Trump Eviscerates Federal Contracting Rules

(AP Photo/Robert F. Bukaty)

Workers watch a christening ceremony at Bath Iron Works from the bow of the future USS Michael Monsoor in Bath, Maine.

Republicans may not be adept at health-care legislation, but they are proving themselves immensely skilled at dismantling labor protections. Using the Congressional Review Act, an obscure legislative tactic that allows Congress to repeal recently enacted regulations with a simple majority and could forbid future administrations from promulgating similar rules, Republicans are rapidly unraveling a series of President Obama’s pro-worker rules that enraged powerful business associations like the U.S. Chamber of Commerce.

President Donald Trump is more than willing to facilitate the destruction of his predecessor’s legacy of worker protections. On Monday, behind closed doors and without his typical fanfare, Trump signed Congress’s repeal of Obama’s Fair Pay, Safe Workplaces executive order that would have mandated that companies with substantial federal contracts be required to disclose past violations of federal labor laws—such as wage and hour laws and workplace safety standards.

“President Trump had a choice today to either back the rights of workers employed by federal contractors to safe and fair workplaces, or to side with corporations that steal workers’ wages and cut corners on safety,” said Christine Owens, executive director of the National Employment Law Project, in a statement. By repealing the rule, “Mr. Trump cast his vote for big business.”

The rule’s repeal narrowly passed in the Senate—49-48 along party lines—in early March and, before that, along party lines in the House. The Fair Pay, Safe Workplaces executive order repeal is the first to be signed into law by Trump in what is a long line of expected labor regulation rollbacks that are working their way through Congress. Powerful business groups like the U.S. Chamber of Commerce, the Business Roundtable, and the HR Policy Association, among many others, have mounted an aggressive lobbying campaign against almost every Obama-era labor rule—particularly singling out the fair contracting rule, which it christened as the “blacklisting rule.”

“[The Fair Pay, Safe Workplaces rule] was a very common-sense action that underscored the basic principle that if you have the good fortune of doing business with the federal government, you should be complying with basic labor standards,” David Weil, who, as Obama’s wage and hour administrator, helped the Labor Department implement the executive order, says. “That, to me, does not seem to be an outrageous or partisan proposition.”

The rule aimed at raising standards across the economy by leveraging the federal government’s purchasing power; companies with federal contracts employ roughly one in five American workers. A report released by Massachusetts Senator Elizabeth Warren’s office found that of the federal government’s 100 largest contractors—which received a total of $241 billion in taxpayer money in 2015—66 have been cited for federal labor law violations.

More than 300,000 workers have been subject to wage and hour violations under federal contract over the past decade, the report found, while many companies are repeating violators who continue to receive federal contracts. Of the Occupational Safety and Health Review Commission’s 100 largest penalties against workplace safety violators, 35 percent were federal contractors.

Politico Magazine recently investigated a number of shipyard workers who were killed on the job due to workplace safety violations and were employed by companies that receive federal contracts to build ships for the United States Navy. “Shipbuilding is a dangerous industry,” reporter Jennifer Gollan wrote. “From 2005 through 2015, a total of 76 workers in the private shipbuilding and repair industry were killed. At least a quarter of those deaths involved private shipyards that are regular recipients of federal contracts. Shipyard workers face an injury and illness rate that is roughly 80 percent higher than construction jobs, according to the most recent federal labor figures. Failures by the companies make it more dangerous than it has to be. And the situation is about to get worse.”

With the rule scheduled to go into effect in late October, the Associated Builders and Contractors filed a lawsuit in federal court in Texas—where business groups have found reliably conservative judges willing to block Obama initiatives—and at the last minute a federal judge issued a preliminary injunction blocking most of the executive order from taking effect. Now, Trump and Congress’s fast-tracking of rule’s repeal sets the stage for gutting of other regulations that will directly protect workers.

“[The repeal] invites bad behavior on behalf of federal contractors and it forces high-road employers into the race to the bottom,” says Celine McNicholas, labor policy counsel for the Economic Policy Institute. She believes that using the Congressional Review Act (CRA) to repeal the rule could set a dangerous and far-reaching precedent because it blocks future administrations from implementing “substantially similar” regulations. “My concern is what does this say to federal contractors? Does it mean you get a free pass on federal labor laws? We don’t know what the definition of 'substantially similar' means in the CRA context.”

As of now, McNicholas says the message from Trump to federal contractors appears to be: Violate federal labor law freely and we’ll still contract with you.

While Trump could have unilaterally undone the rule using his executive power, it would have had to go through the same public rulemaking process that the Obama administration went through to enact the rule—an intensive and time-consuming ordeal. While Congress only used the 1996 law once before (to repeal a Clinton administration workplace ergonomics rule), Paul Ryan has already invoked the law several times.

In the past couple months alone, the House and Senate have voted to repeal an Obama rule that requires companies to keep records of workplace injuries and illnesses. Both chambers have also voted to repeal a rule that limits the extent to which states can require drug testing in order to receive unemployment benefits. Additionally, the House has passed a resolution repealing the Labor Department’s rule making it easier for states and localities to expand retirement savings options for workers.  

Trump’s repeal puts the interests of powerful corporations directly before the workers he pledged to lift up while on the campaign trail. And it’s just the latest indication that his administration favors deregulation for big-business barons and wage suppression for everyone else.

 

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