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August 7 2014

Federal Contractors to POTUS: Back Off!

Patrice J. Lee

President Obama has gone too far in the eyes of federal contractors and they are speaking out.

Business groups plan to fight the president’s latest unilateral actions that will require greater disclosure on labor law violations and create advisors to “police” agencies. This is added scrutiny on top of other orders requiring them to pay higher minimum wages and forcing them to disclose demographic data.

As we reported yesterday, the Obama administration has plans to issue new regulations that require federal contractors to disclose what they pay employees by sex, race, and other categories.

The President’s latest executive action will require companies to fess up to even relatively labor law violations, which might prompt companies to settle labor disputes that they might ordinarily win. It's another shaming tactic under the banner of transparency used to advance a particular agenda with no regard to law or common sense.

Finally, federal contractors are saying enough is enough.

The Hill reports:

Business interests are vowing to fight President Obama’s executive order imposing new restrictions on companies who want to do business with the federal government.

...

But contractors, already facing executive orders requiring them to pay a higher minimum wage and subjecting them to additional anti-discrimination rules, say the president went too far.

“We are concerned these sweeping changes threaten the due process rights of federal contractors and conflict with existing federal procurement and labor law,” said Geoff Burr, vice president of government for Associated Builders and Contractors. “ABC and the federal contracting community across all industries are prepared to fight this order in the courts and in Congress.”

John Meyers, a labor and employment lawyer at the firm Barnes & Thornburg, said federal funding cuts, including those linked to  sequestration, have been particularly painful for contractors.

The new requirements represent additional costs for companies vying for contracts from Uncle Sam, he said....

Workers rights advocates and unions heralded the order, which applies to roughly 24,000 businesses with federal contracts, employing about 28 million workers, according to Labor Department figures.

Two other valid arguments contractors make are the added financial and resources burdens that new reporting requirements will introduce and the repercussions contracts may face such as being “blacklisted” for minor missteps. The first is a new cost of business -it's the stick to the the carrot of working with government. The latter is a serious risk that can be ruinous for a company. Operating with integrity should be a value of every company and fostered in the culture to avoid infractions, but minor infractions due occur and should be treated as such.

Independent Women’s Forum’s mission is to improve the lives of Americans by increasing the number of women who value free markets and personal liberty. Sister organization of Independent Women’s Voice.
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