Obama aims to halt labor-law violations

Posted: August 1, 2014 at 2:56 a.m.

President Barack Obama speaks before signing an executive order titled Fair Pay and Safe Workplace on Thursday at the Eisenhower Executive Office Building on the White House grounds in Washington.

WASHINGTON -- President Barack Obama signed an executive order Thursday to improve working conditions for employees of federal contractors, some of whom have gone on strike over what they contend are unfair labor practices by companies doing business with the U.S. government.

The order requires companies to disclose labor-law violations from the past three years and provides guidance to federal agencies on how to weigh the black marks when awarding contracts, according to a White House fact sheet.

"Our tax dollars shouldn't go to companies that violate workplace laws," Obama said as he signed the order. "If a company is going to receive tax dollars, it should have safe workplaces."

The Obama administration has stepped up efforts aimed at improving working conditions for contractor employees, such as raising the minimum wage to $10.10 an hour. Labor unions that typically vote for Democrats also have been pushing for tougher standards on overtime and workplace safety.

Thursday's order applies to federal purchase contracts with a value of more than $500,000, and will take effect in stages during 2016, according to the White House. There are about 24,000 businesses with federal contracts, employing about 28 million workers, according to the U.S. Labor Department.

"The vast majority of contractors play by the rules," Obama said. "The ones that don't play by the rules, they're not just failing the taxpayers; they're failing all of us."

Business groups said the executive order could complicate working for the government.

John Engler, president of the Business Roundtable, a Washington-based group that includes chief executives of the largest U.S. companies, said the order may encourage more lawsuits against businesses.

"It'll be dressed up -- we're protecting these rights or this rights -- but when you strip it all away, more work for trial lawyers," Engler said.

Geoff Burr, vice president of government affairs for the Associated Builders and Contractors, a Washington-based group for construction companies, said in a statement that the "subjective nature of the order opens the door to favoritism and abuse of government contractors by administration officials."

But Larry Cohen, president of the Communications Workers of America, which represents 700,000 public and private workers, said the order would establish a mechanism to ensure workers are treated fairly.

Obama in January signed an executive order to raise the minimum wage paid by federal contractors. Workers, while welcoming the raise, have said it isn't enough, and they've pushed for other steps, like action to prevent unpaid off-the-clock work and to enforce workplace safety rules.

In the past year-and-a-half, employees of federal contractors have gone on strike nine times to protest low wages and labor law violations. The latest protest took place Tuesday when employees at federal worksites at Union Station, the Pentagon, the Smithsonian museums and the National Zoo walked off their jobs in the Washington area.

Democrats in Congress have pushed for more protections. Reps. Keith Ellison of Minnesota and Raul Grijalva of Arizona, the co-chairmen of the Congressional Progressive Caucus, urged Obama to issue a "Good Jobs Executive Order" in a July 24 letter. It cites a report by Demos, a New York-based public policy group advocating for workforce changes, that said many federal contracting jobs provide poverty-level wages.

Sen. Tom Harkin, an Iowa Democrat and chairman of the Senate labor committee, released a report in December showing that companies with significant violations of labor laws had won more than $80 billion in federal contracts in 2012.

Citing a study by the Center for American Progress and the University of California at Berkeley released in 2009, the report said companies that do business with the federal government employ about 22 percent of the nation's workforce.

Obama's action "will be an important step forward to give the government more tools to effectively confront and deter workplace wage and safety violations," Harkin said Wednesday.

Federal contracting officers already must assess the records of companies applying for contracts. The executive order is designed to make it easier for them to find past violations and requires the Labor Department to assess the severity of the employer's actions.

Under the order, potential contractors must disclose labor law violations in 14 federal or equivalent state laws before they can get a contract.

Information for this article was contributed by Mike Dorning, Brian Wingfield and Roger Runningen of Bloomberg News.

A Section on 08/01/2014