[Federal Register Volume 79, Number 150 (Tuesday, August 5, 2014)]
[Presidential Documents]
[Pages 45309-45315]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2014-18561]


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                         Presidential Documents 
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  Federal Register / Vol. 79, No. 150 / Tuesday, August 5, 2014 / 
Presidential Documents  

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 Title 3--
 The President

[[Page 45309]]

                Executive Order 13673 of July 31, 2014

                
Fair Pay and Safe Workplaces

                By the authority vested in me as President by the 
                Constitution and the laws of the United States of 
                America, including 40 U.S.C. 121, and in order to 
                promote economy and efficiency in procurement by 
                contracting with responsible sources who comply with 
                labor laws, it is hereby ordered as follows:

                Section 1. Policy. This order seeks to increase 
                efficiency and cost savings in the work performed by 
                parties who contract with the Federal Government by 
                ensuring that they understand and comply with labor 
                laws. Labor laws are designed to promote safe, healthy, 
                fair, and effective workplaces. Contractors that 
                consistently adhere to labor laws are more likely to 
                have workplace practices that enhance productivity and 
                increase the likelihood of timely, predictable, and 
                satisfactory delivery of goods and services to the 
                Federal Government. Helping executive departments and 
                agencies (agencies) to identify and work with 
                contractors with track records of compliance will 
                reduce execution delays and avoid distractions and 
                complications that arise from contracting with 
                contractors with track records of noncompliance.

                Sec. 2. Compliance with Labor Laws. (a) Pre-award 
                Actions. (i) For procurement contracts for goods and 
                services, including construction, where the estimated 
                value of the supplies acquired and services required 
                exceeds $500,000, each agency shall ensure that 
                provisions in solicitations require that the offeror 
                represent, to the best of the offeror's knowledge and 
                belief, whether there has been any administrative 
                merits determination, arbitral award or decision, or 
                civil judgment, as defined in guidance issued by the 
                Department of Labor, rendered against the offeror 
                within the preceding 3-year period for violations of 
                any of the following labor laws and Executive Orders 
                (labor laws):

  (A) the Fair Labor Standards Act;

  (B) the Occupational Safety and Health Act of 1970;

  (C) the Migrant and Seasonal Agricultural Worker Protection Act;

  (D) the National Labor Relations Act;

  (E) 40 U.S.C. chapter 31, subchapter IV, also known as the Davis-Bacon 
Act;

  (F) 41 U.S.C. chapter 67, also known as the Service Contract Act;

  (G) Executive Order 11246 of September 24, 1965 (Equal Employment 
Opportunity);

  (H) section 503 of the Rehabilitation Act of 1973;

  (I) 38 U.S.C. 3696, 3698, 3699, 4214, 4301-4306, also known as the 
Vietnam Era Veterans' Readjustment Assistance Act of 1974;

  (J) the Family and Medical Leave Act;

  (K) title VII of the Civil Rights Act of 1964;

  (L) the Americans with Disabilities Act of 1990;

  (M) the Age Discrimination in Employment Act of 1967;

  (N) Executive Order 13658 of February 12, 2014 (Establishing a Minimum 
Wage for Contractors); or

[[Page 45310]]

  (O) equivalent State laws, as defined in guidance issued by the 
Department of Labor.

(ii) A contracting officer, prior to making an award, shall, as part of the 
responsibility determination, provide an offeror with a disclosure pursuant 
to section 2(a)(i) of this order an opportunity to disclose any steps taken 
to correct the violations of or improve compliance with the labor laws 
listed in paragraph (i) of this subsection, including any agreements 
entered into with an enforcement agency. The agency's Labor Compliance 
Advisor, as defined in section 3 of this order, in consultation with 
relevant enforcement agencies, shall advise the contracting officer whether 
agreements are in place or are otherwise needed to address appropriate 
remedial measures, compliance assistance, steps to resolve issues to avoid 
further violations, or other related matters.

(iii) In consultation with the agency's Labor Compliance Advisor, 
contracting officers shall consider the information provided pursuant to 
paragraphs (i) and (ii) of this subsection in determining whether an 
offeror is a responsible source that has a satisfactory record of integrity 
and business ethics, after reviewing the guidelines set forth by the 
Department of Labor and consistent with any final rules issued by the 
Federal Acquisition Regulatory (FAR) Council pursuant to section 4 of this 
order.

(iv) For any subcontract where the estimated value of the supplies acquired 
and services required exceeds $500,000 and that is not for commercially 
available off-the-shelf items, a contracting officer shall require that, at 
the time of execution of the contract, a contractor represents to the 
contracting agency that the contractor:

  (A) will require each subcontractor to disclose any administrative merits 
determination, arbitral award or decision, or civil judgment rendered 
against the subcontractor within the preceding 3-year period for violations 
of any of the requirements of the labor laws listed in paragraph (i) of 
this subsection, and update the information every 6 months; and

  (B) before awarding a subcontract, will consider the information 
submitted by the subcontractor pursuant to subparagraph (A) of this 
paragraph in determining whether a subcontractor is a responsible source 
that has a satisfactory record of integrity and business ethics, except for 
subcontracts that are awarded or become effective within 5 days of contract 
execution, in which case the information may be reviewed within 30 days of 
subcontract award.

(v) A contracting officer shall require that a contractor incorporate into 
subcontracts covered by paragraph (iv) of this subsection a requirement 
that the subcontractor disclose to the contractor any administrative merits 
determination, arbitral award or decision, or civil judgment rendered 
against the subcontractor within the preceding 3-year period for violations 
of any of the requirements of the labor laws listed in paragraph (i) of 
this subsection.

(vi) A contracting officer, Labor Compliance Advisor, and the Department of 
Labor (or other relevant enforcement agency) shall be available, as 
appropriate, for consultation with a contractor to assist in evaluating the 
information on labor compliance submitted by a subcontractor pursuant to 
paragraph (v) of this subsection.

(vii) As appropriate, contracting officers in consultation with the Labor 
Compliance Advisor shall refer matters related to information provided 
pursuant to paragraphs (i) and (iv) of this subsection to the agency 
suspending and debarring official in accordance with agency procedures.

                    (b) Post-award Actions. (i) During the performance 
                of the contract, each agency shall require that every 6 
                months contractors subject to this order update the 
                information provided pursuant to subsection (a)(i) of 
                this section and obtain the information required 
                pursuant to subsection (a)(v) of this section for 
                covered subcontracts.

[[Page 45311]]

(ii) If information regarding violations of labor laws is brought to the 
attention of a contracting officer pursuant to paragraph (i) of this 
subsection, or similar information is obtained through other sources, a 
contracting officer shall consider whether action is necessary in 
consultation with the agency's Labor Compliance Advisor. Such action may 
include agreements requiring appropriate remedial measures, compliance 
assistance, and resolving issues to avoid further violations, as well as 
remedies such as decisions not to exercise an option on a contract, 
contract termination, or referral to the agency suspending and debarring 
official.

(iii) A contracting officer shall require that if information regarding 
violations of labor laws by a contractor's subcontractor is brought to the 
attention of the contractor pursuant to subsections (a)(iv), (v) or (b)(i) 
of this section or similar information is obtained through other sources, 
then the contractor shall consider whether action is necessary. A 
contracting officer, Labor Compliance Advisor, and the Department of Labor 
shall be available for consultation with a contractor regarding appropriate 
steps it should consider. Such action may include appropriate remedial 
measures, compliance assistance, and resolving issues to avoid further 
violations.

(iv) The Department of Labor shall, as appropriate, inform contracting 
agencies of its investigations of contractors and subcontractors on current 
Federal contracts so that the agency can help the contractor determine the 
best means to address any issues, including compliance assistance and 
resolving issues to avoid or prevent violations.

(v) As appropriate, contracting officers in consultation with the Labor 
Compliance Advisor shall send information provided pursuant to paragraphs 
(i)-(iii) of this subsection to the agency suspending and debarring 
official in accordance with agency procedures.

                Sec. 3. Labor Compliance Advisors. Each agency shall 
                designate a senior agency official to be a Labor 
                Compliance Advisor, who shall:

                    (a) meet quarterly with the Deputy Secretary, 
                Deputy Administrator, or equivalent agency official 
                with regard to matters covered by this order;
                    (b) work with the acquisition workforce, agency 
                officials, and agency contractors to promote greater 
                awareness and understanding of labor law requirements, 
                including recordkeeping, reporting, and notice 
                requirements, as well as best practices for obtaining 
                compliance with these requirements;
                    (c) coordinate assistance for agency contractors 
                seeking help in addressing and preventing labor 
                violations;
                    (d) in consultation with the Department of Labor or 
                other relevant enforcement agencies, and pursuant to 
                section 4(b)(ii) of this order as necessary, provide 
                assistance to contracting officers regarding 
                appropriate actions to be taken in response to 
                violations identified prior to or after contracts are 
                awarded, and address complaints in a timely manner, by:

(i) providing assistance to contracting officers and other agency officials 
in reviewing the information provided pursuant to sections 2(a)(i), (ii), 
and (v) and 2(b)(i), (ii), and (iii) of this order, or other information 
indicating a violation of a labor law, so as to assess the serious, 
repeated, willful, or pervasive nature of any violation and evaluate steps 
contractors have taken to correct violations or improve compliance with 
relevant requirements;

(ii) helping agency officials determine the appropriate response to address 
violations of the requirements of the labor laws listed in section 2(a)(i) 
of this order or other information indicating such a labor violation 
(particularly serious, repeated, willful, or pervasive violations), 
including agreements requiring appropriate remedial measures, decisions not 
to award a contract or exercise an option on a contract, contract 
termination, or referral to the agency suspending and debarring official;

(iii) providing assistance to appropriate agency officials in receiving and 
responding to, or making referrals of, complaints alleging violations by

[[Page 45312]]

agency contractors and subcontractors of the requirements of the labor laws 
listed in section 2(a)(i) of this order; and

(iv) supporting contracting officers, suspending and debarring officials, 
and other agency officials in the coordination of actions taken pursuant to 
this subsection to ensure agency-wide consistency, to the extent 
practicable;

                    (e) as appropriate, send information to agency 
                suspending and debarring officials in accordance with 
                agency procedures;
                    (f) consult with the agency's Chief Acquisition 
                Officer and Senior Procurement Executive, and the 
                Department of Labor as necessary, in the development of 
                regulations, policies, and guidance addressing labor 
                law compliance by contractors and subcontractors;
                    (g) make recommendations to the agency to 
                strengthen agency management of contractor compliance 
                with labor laws;
                    (h) publicly report, on an annual basis, a summary 
                of agency actions taken to promote greater labor 
                compliance, including the agency's response pursuant to 
                this order to serious, repeated, willful, or pervasive 
                violations of the requirements of the labor laws listed 
                in section 2(a)(i) of this order; and
                    (i) participate in the interagency meetings 
                regularly convened by the Secretary of Labor pursuant 
                to section 4(b)(iv) of this order.

                Sec. 4. Ensuring Government-wide Consistency. In order 
                to facilitate Government-wide consistency in 
                implementing the requirements of this order:

                    (a) to the extent permitted by law, the FAR Council 
                shall, in consultation with the Department of Labor, 
                the Office of Management and Budget, relevant 
                enforcement agencies, and contracting agencies, propose 
                to amend the Federal Acquisition Regulation to identify 
                considerations for determining whether serious, 
                repeated, willful, or pervasive violations of the labor 
                laws listed in section 2(a)(i) of this order 
                demonstrate a lack of integrity or business ethics. 
                Such considerations shall apply to the integrity and 
                business ethics determinations made by both contracting 
                officers and contractors pursuant to this order. In 
                addition, such proposed regulations shall:

(i) provide that, subject to the determination of the agency, in most cases 
a single violation of law may not necessarily give rise to a determination 
of lack of responsibility, depending on the nature of the violation;

(ii) ensure appropriate consideration is given to any remedial measures or 
mitigating factors, including any agreements by contractors or other 
corrective action taken to address violations; and

(iii) ensure that contracting officers and Labor Compliance Advisors send 
information, as appropriate, to the agency suspending and debarring 
official, in accordance with agency procedures.

                    (b) the Secretary of Labor shall:

(i) develop guidance, in consultation with the agencies responsible for 
enforcing the requirements of the labor laws listed in section 2(a)(i) of 
this order, to assist agencies in determining whether administrative merits 
determinations, arbitral awards or decisions, or civil judgments were 
issued for serious, repeated, willful, or pervasive violations of these 
requirements for purposes of implementation of any final rule issued by the 
FAR Council pursuant to this order. Such guidance shall:

  (A) where available, incorporate existing statutory standards for 
assessing whether a violation is serious, repeated, or willful; and

  (B) where no statutory standards exist, develop standards that take into 
account:

(1) for determining whether a violation is ``serious'' in nature, the 
number of employees affected, the degree of risk posed or actual harm done 
by the violation to the health, safety, or well-being of a worker, the 
amount of damages incurred or fines or penalties assessed with

[[Page 45313]]

regard to the violation, and other considerations as the Secretary finds 
appropriate;

(2) for determining whether a violation is ``repeated'' in nature, whether 
the entity has had one or more additional violations of the same or a 
substantially similar requirement in the past 3 years;

(3) for determining whether a violation is ``willful'' in nature, whether 
the entity knew of, showed reckless disregard for, or acted with plain 
indifference to the matter of whether its conduct was prohibited by the 
requirements of the labor laws listed in section 2(a)(i) of this order; and

(4) for determining whether a violation is ``pervasive'' in nature, the 
number of violations of a requirement or the aggregate number of violations 
of requirements in relation to the size of the entity;

(ii) develop processes:

  (A) for Labor Compliance Advisors to consult with the Department of Labor 
in carrying out their responsibilities under section 3(d) of this order;

  (B) by which contracting officers and Labor Compliance Advisors may give 
appropriate consideration to determinations and agreements made by the 
Department of Labor and other agencies; and

  (C) by which contractors may enter into agreements with the Department of 
Labor or other enforcement agency prior to being considered for contracts.

(iii) review data collection requirements and processes, and work with the 
Director of the Office of Management and Budget, the Administrator for 
General Services, and other agency heads to improve those processes and 
existing data collection systems, as necessary, to reduce the burden on 
contractors and increase the amount of information available to agencies;

(iv) regularly convene interagency meetings of Labor Compliance Advisors to 
share and promote best practices for improving labor law compliance; and

(v) designate an appropriate contact for agencies seeking to consult with 
the Department of Labor pursuant to this order;

                    (c) the Director of the Office of Management and 
                Budget shall:

(i) work with the Administrator of General Services to include in the 
Federal Awardee Performance and Integrity Information System information 
provided by contractors pursuant to sections 2(a)(i) and (ii) and 2(b)(i) 
of this order, and data on the resolution of any issues related to such 
information; and

(ii) designate an appropriate contact for agencies seeking to consult with 
the Office of Management and Budget pursuant to this order;

                    (d) the Administrator of General Services, in 
                consultation with other relevant agencies, shall 
                develop a single Web site for Federal contractors to 
                use for all Federal contract reporting requirements 
                related to this order, as well as any other Federal 
                contract reporting requirements to the extent 
                practicable;
                    (e) in developing the guidance pursuant to 
                subsection (b) of this section and proposing to amend 
                the Federal Acquisition Regulation pursuant to 
                subsection (a) of this section, the Secretary of Labor 
                and the FAR Council, respectively, shall minimize, to 
                the extent practicable, the burden of complying with 
                this order for Federal contractors and subcontractors 
                and in particular small entities, including small 
                businesses, as defined in section 3 of the Small 
                Business Act (15 U.S.C. 632), and small nonprofit 
                organizations; and
                    (f) agencies shall provide the Administrator of 
                General Services with the necessary data to develop the 
                Web site described in subsection (d) of this section.

[[Page 45314]]

                Sec. 5. Paycheck Transparency. (a) Agencies shall 
                ensure that, for contracts subject to section 2 of this 
                order, provisions in solicitations and clauses in 
                contracts shall provide that, in each pay period, 
                contractors provide all individuals performing work 
                under the contract for whom they are required to 
                maintain wage records under the Fair Labor Standards 
                Act; 40 U.S.C. chapter 31, subchapter IV (also known as 
                the Davis-Bacon Act); 41 U.S.C. chapter 67 (also known 
                as the Service Contract Act); or equivalent State laws, 
                with a document with information concerning that 
                individual's hours worked, overtime hours, pay, and any 
                additions made to or deductions made from pay. Agencies 
                shall also require that contractors incorporate this 
                same requirement into subcontracts covered by section 2 
                of this order. The document provided to individuals 
                exempt from the overtime compensation requirements of 
                the Fair Labor Standards Act need not include a record 
                of hours worked if the contractor informs the 
                individuals of their overtime exempt status. These 
                requirements shall be deemed to be fulfilled if the 
                contractor is complying with State or local 
                requirements that the Secretary of Labor has determined 
                are substantially similar to those required by this 
                subsection.

                    (b) If the contractor is treating an individual 
                performing work under a contract or subcontract subject 
                to subsection (a) of this section as an independent 
                contractor, and not an employee, the contractor must 
                provide a document informing the individual of this 
                status.

                Sec. 6. Complaint and Dispute Transparency. (a) 
                Agencies shall ensure that for all contracts where the 
                estimated value of the supplies acquired and services 
                required exceeds $1 million, provisions in 
                solicitations and clauses in contracts shall provide 
                that contractors agree that the decision to arbitrate 
                claims arising under title VII of the Civil Rights Act 
                of 1964 or any tort related to or arising out of sexual 
                assault or harassment may only be made with the 
                voluntary consent of employees or independent 
                contractors after such disputes arise. Agencies shall 
                also require that contractors incorporate this same 
                requirement into subcontracts where the estimated value 
                of the supplies acquired and services required exceeds 
                $1 million.

                    (b) Subsection (a) of this section shall not apply 
                to contracts or subcontracts for the acquisition of 
                commercial items or commercially available off-the-
                shelf items.
                    (c) A contractor's or subcontractor's agreement 
                under subsection (a) of this section to arbitrate 
                certain claims only with the voluntary post-dispute 
                consent of employees or independent contractors shall 
                not apply with respect to:

(i) employees who are covered by any type of collective bargaining 
agreement negotiated between the contractor and a labor organization 
representing them; or

(ii) employees or independent contractors who entered into a valid contract 
to arbitrate prior to the contractor or subcontractor bidding on a contract 
covered by this order, except that a contractor's or subcontractor's 
agreement under subsection (a) of this section to arbitrate certain claims 
only with the voluntary post-dispute consent of employees or independent 
contractors shall apply if the contractor or subcontractor is permitted to 
change the terms of the contract with the employee or independent 
contractor, or when the contract is renegotiated or replaced.

                Sec. 7. Implementing Regulations. In addition to 
                proposing to amend the Federal Acquisition Regulation 
                as required by section 4(a) of this order, the FAR 
                Council shall propose such rules and regulations and 
                issue such orders as are deemed necessary and 
                appropriate to carry out this order, including sections 
                5 and 6, and shall issue final regulations in a timely 
                fashion after considering all public comments, as 
                appropriate.

                Sec. 8. Severability. If any provision of this order, 
                or applying such provision 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 circumstance shall not be 
                affected thereby.

[[Page 45315]]

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

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

(ii) the 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 
                appropriations.
                    (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.

                Sec. 10. Effective Date. This order shall become 
                effective immediately and shall apply to all 
                solicitations for contracts as set forth in any final 
                rule issued by the FAR Council under sections 4(a) and 
                7 of this order.
                
                
                    (Presidential Sig.)

                THE WHITE HOUSE,

                    July 31, 2014.

[FR Doc. 2014-18561
Filed 8-4-14; 8:45 am]
Billing code 3295-F4