Before taking office, President Trump vowed to revoke “all illegal and overreaching executive orders.” On March 27, he made good on that vow when he revoked former President Obama’s Executive Order 13673, the Fair Pay & Safe Workplaces rule (“EO”), known by many as the “Blacklisting EO”.
As we reported on July 24, 2016, Obama enacted the EO back in 2014 with the goal of promoting efficient procurement of government contracts with businesses “who comply with labor laws.” Among other things, the EO would have required companies with government contracts valued at $500,000 or more to report violations under 14 labor and employment laws, including the FLSA, FMLA, Title VII, ADA, ADEA, OSHA, NLRA, federal contractor laws and any equivalent state and local laws. Based on the severity of a company’s infractions (or in some cases, mere allegations of infractions), the government could disqualify or outright bar that company from bidding for future federal contracts.
The EO was subject to controversy immediately after execution and received substantial pushback from the legislative and judicial branches alike. Many Congressional Republicans argued that the rule smacked of a lack of due process by allowing federal agencies to deny contracts to bidders based on “alleged” violations of various federal labor laws. And last October, a federal court enjoined a majority of the EO. The penultimate death knell sounded on March 7, when the Senate passed a joint resolution (based on the House’s prior resolution), which “disapproved” of the EO and set the stage for full revocation. The joint resolution then went to the President, who signed it on Monday.
So what does the revocation mean for current and potential federal contractors? In short, the Fair Pay & Safe Workplaces EO is now dead in the water, and the pending injunction against it is moot. As a result, federal contractors will not be required to report alleged labor violations to federal agencies during the bid process. In addition, they are not prohibited from entering into mandatory arbitration agreements concerning Title VII claims. Finally, they are no longer required to implement procedures to comply with required paycheck transparency. This final requirement—which took effect January 1—was the one part of the EO not enjoined last year. Employers can now roll back the paycheck transparency requirements if they wish to do so.
Interestingly, because of the procedure used by Congress to revoke the EO, the EO cannot be reissued in substantially the same form or via a new rule that is substantially the same, “unless the reissued or new rule is specifically authorized” by a new law. In other words, unless Congress expressly authorizes it (which is doubtful given the Republican majorities in both houses), we are unlikely to see another version of the Fair Pay & Safe Workplaces EO anytime soon.
Farewell, Blacklisting EO; we hardly knew ye.