Public Contract Law Journal

Responsible Responsibility: A Renewed Case for Considering a Prospective Contractor ’s Compliance with Labor and

by Christopher Roe Hebdon

Christopher Roe Hebdon (chebdon@law.gwu.edu) is a J.D. candidate at The George Washington University Law School and a member of the Public Contract Law Journal. The author would like to thank Professor Collin Swan for his guidance during the writing process; Emma O’Rourke-Friel, Meghan McConnell, Melisa Easaw, and Lauren Olmsted for their diligence throughout the editing process; and his friends and family for their continued encouragement and support.

I.  Introduction

Decades of privatization have precipitated tremendous growth in the federal government contracting industry.1 Since the year 2000, the federal contracting budget has nearly doubled,2 and present-day contract expenditures frequently exceed $500 billion annually.3 Contractors today employ approximately twenty-six million individuals or roughly twenty percent of the U.S. workforce.4 However, the panoply of labor and employment laws specifically protecting the welfare of contractor personnel have been, and continue to be, underenforced.5 As a result, labor and employment law violations are too common among contractors.6

The nation’s newspapers highlight the prevalence and personal impact of this persistent problem. Between 2015 and 2016, for example, four employees were killed during separate accidents at the Goodyear Tire and Rubber Company’s plant in Danville, Virginia.7 Although “very serious problems appear to have existed for an extended period of time at the plant,”8 Good- year received $8.3 million in federal contract dollars during fiscal year (FY) 2016.9 In another example from 2007, a washroom operator at a Cintas Corporation facility in Tulsa, Oklahoma became trapped in an industrial clothing dryer and died after exposure to temperatures exceeding 300 degrees for more than twenty minutes.10 The Occupational Safety and Health Administration (OSHA) found that “plant management…ignored safety and health rules.”11

Nevertheless, Cintas continued to earn millions in taxpayer dollars.12 And, in 2015, the Corrections Corporation of American (now known as CoreCivic) accumulated more than 21,000 wage and hour violations, underpaying workers by millions of dollars, while also receiving approximately a billion taxpayer dollars.13 Perhaps most troublingly, these stories are anything but unique since many prominent companies have federal contracts despite checkered legal histories.14

Undoubtedly, the overwhelming majority of “contractors offer good, well-paying jobs and safe working conditions.”15 Yet concerning headlines and decades of research and analysis demonstrate that by contracting with repeat labor and employment law violators, the federal government receives poor performance, wastes taxpayer money, endangers the welfare of the contractor workforce, and threatens the integrity and perceived fairness of the federal acquisition system.16 Responding to these concerns, both the Clinton and Obama administrations proposed reforms enabling contracting officers to consider a prospective contractor’s previous labor and employment law violations when determining their present responsibility.17 Unfortunately, both reforms were aggressively opposed and never successfully implemented.18 Nevertheless, the goal of empowering contracting officers with the capability and responsibility to consider a prospective contractor’s compliance with labor and employment laws prior to contract award remains a goal worthy of implementation.19

Supporting the policy goals that animated previous reform proposals, but cognizant of the limitations imposed by historical precedent, this Note aims to combat the government’s unfortunate tendency to contract with companies found to have violated the nation’s labor and employment laws repeatedly. Part II provides background on both the policy and procedure for responsibility determinations during contract formation. Part III discusses the primary issue: the award of contracts to contractors possessing a history of labor and employment law violations because contracting officers lack the resources to combat the problem. Part IV analyzes the policy prerogatives advanced by confronting this issue in government contracting. Part V presents the practical mechanics and common critiques of both previous reform proposals. And, Part VI concludes by presenting the author’s three-part proposal: (1)  amending the Federal Acquisition Regulation (FAR) to set forth an appro- priate standard for a “satisfactory record of integrity and business ethics;” (2)   expanding the information available to contracting officers regarding a prospective contractor’s previous compliance with labor and employment laws; and (3) requiring contracting officers to solicit and consider, in con- sultation with legal counsel, potentially mitigating factors prior to issuing a responsibility determination.

II.  Background

Responsibility determinations are one of the most important milestones during any federal government procurement.20 The current responsibility regulations,21 however, fail to empower contracting officers with the resources to effectively and efficiently consider a prospective contractor’s history of labor and employment law violations prior to contract award.22 This Note proposes reforming the current responsibility framework to address this problem.23 Therefore, understanding the author’s proposal requires first understanding the mechanics and present limitations of responsibility determinations.

The FAR states that “[p]urchases shall be made from, and contracts shall be awarded to, responsible prospective contractors only.”24 Therefore, once the government selects a contractor for award, but prior to actually awarding the contract, the FAR requires “the contracting officer [make] an affirmative determination of responsibility.”25 These determinations pertain only to the particular contract being awarded,26 and protect the government’s pecuniary interests by ensuring the prospective contractor has the present ability to perform the contract.27 Responsibility determinations are not punitive, however, and will not prohibit the contractor from competing for and receiving future contracts.28

“A prospective contractor must affirmatively demonstrate its responsibility.”29 The FAR’s general standards for responsibility require prospective contractors:

(a)  Have adequate financial resources to perform the contract, or the ability to obtain them (see 9.104-3(a));

(b)  Be able to comply with the required or proposed delivery or performance schedule, taking into consideration all existing commercial and governmental business commitments;

(c)  Have a satisfactory performance record (see 48 CFR 9.104-3(b) and Subpart 42.15). A prospective contractor shall not be determined responsible or nonresponsible solely on the basis of a lack of relevant performance history, except as provided in 9.104-2;

(d)  Have a satisfactory record of integrity and business ethics (for example, see Subpart 42.15);

(e)   Have the necessary organization, experience, accounting and operational controls, and technical skills, or the ability to obtain them…(see 9.104-3(a));

(f)Have the necessary production, construction, and technical equipment and facilities, or the ability to obtain them (see 9.104-3(a));

(g)   Be otherwise qualified and eligible to receive an award under applicable laws and regulations….30

Anomalously, the FAR does not set forth a standard to determine whether a prospective contractor possesses a “satisfactory record of integrity and business ethics.”31 The FAR does, however, articulate a standard to determine whether a prospective contractor has the “ability to obtain resources” 32 or a “satisfactory performance record.” 33 Moreover, applicable bid protest case law provides only minimal guidance. The phrase has been interpreted as synonymous with “probity, honesty, and uprightness.”34 And most cases involving a lack of integrity and business ethics involve violations of criminal statutes.35

When applying the FAR’s general standards to determine a prospective contractor’s present responsibility, contracting officers are expected to make informed business judgments by weighing the relevance of available information.36 Traditionally, contracting officers based responsibility determinations on information regarding the prospective contractor’s previous government contracts, drawn from disparate databases.37 However, in 2008, Congress authorized38 the creation of the Federal Awardee Performance and Integrity Information System (FAPIIS)39 to assist contracting officers to obtain information pertinent to responsibility.40 Launched in 2010,41 the FAPIIS consolidates responsibility data into a centralized, online database.42 The database provides contracting officers with information probative of present responsibility, including suspensions or debarments; past performance information; nonresponsibility determinations; terminations for default; defective pricing determinations; and information regarding civil, criminal, or administrative proceedings involving the award or performance of a contract that resulted in a finding of fault or any settlement where the contractor acknowledged fault.43 FAPIIS contains only information related to a government contract valued above $500,000,44 and only information from the previous five years.45

Prior to contract award, the FAR requires contracting officers to review the information available in the FAPIIS46 and exercise discretion and “sound judgment in determining the weight and relevance of the information obtained in FAPIIS and how it relates to the present acquisition.”47 Importantly, “[i]f the contracting officer obtains relevant information from FAPIIS…the contracting officer shall…[p]romptly request such additional information from the offeror as the offeror deems necessary in order to demonstrate the offeror’s responsibility to the contracting officer.”48

Once the contracting officer determines a prospective contractor is either responsible or nonresponsible, an interested party49 prejudiced by this determination may, in certain circumstances, seek review by filing a bid protest50 with either the Government Accountability Office (GAO)51 or the U.S. Court of Federal Claims (CoFC).52 Review in either fora, however, is highly deferential to the contracting officer’s initial determination.53 Both the GAO and the CoFC will not overturn a nonresponsibility determination unless the decision was unreasonable or unsupported by the record.54 And, neither fora will review an affirmative determination of responsibility.55

In addition to a bid protest, prospective contractors deemed nonresponsible based on a lack of integrity and business ethics also may challenge the contracting officer’s determination as a de facto debarment.56 “A de facto debarment occurs when the government uses nonresponsibility determinations as a means of excluding a firm from government contracting . . . rather than following the debarment regulations set forth at FAR subpart 9.4.”57 Although one nonresponsibility determination will not constitute a de facto debarment,58 multiple determinations of nonresponsibility may infringe a prospective contractor’s due process rights.59 In general, courts consider four factors when adjudicating whether a nonresponsibility determination constitutes a de facto debarment:

(1)  were other persons or government agencies apprised of the contracting officer’s finding of nonresponsibility; (2) was the information circulated for the purpose of preventing [the contractor] from securing future contracts with the government; (3) did circulation of the information in fact stigmatize [the contractor]; and (4) has [the contractor] suffered any losses in government business attributable to the contracting officer’s determination of nonresponsibility.60

III.  The Problem

Labor and employment law violations are too common among contractors61 because contracting officers lack the resources to combat the problem.62 In this regard, the FAR’s responsibility regulations have proven an inadequate safeguard. For example, the FAPIIS only provides contracting officers with responsibility information related to the prospective contractor’s past performance of a government contract.63 Contracting officers, therefore, do not have an effective and efficient mechanism to discover and consider other information probative of whether the prospective contractor has a “satisfactory record of integrity and business ethics.”64 Moreover, the absence of any meaningful standard for adjudicating this requirement may discourage contracting officers from basing a nonresponsibility determination on a prospective contractor’s lack of integrity and business ethics.65 And, despite this legal uncertainty, the FAR does not require contracting officers confer with legal counsel.66 Together, if not individually, these practical limitations produce uncertainty and inconsistency in the application of the FAR’s uniform responsibility requirements. The practical limitations of the FAR’s responsibility regulations perpetuate the government’s unfortunate practice of contracting with repeat labor and employment law violators. This results in poor performance, wastes taxpayer money, endangers the welfare of the contractor workforce, and threatens the integrity and perceived fairness of the federal acquisition system.

This problem endures despite decades of research and analysis. In 1995, for example, the General Accounting Office (today known as the Government Accountability Office)67 found that eighty contractors had been cited for violations of the National Labor Relations Act.68 Those same contractors, however, received a combined twenty-three billion dollars during FY 1993.69 Then, in 1996, GAO found that 261 contractors had been cited by OSHA for various workplace safety and health violations.70 In approximately seventy percent of those cases, OSHA found the contractor either intentionally or knowingly committed the violation.71 Nevertheless, those 261 contractors received a combined thirty-eight billion dollars from the taxpayers during FY 1994.72

More recent studies show the problem persists. In 2004, for example, GAO examined 654 Service Contract Act73 investigations conducted by the Department of Labor (DoL).74 GAO’s research found that in approximately eighty percent of the 654 investigations, contractors failed to pay employees wages required by law.75 Yet, only seventeen contractors were actively pursued by the DoL, and many continued to perform and receive lucrative contracts.76 Six years later, in 2010, GAO found that twenty-five of the fifty largest wage penalties and eight of the fifty largest safety and health penalties issued by the DoL and OSHA, respectively, were against government contractors.77 Those same contractors, however, received six billion dollars from the taxpayer during FY 2009.78 In 2013, the Senate Health, Education, Labor, and Pension (HELP) Committee reported that between 2007 and 2012, fifty-eight of the 200 largest labor or employment violations were committed by forty-nine contractors.79 These violations contributed to the death of more than forty contractor employees during the same period.80 And although DoL and OSHA issued a combined $196 million in penalties and fines, the forty-nine contractors received a combined $81 billion during FY 2012.81 Subsequently, in 2017, Senator Elizabeth Warren issued a report again exploring this familiar problem.82 Specifically, the report found that “[o]f the 100 largest penalties imposed by OSHA since January 1, 2015, more than a third were issued to companies that have held federal contracts within the last decade, and [twelve] applied to companies that received contracts worth at least $100,000 from the federal government in 2016.”83

IV.  The Rationale for Reform

“[T]he vast majority of [f]ederal contractors abide by labor laws.”84 Yet, despite decades of acknowledgement, the government continues to award contracts to contractors with a history of labor and employment law violations.85 This problem demands a solution — one that empowers contracting officers with the resources to combat the problem during the responsibility phase of contract formation.86 The following section sets forth the panoply of policy prerogatives advanced by addressing the problem, including improved performance, better value, enhanced competition, and increased fairness and integrity.

Studies of both federal and state contracting systems continuously evidence the performance and cost risks associated with contractors possessing a history of labor and employment law violations. For example, in 2008, statistics compiled by the nonpartisan Project on Government Oversight (POGO) showed that twenty-eight of the fifty most wasteful federal contractors had a history of repeat labor and employment law violations.87 POGO identified violations including, but not limited to, employment discrimination, unionization retaliation, workplace safety and health violations, sexual harassment, and inadequate compensation.88 Subsequently, in 2013, the Center for American Progress reported that approximately twenty-five percent of contractors identified in the aforementioned 2010 GAO report89 had significant performance problems, including submission of fraudulent invoices, cost overruns, overbilling, and performance delays.90 Studies of state and local contracting have produced similar results. In 2003, for example, the Fiscal Policy Institute examined thirty construction contractors in New York City.91 The study found that approximately ninety percent of contractors with no history of labor or employment law violations received good performance ratings, while less than fifty percent of contractors with a history of these types of violations received similar scores.92

Economic theory further supports the correlation. Scholars posit that contractors without a history of labor and employment law violations should have a more stable, better trained, and more proficient workforce capable of producing better results at lower costs.93 To this end, the Obama administration argued that “[c]ontractors 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 [f]ederal [g]overnment.”94

In addition to improved performance and better value, addressing the problems associated with contractors possessing a history of labor and employment law violations should improve competition and fairness throughout the federal acquisition system. For example, unscrupulous contractors may reduce operating costs and thereby outbid law-abiding contractors by paying below the prevailing wage, denying union organizing rights, or implementing inadequate safety and health precautions.95 These asymmetries jeopardize the fundamental fairness of the FAR’s contract formation system.96 In addition, any potential cost savings may be offset by the aforementioned increased risk of poor performance.97

Finally, the government, as the entity empowered to enact laws, promulgate regulations, and ensure their enforcement, has an obvious interest in ensuring it only does business with reputable contractors.98 “It seems reasonable that the taxpayer should not have to pay for contracts with lawbreakers and the [g]overnment should not promote the practice of lawbreaking.”99 Moreover, the government commonly shoulders additional costs in order to establish itself and its contractors as “model employer[s].”100 These contractual protections generally exceed those available in the general market and include prevailing wage laws,101 protections from discriminatory hiring practices,102 and minimum wage and overtime protections.103 Although these protections are not an exhaustive list of collateral social policies intended to protect the contractor workforce, they illustrate instances where the government felt the risks remedied justified any potential additional costs.104

V.  Previous Reform Proposals

There have been repeated attempts to address the problem described. In fact, both the Clinton105 and Obama106 administrations proposed reforms to improve the ability of contracting officers to consider a prospective contractor’s history of labor and employment law violations when determining present responsibility. Although the proposals were never fully implemented,107 they nevertheless provide important context and establish the precedential boundaries for the author’s proposal. The following discussion will begin with a brief overview of both administrations’ responsibility reform proposals, followed by an analysis of the various critiques precipitating their revocation.

A. The Clinton Administration’s Reform Proposal

The Clinton administration published a final rule amending FAR Part 9 on December 20, 2000.108 The rule, originally scheduled to become effective on January 19, 2001,109 sought to combat the problem defined above by clarifying the standard for a “satisfactory record of integrity and business ethics,”110 one of the requirements for demonstrating present responsibility.111 However, following an initial implementation delay,112 the rule was revoked by the Bush administration on December 27, 2001.113

In general, the Clinton administration’s proposed rule amended FAR 9.104-1(d) so that “to be determined responsible, a prospective contractor must…have a satisfactory record of integrity and business ethics including sat- isfactory compliance with federal laws including tax laws, labor and employment laws, environmental laws, antitrust laws, and consumer protection laws.”114 To ensure uniform application of the clarified requirement, the rule instructed contracting officers to consider “all relevant credible information” while “[giving] greatest weight to decisions within the past three years preceding the offer.”115 Although adjudicated legal violations were given priority, the Clinton administration’s rule allowed contracting officers to base nonresponsibility determinations upon mere allegations of illegal behavior.116 To help navigate the various legal complexities, contracting officers were instructed to “coordinate nonresponsibility determinations based upon integrity and business ethics with legal counsel.”117 Finally, prior to issuing a nonresponsibility determination, contracting officers were required to provide prospective contractors with notice.118 However, contractors had only minimal ability to respond to or argue against the government’s impending nonresponsibility determination.119 A more complete quotation of the Clinton administration’s proposed modifications to FAR Part 9 can be found in Part VI.A.120

B. The Obama Administration’s Reform Proposal

Almost a decade and a half later, the Obama administration proposed a similar reform, albeit with a different methodology. On July 31, 2014, the Obama administration issued Executive Order 13,673, titled “Fair Pay and Safe Workplaces.”121 To implement the executive order, the FAR Council issued a final FAR rule122 and the DoL issued accompanying guidance123 on August 25, 2016.

The Final Rule,124 however, was short-lived. On October 24, 2016, the U.S. District Court for the Eastern District of Texas enjoined its implementation and enforcement on several grounds.125 Subsequently, on March 27, 2017, President Trump signed a joint resolution126 pursuant to the Congressional Review Act127 and issued an executive order eliminating the Final Rule.128

In general, the Obama administration’s Final Rule would have amended the FAR to require prospective contractors to disclose certain labor and employment law violations during the responsibility phase of contract formation.129 Specifically, the Final Rule would have required prospective contractors seeking contracts valued over $500,000 to disclose any administrative merits determinations, arbitral awards or decisions, or civil judgments rendered against the company during the preceding three years for violations of fourteen federal labor and employment laws as well as state and local equivalents.130 The Final Rule would have also created a new contracting position — Agency Labor Compliance Advisor or ALCA — responsible for advising contracting officers regarding a prospective contractor’s compliance with applicable labor and employment laws.131 In theory, the contracting officer, aided by the ALCA, would determine whether a prospective contractor possessed a “satisfactory record of integrity and business ethics” and, considering the FAR’s other responsibility factors, issue a responsibility determination.132

The Final Rule also sought to impose novel responsibility-type requirements of contractors during contract performance (i.e., following contract award).133 Specifically, contractors with contracts valued above $500,000 would have been required to disclose, on a semi-annual basis, post-award violations of the aforementioned labor and employment laws.134 Then, depending on the severity of the disclosed violation, contracting officers would have been permitted to impose various contractual remedies such as requiring a labor compliance agreement, electing not to exercise a contract option, notifying the appropriate suspension and debarment official, or terminating the contract for default.135

C.  Courts, Critiques, and Criticisms

As the preceding sections make plain, both previous Democratic administrations sought to empower contracting officers with the resources to consider a prospective contractor’s compliance with various labor and employment laws when determining present responsibility.136 Although the proposed reforms differed, scholars, lawyers, and jurists articulated an array of similar, if not identical concerns. These included (1) preemption and due process; (2) departure from responsibility norms; (3) the expertise of contracting officers; and (4) litigation and compliance costs. Admittedly, many of these concerns were justified. However, they overlook the aforementioned risks inherent in the status quo such as poor performance, financial waste, danger to the welfare of the contract workforce, and threats to the integrity and perceived fairness of the federal acquisition system.137

1.   Preemption and Due Process

The Proposed Reforms138 were commonly challenged, in both the literature and the courtroom, on preemption and due process grounds because each authorized nonresponsibility determinations based solely on allegations of noncompliance with applicable federal or state laws.139 Many believed the Proposed Reforms permitted contracting officers to de facto adjudicate labor and employment law disputes and, thereby, circumvent the established and codified administrative and judicial processes for resolving alleged violations.140 Ultimately, these concerns were substantiated when the U.S. District Court for the Eastern District of Texas enjoined the Obama administration’s Final Rule, holding the Final Rule was both preempted by federal law and violative of contractor’s constitutional right to due process.141

In her order granting a preliminary injunction, Judge Marcia A. Crone held the Obama administration’s Final Rule was preempted because “Congress spelled out in precise detail what agency or court would be empowered to find a violation [of federal labor and employment law], how such a violation should be determined, and what the penalty or remedy would be.”142 Accordingly, permitting contracting officers to base nonresponsibility determinations on mere allegations of impropriety “departed from Congress’s explicit instructions dictating how violations of labor law statutes are to be addressed.”143

The Proposed Reforms also were found to violate the Constitution’s requirement that “no person shall . . . be deprived of life, liberty, or property, without due process of law.”144 Opponents argued that prospective contractors would be denied due process whenever contracting officers took it upon themselves to adjudicate alleged violations of labor and employment laws without first providing prospective contractors an impartial hearing to contest the allegations or demonstrate present responsibility.145 Ruling on the Obama administration’s Final Rule, Judge Crone agreed.146 Specifically, the court held that due process required a prospective contractor receive notice and an opportunity to respond before an impartial adjudicator with the possibility for administrative or judicial review before the government could impose penalties for an alleged violation of the applicable labor and employment laws.147

2.  Departure from Responsibility Norms

Critics also challenged the Proposed Reform’s apparent departure from the traditional norms governing the responsibility phase of contract formation. For example, the Proposed Reforms may have permitted contracting officers to base nonresponsibility determinations on labor and employment law violations unrelated to the prospective contractor’s present ability to perform the particular contract.148 The accuracy of these claims, however, remains unknown since the Proposed Reforms were never implemented completely.149 The Obama administration’s Final Rule also departed from the pre-award confines of responsibility determinations.150 Specifically, by imposing novel, semi-annual, post-award disclosure requirements for alleged or adjudicated labor and employment law violations during contract performance, the Final Rule would have introduced responsibility-like requirements into the realm of contract performance.151

3.   Expertise of Contracting Officers

The Proposed Reforms also posed practical concerns regarding the ability of contracting officers to properly understand and analyze the elaborate legal frameworks at issue.152 In fact, the Obama administration conceded this point, stating that “[e]ven if the information regarding labor [and employment] law violations is made available, contracting officers generally lack the expertise and tools to assess the severity of the labor [and employment] law violations brought to their attention and therefore cannot easily determine if a contractor’s actions show a lack of integrity and business ethics.”153 Both administrations attempted to address this concern by requiring contracting officers confer with legal counsel, but concerns remained.154 Specifically, critics questioned the ability of legal advisors to synthesize a prospective contractor’s compliance history meaningfully, the distribution of decisional authority between legal advisors and contracting officers, and the ability of legal advisors and contracting officers to gauge the impact of previous violations on present responsibility collectively.155

4.   Litigation and Compliance Costs

The Proposed Reforms also attracted criticism because of the potential for contractors to transfer increased litigation and compliance costs onto the government in the form of more expensive offers.156 Specifically, the Proposed Reforms threatened a so-called flood of responsibility protests and de facto debarment litigation as contractors and contracting officers grappled with the revised responsibility regime.157 In addition to litigation costs imposed by both administrations’ proposals, the Obama administration’s Final Rule would have imposed substantial compliance costs.158 According to the government’s own estimates, the Final Rule would have imposed approximately four billion dollars in additional compliance costs over the first ten years, the bulk of which fell on contractors, not the government.159

VI.  The Proposal

The status quo may have prevailed for now, but the problem remains — labor and employment law violations are too common among contractors160 because contracting officers lack the resources to effectively combat the problem.161 Fortunately, many methods for addressing the problem remain unexplored. The following proposal attempts to provide contracting officers with sufficient regulatory guidance and material information regarding a prospective contractor’s past compliance with federal labor and employment laws, while simultaneously protecting the prospective contractor’s due process rights.

The proposal contains three discrete elements. First, FAR 9.104-3 should be amended to set forth a standard for determining whether a prospective contractor “[has] a satisfactory record of integrity and business ethics” that accounts for past compliance with federal labor and employment laws. Second, contracting officers should have access to a more robust database of information regarding previously adjudicated violations, rather than relying on disclosures from prospective contractors. Third, contracting officers should be required, with the advice of legal counsel, to solicit and consider any potential mitigating factors or remedial measures prior to issuing a nonresponsibility determination.

This proposal attempts to ensure the government does business with law-abiding contractors; reduce the risk of poor performance; minimize the regulatory and compliance costs imposed on contractors; maintain the preaward nature of responsibility determinations; empower contracting officers to accurately gauge the impact of past noncompliance on present responsibility; and protect prospective contractor’s due process rights.

A.  Amending the FAR Standard for a Satisfactory Record of Integrity and Business Ethics

The FAR does not currently set forth a standard for determining whether a prospective contractor possesses “a satisfactory record of integrity and business ethics,” but it should. The FAR already contains standards for determining whether a prospective contractor has the “ability to obtain resources” or a “satisfactory performance record,” both requirements for demonstrating present responsibility. And, the latter standard sets forth one possible approach to determine the impact of past wrongdoing on present responsibility. The applicable FAR provision states:

Satisfactory performance record. A prospective contractor that is or recently has been seriously deficient in contract performance shall be presumed to be nonresponsible, unless the contracting officer determines that the circumstances were properly beyond the contractor’s control, or that the contractor has taken appropriate corrective action. Past failure to apply sufficient tenacity and perseverance to perform acceptably is strong evidence of nonresponsibility. Failure to meet the quality requirements of the contract is a significant factor to consider in determining satisfactory performance. The contracting officer shall consider the number of contracts involved and the extent of deficient performance in each contract when making this determination.162

The author’s proposal borrows key concepts from this regulatory text when articulating the proposed standard. The Clinton administration’s proposed reform also informs the author’s proposal. The administration proposed amending FAR 9.104-3 and suggested introducing a new provision at 9.104-3(c) stating:

Integrity and business ethics. (1) Prospective contractors must have a satisfactory record of integrity and business ethics in order to receive a Government contract. This determination can be made by examining a prospective contractor›s record of compliance with the law. A satisfactory record of compliance with the law indicates that the prospective contractor possesses basic honesty, integrity and trustworthiness, and that the Government can trust or rely on the contractor to perform the contract in a timely manner. In making a determination of responsibility based upon integrity and business ethics, contracting officers must consider all relevant credible information. However, contracting officers should give the greatest weight to violations of laws that have been adjudicated within the last three years preceding the offer. Normally, a single violation of law will not give rise to a determination of nonresponsibility, but evidence of repeated, pervasive, or significant violations of the law may indicate an unsatisfactory record of integrity and business ethics. Also, contracting officers should give consideration to any administrative agreements entered into with prospective contractors who take corrective action after disclosure of law violations. These contractors, despite findings of law violations, may continue to be responsible contractors because they have corrected the conditions that led to the misconduct. On the other hand, failure to comply with the terms of an administrative agreement is evidence of a lack of integrity and business ethics. Contracting officers must consider information based on the following which are listed in descending order of importance:

(i)      Convictions of and civil judgments rendered against the prospective contractor for—

(A)    Commission of fraud or a criminal offense in connection with obtaining, attempting to obtain, or performing a public (Federal, state or local) contract or subcontract;

(B)     Violation of Federal or state antitrust statutes relating to the submission of offers;

(C)    Commission of embezzlement, theft, forgery, bribery, falsification or destruction of records, making false statement, tax evasion, or receiving stolen property.

(ii)    Indictments for the offenses listed in 9.104-3(c)(1)(i).

(iii)   Relative to tax, labor and employment, environmental, antitrust, or consumer protection laws:

(A)    Federal or state felony convictions.

(B)     Adverse Federal court judgments in civil cases brought by the United States.

(C)    Adverse decisions by a Federal administrative law judge, board, or commission indicating violations of law.

(D)    Federal or state felony indictments.

Also, contracting officers may consider other relevant information such as civil or administrative complaints or similar actions filed by or on behalf of a federal agency, board or commission, if such action reflects an adjudicated determination by the agency.163

The author’s proposed FAR standard attempts to harmonize this current and proposed FAR language, while avoiding the risks associated with the status quo and the critiques associated with the previously proposed reforms. The proposed standard would incorporate a new clause into FAR 9.104-3, specifically 9.104-3(c), stating

Satisfactory record of integrity and business ethics based, in whole or in part, on violations of federal labor or employment law. (1) A satisfactory record of compliance with federal labor and employment law indicates that the prospective contractor possesses the basic honesty, integrity, and trustworthiness, and that the Government can trust or rely on the contractor to perform in a proper manner. A contracting officer shall consider a prospective contractor’s record of compliance with federal labor or employment law, regardless of whether the violation occurred during performance of another government contract.
(2)     In making a determination of responsibility based upon integrity and business ethics, contracting officers must consider all relevant information. Normally, a single violation of federal labor or employment law will not make a prospective contractor nonresponsible. However, evidence of repeated, pervasive, or significant violations of federal labor or employment law may indicate an unsatisfactory record of integrity and business ethics. Contracting officers shall only consider decisions within the three years preceding the offer.

(i)      Contracting officers shall weigh decisions as follows —

(A)    Convictions or civil judgments against the prospective contractor indicating the prospective contractor violated federal labor or employment law;

(B)     Decisions by administrative law judges or other adjudicatory decisions or orders issued by any agency, board, or commission, indicating the contractor violated federal labor or employment law; and

(C)    Administrative agreements entered into with prospective contractors who take corrective action after disclosure of labor or employment law violations.

(ii)    Contracting officers shall give no weight to the following —

(A)    Allegations or complaints alleging the contractor violated federal labor or employment laws; and

(B)     Preliminary agency action prior to the issuance of a decision identified in 9.104-3(c)(2)(i)(B).

(3)     Despite violations of federal labor or employment law, the prospective contractor may present to the contracting officer evidence that the contractor has taken appropriate corrective action.

The proposed standard features several advantages over both the status quo and the previous reform proposals. For example, preemption and due process concerns should be alleviated because contracting officers could not find a prospective contractor nonresponsible based on alleged violations of federal labor and employment laws. The proposal also would allow contracting officers to focus on determining the severity of the adjudicated violation and whether the violation continues to impact the prospective contractor’s present responsibility. The proposal purposefully is limited to the traditional pre-award confines of responsibility determinations. And, the standard will promote uniformity across both contracting agencies and contracting officers when determining the present responsibility of prospective contractors possessing a checkered history of labor and employment law compliance.

Concerns remain, however. For example, the standard may, at least initially, increase the probability and prevalence of bid protests and other litigation as both the government and prospective contractors grapple with the precise meaning and legal implications of the proposal. Concerns regarding potential abuse by contracting officers also endure. For example, contracting officers may use the standard as legal cover to find disfavored contractors nonresponsible based in whole or in part on past labor or employment law violations that do not, in fact, affect the prospective contractor’s present responsibility. The present responsibility framework, however, suffers from the same potential drawback.

B.  Expanding the Information Available to Contracting Officers in the Federal Awardee Performance and Integrity Information System

The proposed amendments to FAR 9.104-3 would be ineffective if contracting officers lacked the resources for identifying applicable legal violations and determining their impact, if any, on the prospective contractor’s present responsibility. Contracting officers currently have access to some relevant information through the FAPIIS, but additional information is necessary. In its current form, the FAPIIS includes information on only adjudicated and settled labor and employment law violations with a nexus to performance of a government contract. The database, therefore, overlooks many potentially material violations, limiting its efficacy for contracting officers during the responsibility phase of contract formation.

This proposal would expand the FAPIIS to include information pertinent to all adjudicated or settled labor and employment law violations relevant to a responsibility determination. Maintaining the expanded catalog of information in the FAPIIS would presumably fall upon the DoL. This may require the Labor Department to increase its current capability to track and record this information, hire additional personnel, and integrate its own computer systems with the FAPIIS. The proposal, however, would supplement the efforts of the DoL by requiring contractors certify, under FAR Subpart 4.12, the accuracy of the information in the FAPIIS or disclose any uncatalogued violations to the government. Contracting officers could then update the FAPIIS with the disclosed information, prior to issuing a responsibility determination. Admittedly, this proposal may increase a prospective contractor’s cost and risk allocations, but the author believes the impact would be minimal, especially in comparison to either previous reform proposal.

C.   Requiring Contracting Officers to Provide Prospective Contractors with Notice and an Opportunity to Be Heard Prior to Issuing a Nonresponsibility Determination

The proposed package of reforms attempts to balance the government’s pecuniary interests and the due process rights of prospective contractors. Thus, the proposal would require contracting officers to provide prospective contractors with notice of an impending nonresponsibility determination and an opportunity to present evidence of corrective action or other evidence probative of present responsibility prior to the issuance of the contracting officer’s determination. To help protect against concerns regarding the limited expertise of contracting officers, contracting officers would be required to consult with competent legal counsel throughout this process. Importantly, the FAR currently requires that contracting officers, before finding a prospective contractor nonresponsible based on information in the FAPIIS, “promptly request such additional information from the offeror as the offeror deems necessary in order to demonstrate the offeror’s responsibility to the contracting officer.”164 The FAR, however, does not require consultation with legal counsel.

This aspect of the proposal serves the interests of both the buyer and the seller. For example, ensuring prospective contractors receive adequate notice and an opportunity to be heard helps enable contracting officers to make better, more informed responsibility determinations. These protections also help ensure prospective contractors are afforded adequate due process protections before being denied a contract. Once codified, these protections combined with the proposed standard and FAPIIS reforms should enable contracting officers to identify prospective contractors with a history of labor and employment law violations while effectively and efficiently determining present responsibility.

VII.  Conclusion

Responsibility determinations are an integral part of contract formation. However, the efficacy of these pre-award determinations is undermined by the present inability of contracting officers to analyze a contractor’s history of labor and employment law violations accurately when determining whether a contractor possesses a satisfactory record of integrity and business ethics. This can result in the award of lucrative government contracts to companies with unsafe working environments or who fail to adequately compensate their employees. The Clinton and Obama administrations attempted to address these concerns by proposing a series of novel and potentially problematic reforms. Regardless, the fundamental goal of empowering contracting officers with the requisite tools to consider a contractor’s history of labor and employment law violations when conducting responsibility determinations remains a policy objective worthy of implementation and achievable through a series of smaller changes to the existing responsibility framework. By providing contracting officers with regulatory guidance and additional information, while simultaneously guaranteeing contractors additional procedural protections, responsibility determinations can help ensure taxpayer dollars are no longer paid to contractors who threaten the health and safety of the American workforce.

Entity:
Topic:
  1. See, e.g., Staff of Majority S. Comm. on Health, Education, Labor, and Pensions, 113th Cong., Acting Responsibly? Federal Contractors Frequently Put Workers’ Lives and Livelihoods at Risk 4 (2013) [hereinafter HELP Committee Report].
  2. See Nat’l Contract Mgmt. Ass’n, 2015 Annual Review of Government Contracting (2015), https://www.ncmahq.org/docs/default-source/default-document- library/pdfs/exec15---ncma-annual-review-of-government-contracting-2015-edition (containing annual breakdowns of contract spending between 1984 and 2014).
  3. U.S. Treasury, DataLab: Contract Spending Analysis—How Has Federal Contract Spending Changed Over Time?, https://datalab.usaspending.gov/contracts-over-time.html (last accessed Jan. 2, 2019) (containing annual breakdowns of contract spending between 2007 and 2018).
  4. HELP Committee Report, supra note 1, at 1, 4.
  5. See Staff of Sen. Elizabeth Warren, 115th Cong., Breach of Contract: How Federal Contractors Fail American Workers on the Taxpayer’s Dime 3 (2017), https://www.warren.senate.gov/files/documents/2017-3-6_Warren_Contractor_Report.pdf [hereinafter Senator Warren Report]; see infra Part III.
  6. See HELP Committee Report, supra note 1, at 7–22 (citing research and examples); Senator Warren Report, supra note 5, at 3–4; see also infra Part III.
  7. Jenna Zibton, Danville Goodyear Plant Issued Dozens of Violations, Fined More Than $1 Million, WSLS (Oct. 13, 2016), https://www.wsls.com/news/virginia/danville-goodyear-plant-issued-dozens-of-violations-fined-more-than-1-million_20170330130104338.
  8. Id.
  9. See Prime Spending Award Data: FY 2016, USASpending.gov (January 2019), https://www.USASpending.gov.
  10. Steven Greenhouse, U.S. Proposes $2.78 Million Fine in Worker’s Death, N.Y. Times (Aug. 18, 2007), https://www.nytimes.com/2007/08/18/washington/18cintas.html; Ben James, 2.78M OSHA Fine Follows Death at Cintas Laundry, Law360 (Aug. 20, 2007), https://www.law360.com/articles/32933/-2-78m-osha-fine-follows-death-at-cintas-laundry-.
  11. Greenhouse, supra note 10; James, supra note 10.
  12. See Prime Spending Award Data: FY 2016, USASpending.gov (January 2019), https://www.USASpending.gov.
  13. Senator Warren Report, supra note 5, at 6.
  14. See generally HELP Committee Report, supra note 1.
  15. Senator Warren Report, supra note 5, at 3.
  16. See infra Parts III, IV.
  17. See infra Parts V.A, V.B.
  18. See infra Part V.C.
  19. See infra Part IV.
  20. See John Cibinic, Jr., Ralph C. Nash, Jr. & Christopher R. Yukins, Formation of Government Contracts 409 (4th ed. 2011).
  21. FAR 9.1.
  22. HELP Committee Report, supra note 1, at 4.
  23. See infra Part VI.
  24. FAR 9.103(a).
  25. FAR 9.103(b).
  26. Kate M. Manuel, Cong. Research Serv., R40633, Responsibility Determinations Under the Federal Acquisition Regulation: Legal Standards and Procedures 3 (2013).
  27. See FAR 9.103(c) (“The award of a contract to a supplier based on lowest evaluated price alone can be false economy if there is subsequent default, late deliveries, or other unsatisfactory performance, resulting in additional contractual or administrative costs.”).
  28. Manuel, supra note 26, at 3.
  29. FAR 9.103(c).
  30. FAR 9.104-1 (emphasis added).
  31. FAR 9.104-1(d); see FAR 9.104-3 (articulating the standards discussed infra notes 32 & 33).
  32. “Except to the extent that a prospective contractor has sufficient resources or proposes to perform the contract by subcontracting, the contracting officer shall require acceptable evidence of the prospective contractor’s ability to obtain required resources (see 9.104-1(a), (e), and (f)). Acceptable evidence normally consists of a commitment or explicit arrangement, that will be in existence at the time of contract award, to rent, purchase, or otherwise acquire the needed facilities, equipment, other resources, or personnel. Consideration of a prime contractor’s compliance with limitations on subcontracting shall take into account the time period covered by the contract base period or quantities plus option periods or quantities, if such options are considered when evaluating offers for award.” FAR 9.104-3(a).
  33. “A prospective contractor that is or recently has been seriously deficient in contract performance shall be presumed to be nonresponsible, unless the contracting officer determines that the circumstances were properly beyond the contractor’s control, or that the contractor has taken appropriate corrective action. Past failure to apply sufficient tenacity and perseverance to perform acceptably is strong evidence of nonresponsibility. Failure to meet the quality requirements of the contract is a significant factor to consider in determining satisfactory performance. The contracting officer shall consider the number of contracts involved and the extent of deficient performance in each contract when making this determination.” FAR 9.104-3(b).
  34. Cibinic, Nash & Yukins, supra note 20, at 426 (citing Domco Chemical Corp., 48 Comp. Gen. 769, 1969 CPD ¶ 37 (1969)).
  35. Id.
  36. See Manuel, supra note 26, at 11–13; see also FAR 9.104-6(b).
  37. See HELP Committee Report, supra note 1, at 6 (discussing the various databases used during responsibility determinations); Federal Awardee Performance and Integrity Information System, 75 Fed. Reg. 14,059, 14,059 (Mar. 23, 2010).
  38. Duncan Hunter National Defense Authorization Act for Fiscal Year 2009, Pub. L. No. 110-417, § 872, 122 Stat. 4,356, 4,555–4,557 (codified at 41 U.S.C. § 2313).
  39. Federal Awardee Performance and Integrity Information System, https://www .fapiis.gov (last accessed Dec. 31, 2018); Past Performance Information Retrieval System, https://www.cpars.gov/ppirs/ppirsmain.htm (last accessed Dec. 31, 2018); see also FAR 9.104-6.
  40. See FAR 9.104-6(a)(1); 41 U.S.C. § 2313(e)(2)(A); Federal Awardee Performance and Integrity Information System, 75 Fed. Reg. 14,059, 14,059 (Mar. 23, 2010).
  41. Federal Awardee Performance and Integrity Information System, 75 Fed. Reg. 14,059, 14,059 (Mar. 23, 2010).
  42. See id. at 14,059–14,060; Cibinic, Nash & Yukins, supra note 20, at 421.
  43. FAR 9.104-6(c); 41 U.S.C. § 2313(c).
  44. 41 U.S.C. § 2313(b).
  45. Id. § 2313(c).
  46. FAR 9.104-6(a).
  47. FAR 9.104-6(b)(3).
  48. FAR 9.104-6(c).
  49. “Interested party means an actual or prospective bidder or offeror whose direct economic interest would be affected by the award of a contract or by the failure to award a contract.” 4 C.F.R. § 21.0(a)(1).
  50. “A bid protest is a challenge to the award or proposed award of a contract for the procurement of goods and services or a challenge to the terms of a solicitation for such a contract.” Bid Protests, Appropriations Law & Other Legal Work, U.S. Government Accountability Office, https://www.gao.gov/legal/bid-protests/faqs/ (last accessed Jan. 6, 2019).
  51. See 31 U.S.C. § 3552(a).
  52. See 28 U.S.C. § 1491(b)(1).
  53. Manuel, supra note 26, at 11–13.
  54. Id. at 13.
  55. 4 C.F.R. § 21.5(c); see also Cibinic, Nash & Yukins, supra note 20, at 411–12 (citing FN Mfg., Inc., B-297172, 2005 CPD ¶ 212 (Comp. Gen. Dec. 1, 2005)).
  56. Manuel, supra note 26, at 12; Cibinic, Nash & Yukins, supra note 20, at 496–97.
  57. Quality Trust, Inc., B-289445, 2002 CPD ¶ 41 (Comp. Gen. Feb. 14, 2002).
  58. Cibinic, Nash & Yukins, supra note 20, at 497.
  59. Id. at 496–98.
  60. Id. at 499 (citing John Carlo, Inc. v. Corps of Engineers of the U.S. Army, 539 F. Supp. 1075 (N.D. Tex. 1982)).
  61. See HELP Committee Report, supra note 1, at 7–22 (citing research and examples); Senator Warren Report, supra note 5, at 3–4.
  62. Id. at 4.
  63. See supra Part II.
  64. See HELP Committee Report, supra note 1, at 4.
  65. See Federal Acquisition Regulation; Contractor Responsibility, Labor Relations Costs, and Costs Relating to Legal and Other Proceedings, 65 Fed. Reg. 80,256 (Dec. 20, 2000).
  66. See FAR 9.1.
  67. In 2004 the General Accounting Office was renamed the Government Accountability Office. History, U.S. Government Accountability Office, https://www.gao.gov/about/what-gao-is/history (last accessed Jan. 3, 2019).
  68. U.S. Gen. Accounting Off., GAO/HEHS-96-8, Worker Protection: Federal Contractors and Violations of Labor Law 5 (1995) [hereinafter 1995 GAO Study].
  69. Id. at 5.
  70. U.S. Gen. Accounting Off., GAO/HEHS-96-157, Occupational Safety and Health: Violations of Safety and Health Regulations by Federal Contractors 10 (1996) [hereinafter 1996 GAO Study].
  71. Id. at 16.
  72. Id. at 10.
  73. The Service Contract Act requires government contractors performing prime contracts valued over $2,500 to compensate service sector employees according to the wage rates and fringe benefits prevailing in the industry. Wage and Hour Division, McNamara-O’Hara Service Contract Act, United States Department of Labor, https://www.dol.gov/whd/govcontracts/sca.htm (last accessed Dec. 30, 2019).
  74. U.S. Gov’t Accountability Off., GAO-06-27, Service Contract Act: Wage Determination Process Could Benefit from Greater Transparency, and Better Use of Violation Data Could Improve Enforcement 21–25 (2005) [hereinafter 2004 GAO Study].
  75. Id.
  76. Id. at 25.
  77. U.S. Gov’t Accountability Off., GAO-10-1033, Federal Contracting: Assessments and Citations of Federal Labor Law Violations by Selected Federal Contractors 7–8 (2010) [hereinafter 2010 GAO Study].
  78. Id. at 8.
  79. 2013 HELP Committee Report, supra note 1, at 8.
  80. Id. at 11.
  81. Id. at 8.
  82. Senator Warren Report, supra note 5.
  83. Id. at 7.
  84. Federal Acquisition Regulation, Fair Pay and Safe Workplaces, 81 Fed. Reg. at 58,564.
  85. See supra Part III.
  86. See infra Part VI.
  87. David Madland & Michael Paarlberg, Center for American Progress Action Fund, Making Contracting Work for the United States: Government Spending Must Lead to Good Jobs 16 (2008) [hereinafter Madland & Paarlberg Report] (citing Federal Contractor Misconduct Database, Project on Government Oversight, https://www.contractormisconduct.org).
  88. Id. at 16.
  89. 2010 GAO Study, supra note 77, at 7–8.
  90. Karla Walter & David Madland, Center for American Progress Action Fund, At Our Expense: Federal Contractors that Harm Workers Also Shortchange Taxpayers 1 (2013) [hereinafter Walter & Madland Report].
  91. Moshe Adler, Fiscal Policy Institute, Prequalification of contractors: The Importance of Responsible Contracting on Public Works Projects 4 (2003).
  92. See id.
  93. See id. at 3; Madland & Paarlberg Report, supra note 87, at 15.
  94. Exec. Order No. 13,673, Fair Pay and Safe Workplaces, 79 Fed. Reg. 45,309, 45,309 (July 31, 2014).
  95. See Madland & Paarlberg Report, supra note 87, at 23.
  96. See Scott Amey, Project on Government Oversight, Deficient Contractor Accountability Leaves Agencies and Taxpayers at Risk 2 (Feb. 18, 2011), https:// cybercemetery.unt.edu/archive/cwc/20110929215226/http://www.wartimecontracting.gov/docs/hearing2011-02-28_testimony-Amey.pdf (last accessed Jan. 2, 2019) [hereinafter Scott Amey POGO Testimony].
  97. See infra Part VI.
  98. See Scott Amey POGO Testimony, supra note 96, at 6; Kelly Sherrill & Kate McQueen, The High Price of Campaign Promises: Ill-Conceived Labor Responsibility Policy, 30 Pub. Cont. L.J. 267, 280 (2001).
  99. Sherrill & McQueen, supra note 98, at 280.
  100. William G. Whittaker, Cong. Research Serv., RL32086, Federal Contract Labor Standards Statutes: An Overview i, 2 (2005).
  101. See 40 U.S.C. § 3142 (The Davis-Bacon Act of 1931); 41 U.S.C. § 6502 (The Walsh-Healy Public Contracts Act of 1936); 41 U.S.C. § 6703 (The McNamara-O’Hara Service Contract Act of 1965); see also Whittaker, supra note 100.
  102. See Exec. Order No. 8,802, Reaffirming Policy of Full Participation in the Defense Program by all Persons, Regardless of Race, Creed, Color, or National Origin, and Directing Certain Action in Furtherance of Said Policy, 6 Fed. Reg. 3,109 (June 25, 1941); Exec. Order No. 11,246, Equal Employment Opportunity, 30 Fed. Reg. 12,319 (Sept. 24, 1965); Exec. Order No. 13,672, Further Amendments to Executive Order 11,478, Equal Employment Opportunity in the Federal Government; and Exec. Order 11,246, Equal Employment Opportunity, 79 Fed. Reg. 42,971 (July 21, 2014).
  103. See Exec. Order No. 13,658, Establishing a Minimum Wage for Contractors, 79 Fed. Reg. 9,851 (Feb. 12, 2014).
  104. Sherrill & McQueen, supra note 98, at 280–81.
  105. See infra Part V.A.
  106. See infra Part V.B.
  107. See infra Part V.A, V.B.
  108. Federal Acquisition Regulation; Contractor Responsibility, Labor Relations Costs, and Costs Relating to Legal and Other Proceedings, 65 Fed. Reg. 80,256 (Dec. 20, 2000).
  109. Id.
  110. Id.
  111. See FAR 9.104-1.
  112. See Ken M. Kanzawa, Legal and Practical Issues in Implementing Executive Order 13673: Fair Pay and Safe Workplaces, 44 Pub. Cont. L.J. 417, 426–28 (2015) (discussing the events preceding the revocation of the Clinton administration’s reform proposal).
  113. Federal Acquisition Regulation; Contractor Responsibility, Labor Relations Costs, and Costs Relating to Legal and Other Proceedings–Revocation, 65 Fed. Reg. 66,986 (Dec. 27, 2001).
  114. Federal Acquisition Regulation; Contractor Responsibility, Labor Relations Costs, and Costs Relating to Legal and Other Proceedings, 65 Fed. Reg. at 80,267 (amending FAR 9.104-1(d)) (amended portion in italics).
  115. Id. at 80,257 (amending FAR 9.104-3(c)).
  116. Id. (amending FAR 9.104-3(c)).
  117. Id. at 80,268 (amending FAR 9.103(b)).
  118. Id. (amending FAR 14.404-2; 15.503).
  119. See id.
  120. See infra Part VI.A.
  121. Executive Order No. 13,673, Fair Pay and Safe Workplaces, 79 Fed. Reg. 45,309 (July 31, 2014).
  122. Federal Acquisition Regulation; Fair Pay and Safe Workplaces, 81 Fed. Reg. 58,562 (Aug. 25, 2016).
  123. Guidance for Executive Order 13,673, Fair Pay and Safe Workplaces, 81 Fed. Reg. 58,654 (Aug. 25, 2016).
  124. For the purposes of this subpart, these three documents will be referred to collectively as the “Final Rule,” except where necessary to distinguish between the documents individually.
  125. See Associated Builders and Contractors of Southeast Texas v. Rung, No. 1:16-CV-425, 2016 WL 8188655 (E.D. Tex. Oct. 24, 2016); see also infra Part V.C.
  126. Act of Jan 6, 2017, Pub. L. No. 115-11, 141 Stat 75.
  127. “The Congressional Review Act of 1996 established expedited (or ‘fast track’) procedures by which Congress may disapprove a broad range of regulatory rules issued by federal agencies by enacting a joint resolution of disapproval.” Richard S. Beth, Cong. Research Serv., RL31160, Disapproval of Regulations by Congress: Procedure Under the Congressional Review Act i (2001).
  128. Exec. Order No. 13,782, Revocation of Federal Contracting Executive Orders, 82 Fed. Reg. 15,607 (Mar. 27, 2017).
  129. Federal Acquisition Regulation; Fair Pay and Safe Workplaces, 81 Fed. Reg. at 58,565.
  130. Executive Order No. 13,673, Fair Pay and Safe Workplaces, 79 Fed. Reg. at 45,309 (identifying the following 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; (M) the Age Discrimination in Employment Act of 1967; (N) Executive Order 13658 of February 12, 2014 (Establishing a Minimum Wage for Contractors); or (O) equivalent State laws, as defined in guidance issued by the Department of Labor)).
  131. Federal Acquisition Regulation; Fair Pay and Safe Workplaces, 81 Fed. Reg. at 58,639–58,644.
  132. Id.
  133. Id.
  134. Id.
  135. Id.
  136. See supra Parts V.A, V.B.
  137. See supra Part IV.
  138. For the purposes of this subpart, both the Clinton and Obama administrations’ proposed reforms will be referred to collectively as the “Proposed Reforms,” except where necessary to distinguish between the proposals individually.
  139. See supra Parts V.A, V.B.
  140. See Danielle Bereznay, Note, History Repeating: Déjà Vu of Failed Labor Law Regulations in Government Contracting, 47 Pub. Cont. L.J. 269, 273 (2018); Kanzawa, supra note 112, at 439; Cameron S. Hamrick & Roger V. Abbott, The Fair Pay and Safe Workplaces Regulations and Guidance Constitute an Unreasonable Use of Federal Authority, 46 Pub. Cont. L.J. 217, 227–29 (2017).
  141. Associated Builders & Contractors of Se. Texas v. Rung, No. 1:16-CV-425, 2016 WL 8188655 (E.D. Tex. Oct. 24, 2016).
  142. Id. at *6.
  143. Id. at *7.
  144. U.S. Const. amend. V.
  145. See Bereznay, supra note 140, at 281–82; Hamrick & Abbott, supra note 140, at 227–29; Sherrill & McQueen, supra note 98, at 289–300.
  146. Associated Builders, 2016 WL 8188655, at 11–12.
  147. Id. at 11 (citing Old Dominion Dairy Prods., Inc. v. Sec’y of Def., 631 F.2d 953, 962 (D.C. Cir. 1980)).
  148. See Sherrill & McQueen, supra note 98, at 284–86.
  149. See supra Parts V.A, V.B.
  150. Hamrick & Abbott, supra note 140, at 223–26.
  151. See id.
  152. See id. at 229–30; Sherrill & McQueen, supra note 98, at 285–86.
  153. Federal Acquisition Regulation; Fair Pay and Safe Workplaces, 81 Fed. Reg. at 58,564.
  154. See supra Part V.A, V.B.
  155. See Hamrick & Abbott, supra note 140, at 229–30; Kanzawa, supra note 112, at 437–40; Sherrill & McQueen, supra note 98, at 285–86.
  156. Bereznay, supra note 140, at 284–286; see also Associated Builders and Contractors of Se. Texas v. Rung, No. 1:16-CV-425, 2016 WL 8188655, at *13 (E.D. Tex. Oct. 24, 2016) (discussing the government’s failure during rulemaking to address plaintiff’s arguments regarding additional costs resulting from the Obama administration’s reform effort).
  157. See Kanzawa, supra note 112, at 434–37.
  158. See Federal Acquisition Regulation Case 2014-025, Fair Pay and Safe Workplaces Regulatory Impact Analysis Pursuant to Executive Orders 12,866 and 13,563 at 77–78 (Aug. 26, 2016) (Exs. 8–9).
  159. See id.
  160. See, e.g., HELP Committee Report, supra note 1, at 7–22 (citing research and examples); Senator Warren Report, supra note 5, at 3–4; see also supra Part III.
  161. HELP Committee Report, supra note 1, at 4.
  162. FAR 9.104-3(b).
  163. Federal Acquisition Regulation; Contractor Responsibility, Labor Relations Costs, and Costs Relating to Legal and Other Proceedings, 65 Fed. Reg. at 80,265.
  164. AR 9.104-6(c)(1).