Final closure for federal contractors awaits the president’s signature.
On March 6, 2017, the US Senate voted in favor of House Joint Resolution 37 (H.J. Res. 37), which would repeal the regulations spurred by former US President Barack Obama’s July 31, 2014 Executive Order on Fair Pay and Safe Workplaces in their entirety. Specifically, H.J. Res. 37, once signed by President Donald Trump, will revoke the paycheck transparency component of the regulations, which went into effect on January 1, 2017.
H.J. Res. 27 will also permanently nullify the other two components of the 2014 executive order involving labor violation reporting and arbitration restrictions. These two components were preliminarily enjoined by Judge Marcia Crone of the US District Court for the Eastern District of Texas on the eve of their effective date last October. H.J. Res. 37 uses the authority of the Congressional Review Act (CRA) to revoke the Federal Acquisition Regulation (FAR) implementing the Fair Pay and Safe Workplaces executive order in their entirety. The CRA is a little-used oversight tool under which members of Congress can review major rules enacted by federal agencies under delegations of authority from Congress. Under the CRA, Congress has at least 60 days to review an agency action. If Congress votes to object, it can repeal the agency regulations with the president’s signature. Once regulations are revoked under the CRA, agencies may not enact substantively similar future regulations without prior approval from Congress.
The Fair Pay and Safe Workplaces regulations sparked controversy from the day the FAR Council published the proposed rule and then-incomplete DOL guidance. The proposed rule drew more than 800 public comments, and the DOL guidance drew more than 7,000. Industry and regulators debated the rule and its requirements in the following months, and the FAR Council’s final regulations and accompanying guidance published in August 2016 provided little relief for federal contractors. The regulations were challenged by industry almost immediately, resulting in a federal court injunction that stayed all but the paycheck transparency provisions.
If you have any questions or would like more information on the issues discussed in this LawFlash, please contact any of the following Morgan Lewis lawyers:
San Francisco/Washington, DC
Robert J. Sherry
Sheila A. Armstrong
Paul C. Evans