Organized Labor Gets A Boost From Four New Executive Orders. Is The EFCA Next? 

(Published March 16, 2009)

 

Only a few weeks after taking his Oath of Office, President Obama issued four pro-union Executive Orders, reversing some of the pro-employer policies that had been implemented during the previous administration and imposing significant new obligations on federal contractors. On March 10, Democrats re-introduced the Employee Free Choice Act (EFCA) in both houses of Congress. President Obama has long supported the EFCA.

Under the EFCA, employers would be forced to recognize a union that has received signed union authorization cards from more than 50% of employees and would no longer be able to request a secret ballot election. Two weeks prior, Republicans introduced the Secret Ballot Protection Act into both houses.

The EFCA also requires binding arbitration if the employer and union cannot reach a collective bargaining agreement within 120 days. Employer penalties for unfair labor practices are also increased under the EFCA.

While the EFCA does not yet have President Obama's signature on it, here's a short summary of the new Executive Orders that do.

 

Notification Of Employee Rights Under Federal Labor Laws 

 

Notification Of Employee Rights Under Federal Labor Laws revokes Executive Order 13201, the "Beck Notice Requirements," which required employers to post a notice advising employees that they are not required to join a union or maintain a union membership in order to retain their jobs.

The new Executive Order imposes an obligation to inform employees of their rights under the National Labor Relations Act (NLRA). All qualifying federal contractors will be required to post a new notice advising employees of their rights to bargain collectively and to be protected in the exercise of their right to association, self-organization, and designation of representatives for purposes of negotiating terms and conditions of employment.

This Order also contains four new contract clauses that must be included in all qualifying government contracts and resulting subcontracts, effective immediately.

Tip: The Secretary of Labor has 120 days in which to prescribe the size, form, and content of the notice to be posted.

 

Nondisplacement Of Qualified Workers Under Service Contracts
 

Nondisplacement Of Qualified Workers Under Service Contracts revokes Executive Order 13204, which was issued in 2001 to remove the requirement that successive contractors offer a right of first refusal of employment to employees of the prior contractor.

The new Executive Order requires employers assuming government service contracts to offer their predecessor employers' employees the right of first refusal in positions for which they are qualified. The right of first refusal must last for at least 10 days.

Key implications: If the new employer draws a majority of its workforce from predecessor employees that are union members, the new employer may be forced to bargain with that union, even though the union has not been certified as its own employees' representative.

Tip: Labor costs may balloon unexpectedly if you find yourself having to hire your predecessor's unionized employees and, subsequently, having to bargain with that union, so keep the new successorship obligations in mind when deciding whether to bid on a government contract.

 

Economy In Government Contracting 

Economy In Government Contracting prohibits federal contractors from seeking reimbursement for the costs of any activities undertaken to persuade employees to join or — as is far more likely — not to join a union. So the cost of preparing anti-union materials, hiring legal counsel or consultants, holding meetings (including the cost of salaries for attendees), planning or conducting such persuasive activity, etc., are no longer reimbursable.

Tip: Federal contractors are not prohibited from engaging in such activities, but must take care to segregate reimbursable activities from disallowed expenditures when seeking reimbursement.

Use Of Project Labor Agreements For Federal Construction Projects 

Use Of Project Labor Agreements For Federal Construction Projects revokes Executive Orders 13202 and 13208. It authorizes executive agencies of the federal government to require every contractor or subcontractor on a large-scale construction project (where the total cost to the federal government is at least $25 million) to negotiate or become a party to a Project Labor Agreement (PLA). A PLA is a pre-hire collective bargaining agreement with one or more unions that establishes the terms and conditions of employment for a specific construction project.

Tip: Concerned that once your non-union employees are represented by a union on a PLA, the employees might seek representation on other work? Make sure the PLA does not include language that will automatically extend the terms of the agreement to the rest of your operations.

 

 

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