The Federal Acquisition Regulatory Council released a proposed rule and the U.S. Department of Labor issued proposed guidance as directed by President Obama’s July 2014 “blacklisting” Executive Order 13673, which instructs federal agencies to determine whether a prime contractor is “responsible” enough to receive a federal contract exceeding $500,000 based on a review of each company’s compliance history with 14 federal workplace, labor and safety laws on prior federal, local and private jobs within the past three years. Prime contractors also must determine similar responsibility for their subcontractors. 

According to Associated Builders and Contractors (ABC), the rule would create a cumbersome federal acquisition system that allows contracts to be awarded subjectively by unelected bureaucrats. Additionally, it could prevent some of the best federal contractors from winning future contracts, as well as result in more bid protests and more frequent and costly labor and employment disputes. ABC also contends the proposal will discourage small businesses from pursuing federal contracts and expose taxpayers and businesses to increased costs and risks. 

A final rule and guidance will be published and implemented once public comments have been reviewed. For more information, visit abc.org/blacklisting

At the congressional level, the U.S. House of Representatives passed 2016 appropriations bills for Commerce, Justice, Science and related agencies, as well as Housing and Urban Development and related agencies, without amendments that would have effectively prevented federal contractors with a Fair Labor Standards Act violation in the past five years from being awarded federal contracts funded by these bills. Both amendments failed on a large bipartisan basis.