“Blacklisting rule” abolished and sent to Trump

On March 7, the Senate approved a resolution rolling back the Federal Acquisition Regulation and Department of Labor’s related guidance implementing President Barack Obama’s Executive Order on Fair Pay and Safe Workplaces—the so-called “blacklisting rule.” The 49-48 vote fell strictly along party lines, with Republicans favoring the measure and Democrats and two Independents voting against it; three Republicans did not vote. H.J. Res. 37 now heads to President Trump’s desk for signature. While Trump has proven difficult to predict, the fact that the resolution abolishes a regulation lines up with his aggressive deregulation agenda, and so he will likely approve it.

The final rule that will be undone if Trump signs the resolution of disapproval, among other things, required prospective contractors to disclose violations of 14 basic workplace protections from the last three years, including those addressing wage and hour, safety and health, collective bargaining, family and medical leave, and civil rights protections. It also barred federal contractors from enforcing mandatory pre-dispute arbitration agreements as to workers’ claims of sexual assault or civil rights violations. Additionally, H.J. Res. 37 will prevent implementation of the entire rule, including the paycheck transparency requirements that were not previously enjoined.

Unnecessary and unhelpful?

Senators Ron Johnson (R-Wis.), chairman of the Senate Homeland Security and Governmental Affairs Committee and Lamar Alexander (R-Tenn.), chairman of the Senate Committee on Health, Education, Labor, and Pensions (HELP), applauded the passage of the resolution.

“Overturning this harmful rule will reduce the regulatory burden plaguing our economy,” Johnson said in a statement. “This rule could potentially be used to blackmail innocent businesses during labor negotiations. The Obama administration admitted that this rule would cost at least $398 million each year to comply with, but failed to quantify any benefit whatsoever. Repealing this rule is a step in the right direction by providing the regulatory relief that is necessary to unleash the American economy so that it can realize its full potential.”

“The Senate today did the right thing by overturning the harmful Obama Administration “blacklisting” regulation that could have prevented our nation’s federal contractors from receiving a federal contract for an alleged labor violation before any wrongdoing has been proven,” Alexander added. “I’m urging President Trump to sign this legislation as soon as possible.”

Federal contractor violations

Democrats pushed hard against the resolution, noting that in 2013, the HELP Committee conducted an investigation which found that nearly 30 percent of the companies that received the most severe penalties for worker safety and wage law violations were federal contractors.

A report released by Senator Elizabeth Warren (D-Mass.) on the day of the vote showed that 66 of the federal government’s 100 largest contractors have been caught breaking federal wage and hour laws. In addition, more than a third of the 100 largest penalties levied by OSHA since 2015 were issued to companies that held federal contracts.

Senator Patty Murray (D-Wash.), Ranking Member HELP Committee, speaking on the Senate floor, said: “For too long, the government has awarded billions of taxpayer dollars to companies that rob workers of their paychecks and fail to maintain safe working conditions. This rule helps right that wrong. Under this rule, when a company applies for a federal contract, they will need to be upfront about their safety, health, and labor violations over the past three years. That way, government agencies can consider an employer’s record of providing workers with a safe workplace and paying workers what they have earned—before granting or renewing federal contracts.”

“When workers arrive on the job, they deserve to know that they will be treated fairly; they will be provided with safe and healthy workplaces; their right to collective bargaining will be respected; and that they will be paid all of the wages they have rightly earned,” Murray continued. “And businesses that contract with the government should set an example when it comes to each of these concerns—and taxpayer dollars should only go to businesses that respect these fundamental worker protections.”

H.J. Res. 37 uses a procedural move under the Congressional Review Act that permits Congress to pass a resolution of disapproval to prevent, with the full force of the law, a federal agency from implementing a rule or issuing a substantially similar rule without congressional authorization.

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