unqualified term 
``knowledge of an employee's injury or death'' when describing the 
event that triggers the reporting period. This FAR rule simply tracks 
that language.
5. Conflicts With Current Practice
    Comment: One respondent states that FAR 52.228-3 paragraph (b), 
which allows the contractor's agent or insurance carrier to submit the 
first report of injury referenced in paragraph (a)(2), is inconsistent 
with section 30(a) of the LHWCA, 33 U.S.C. 930(a), as extended by the 
DBA, and the DOL's current practice. The respondent argues that it is 
inappropriate to redefine this statutory provision through a FAR 
clause. The respondent recommends the proposed paragraph (b) should be 
amended to conform to current practice both under the DBA and LHWCA.
    Response: The Councils concur with the respondent. The intent of 
this FAR rule is to clarify and inform contractors of their obligations 
under the DBA and the DOL's regulations, not to alter those 
requirements. Section 30(a) of the LHWCA, as implemented by the DOL's 
regulations, places the responsibility for reporting injuries on the 
employer. See 20 CFR 703.115. Accordingly, the Councils are removing 
the proposed FAR 52.228-3 paragraph (b) to promote consistency with the 
statutes referenced above.
 6. Contractors Should Provide Insurance
    Comment: One respondent states that the contractors should have 
sufficient insurance to be able to pay compensation if an employee is 
injured.
    Response: The Councils concur that the views of this respondent are 
in accord with the intent of the law, this FAR rule, and the existing 
FAR clause 52.228-3.

III. Executive Orders 12866 and 13563

    Executive Orders (E.O.s) 12866 and 13563 direct agencies to assess 
all costs and benefits of available regulatory alternatives and, if 
regulation is necessary, to select regulatory approaches that maximize 
net benefits (including potential economic, environmental, public 
health and safety effects, distributive impacts, and equity). E.O. 
13563 emphasizes the importance of quantifying both costs and benefits, 
of reducing costs, of harmonizing rules, and of promoting flexibility. 
This is not a significant regulatory action and, therefore, was not 
subject to review under Section 6(b) of E.O. 12866, Regulatory Planning 
and Review, dated September 30, 1993. This rule is not a major rule 
under 5 U.S.C. 804.

IV. Regulatory Flexibility Act

    DoD, GSA, and NASA have prepared a Final Regulatory Flexibility 
Analysis (FRFA) consistent with the Regulatory Flexibility Act, 5 
U.S.C. 601, et seq. The FRFA is summarized as follows:

    DoD, GSA, and NASA do not expect this 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 this rule merely clarifies the existing prescriptions and 
clauses relating to contractor and subcontractor responsibilities to 
obtain workers' compensation insurance or to qualify as a self-
insurer, and other requirements, under the terms of the LHWCA as 
extended by the DBA, and implemented in DOL Regulations. No comments 
from small entities were submitted in reference to the Regulatory 
Flexibility Act request under the proposed rule.
    The rule imposes no reporting, recordkeeping, or other 
information collection requirements. The rule does not duplicate, 
overlap, or conflict with any other Federal rules, and there are no 
known significant alternatives to the rule.

    Interested parties may obtain a copy of the FRFA from the 
Regulatory Secretariat. The FAR Secretariat has submitted a copy of the 
FRFA to the Chief Counsel for Advocacy of the Small Business 
Administration.

V. Paperwork Reduction Act

    The rule does not contain any new information collection 
requirements that require the approval of the Office of Management and 
Budget under the Paperwork Reduction Act (44 U.S.C. Chapter 35).

List of Subjects in 48 CFR Part 52

    Government procurement.

    Dated: May 22, 2014.
William Clark,
Acting Director, Office of Government-wide Acquisition Policy, Office 
of Government-wide Policy.

    Therefore, DoD, GSA, and NASA amend 48 CFR part 52 as set forth 
below:

PART 52--SOLICITATION PROVISIONS AND CONTRACT CLAUSES

0
1. The authority citation for 48 CFR part 52 continues to read as 
follows:

    Authority:  40 U.S.C. 121(c); 10 U.S.C. chapter 137; and 51 
U.S.C. 20113.


0
2. Revise section 52.228-3 to read as follows:


52.228-3  Workers' Compensation Insurance (Defense Base Act).

    As prescribed in 28.309(a), insert the following clause:

Workers' Compensation Insurance (Defense Base Act) (Jul 2014)

    (a) The Contractor shall--
    (1) Before commencing performance under this contract, establish 
provisions to provide for the payment of disability compensation and 
medical benefits to covered employees and death benefits to their 
eligible survivors, by purchasing workers' compensation insurance or 
qualifying as a self-insurer under the Longshore and Harbor Workers' 
Compensation Act (33 U.S.C. 932) as extended by the Defense Base Act 
(42 U.S.C. 1651, et seq.), and continue to maintain provisions to 
provide such Defense Base Act benefits until contract performance is 
completed;

[[Page 31203]]

    (2) Within ten days of an employee's injury or death or from the 
date the Contractor has knowledge of the injury or death, submit 
Form LS-202 (Employee's First Report of Injury or Occupational 
Illness) to the Department of Labor in accordance with the Longshore 
and Harbor Workers' Compensation Act (33 U.S.C. 930(a), 20 CFR 
702.201 to 702.203);
    (3) Pay all compensation due for disability or death within the 
time frames required by the Longshore and Harbor Workers' 
Compensation Act (33 U.S.C. 914, 20 CFR 702.231 and 703.232);
    (4) Provide for medical care as required by the Longshore and 
Harbor Workers' Compensation Act (33 U.S.C. 907, 20 CFR 702.402 and 
702.419);
    (5) If controverting the right to compensation, submit Form LS-
207 (Notice of Controversion of Right to Compensation) to the 
Department of Labor in accordance with the Longshore and Harbor 
Workers' Compensation Act (33 U.S.C. 914(d), 20 CFR 702.251);
    (6) Immediately upon making the first payment of compensation in 
any case, submit Form LS-206 (Payment Of Compensation Without Award) 
to the Department of Labor in accordance with the Longshore and 
Harbor Workers' Compensation Act (33 U.S.C. 914(c), 20 CFR 702.234);
    (7) When payments are suspended or when making the final 
payment, submit Form LS-208 (Notice of Final Payment or Suspension 
of Compensation Payments) to the Department of Labor in accordance 
with the Longshore and Harbor Workers' Compensation Act (33 U.S.C. 
914(c) and (g), 20 CFR 702.234 and 702.235); and
    (8) Adhere to all other provisions of the Longshore and Harbor 
Workers' Compensation Act as extended by the Defense Base Act, and 
Department of Labor regulations at 20 CFR Parts 701 to 704.
    (b) For additional information on the Longshore and Harbor 
Workers' Compensation Act requirements see http://www.dol.gov/owcp/dlhwc/lsdba.htm.
    (c) The Contractor shall insert the substance of this clause, 
including this paragraph (c), in all subcontracts to which the 
Defense Base Act applies.

    (End of clause)

[FR Doc. 2014-12406 Filed 5-29-14; 8:45 am]
BILLING CODE 6820-EP-P