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Congress Passes Rollback of Contractor Accountability Measure

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On Monday, a resolution overturning rules implementing the Fair Pay and Safe Workplaces executive order cleared the Senate and was sent to the White House. The measure blocks Labor Department regulations requiring contractors to disclose to the government their labor law violations, provide employees information needed to verify the accuracy of paychecks, and allow employees to file discrimination and sexual assault and harassment claims in court. The measure also negates the EO’s requirement that agencies evaluate the labor law violation information—which would have been collected in the Federal Awardee Performance and Integrity Information System (FAPIIS) database—as part of the contract award process.

That day, Senator Elizabeth Warren (D-MA) released a staff report warning that undoing these and other contractor employee protections will have dire consequences for taxpayers and for the tens of millions of American workers employed by federal contractors.

The report documented the extent to which federal contractors violate laws guaranteeing fair wages and safe, non-discriminatory work environments. Among the key findings:

  • More than 300,000 employees of nearly 12,000 contractors were the victims of wage-related violations in the last decade.
  • Nearly 700 companies were caught violating wage laws multiple times. Many of these repeat offenders continued to receive millions, even billions, of dollars in contracts despite the law allowing the government to ban companies from contracting if they commit an “offense indicating a lack of business integrity or business honesty.”
  • Of the federal government’s 100 largest contractors—which received a combined total of nearly $240 billion in contracts in 2015—66 were caught breaking federal labor laws.
  • AT&T had the most wage and hour law violations, with nearly 30,000 since 2005.  
  • Of the 100 largest workplace health and safety penalties imposed by the Occupational Safety and Health Administration since 2015, more than a third were issued to companies that were awarded federal contracts within the last decade. Every one of these penalties, which ranged from $150,000 to $1.4 million, resulted from serious, willful, or repeat violations.

The report’s grim conclusion: “If President Trump and Congressional Republicans roll back basic protections for the employees of federal contractors, the consequences will be dire—for workers’ paychecks and health and physical safety and for taxpayers, who, if current patterns continue, will be sending billions of dollars to companies that skirt wage requirements and cut corners on workers’ safety.”

Warren’s research built on a 2010 Government Accountability Office (GAO) report that found half of the 50 largest wage violations were committed by federal contractors, and a 2013 Senate Health, Education, Labor, and Pensions (HELP) Committee report that found almost one-third of the companies penalized for violating federal wage and health and safety laws were contractors. The HELP Committee also found that 42 workers died as a result of the workplace health and safety violations by eight contractors.

Warren’s report didn’t cite the Center for American Progress Action Fund (CAP Action), which took the 2010 GAO report one step further. Reviewing the same universe of companies analyzed by the GAO, CAP Action found that one-quarter of the federal contractors responsible for the most workplace violations also had significant contract performance problems, such as fraud and cost overruns.

We hope the elimination of the labor law violation disclosure rule will not have a negative effect on federal contractor oversight. Some companies have been voluntarily reporting these violations in the FAPIIS database, but it’s barely a trickle of information. A golden opportunity to amass a large quantity of contractor responsibility data in one centralized location has been lost.

Fortunately, the impact of this rollback may be mitigated because contracting officials have a growing array of online data resources at their disposal. In addition to FAPIIS, there are a variety of free online corporate accountability tools, such as POGO’s Federal Contractor Misconduct Database and Good Jobs First’s Violation Tracker—which contains some of the violation data contractors would have been required to disclose—and corporate rap sheets.

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By: Neil Gordon
Investigator, POGO

Neil Gordon, Investigator Neil Gordon is an investigator for the Project On Government Oversight. Neil investigates and maintains POGO's Federal Contractor Misconduct Database.

Topics: Contract Oversight

Related Content: Congressional Oversight, Contractor Accountability, Federal Contractor Misconduct, Transparency in Contracting

Authors: Neil Gordon

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