Court Issues Preliminary Injunction Against Blacklisting Final Rule

On Aug. 24, the Federal Acquisition Regulatory (FAR) Council issued the final rule on blacklisting (also known as the Fair Pay and Safe Workplaces Executive Order 13673, issued July 2014) that will require federal contractors and subcontractors to disclose any "violations" of 14 federal labor laws and OSHA-approved state plans to the federal government before being awarded federal contracts covered by this rule.  The rule was accompanied by a guidance document issued by the DOL and a White House amendment to Executive Order 13673. ABC issued a press release slamming the final blacklisting rule immediately afterward.

On Oct. 24, the U.S. District Court for the Eastern District of Texas issued a nationwide preliminary injunction that prevents the FAR Council from implementing the final blacklisting rule, which was scheduled to take effect Oct. 25. Read ABC's press release here

Specifically, the court's decision blocks the federal government from implementing any provision of the FAR Rule or the DOL Guidance relating to the new reporting and disclosure requirements on government contractors and subcontractors and the restriction on arbitration agreements.  As a result, these provisions of the final blacklisting rule will not go into effect on Oct. 25.   

However, the preliminary injunction does not block implementation of the paycheck transparency provisions of the final rule. These paycheck transparency provisions are still scheduled to take effect on or after Jan. 1, 2017, requiring prime contractors and subcontractors with federal contracts of $500,000 or more (other than subcontracts that are for "Commercial Off-The Shelf items") to provide wage statements (including the number of hours worked, pay rate and any deductions), as well as notice of any independent contractor relationship and overtime exemptions to their covered workers.

ABC, its ABC Southeast Texas Chapter and the National Association of Security Companies filed a legal challenge on Oct. 7 and filed a motion for temporary restraining order and preliminary injunction on Oct. 13. ABC is represented by Maury Baskin of the law firm Littler Mendelson, PC, ABC's general counsel.  It is unknown at this time whether the U.S. government plans to appeal the district court's decision. Further developments on the legal challenge will be available in Newsline.   

To learn more about the impact of the decision, ABC's general counsel Littler Mendelson, P.C. has prepared an analysis of the court's ruling.  

For a detailed look at the final rule, watch ABC's archived webinar "Federal Contractors:  Learn About the Obama Administration's Final Rule on "Blacklisting."  A login is required.

 Additional information on the final rule can be found on the DOL's website.