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Contractor groups file lawsuit to block federal disclosure requirements

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Washington – The federal government’s Fair Pay and Safe Workplaces Executive Order 13673 final rule is unconstitutional and should be voided, according to a lawsuit filed Oct. 7 by Associated Builders and Contractors, its chapter in southeast Texas, and the National Association of Security Companies.

The rule states that prospective federal contractors must disclose any of 14 previous labor-law violations – including those related to safety and health, family and medical leave, civil rights protections, collective bargaining, and wages – whenever they bid for contracts valued at $500,000 or more.

ABC, which filed its lawsuit in the U.S. District Court for the Eastern District of Texas, Beaumont Division, claims the so-called “blacklisting” rule will force employers to divulge allegations of labor-law violations that have yet to be proved.

Interest in the rule is high among ABC members, who performed more than 60 percent of all federal government construction contracts from fiscal year 2009 to fiscal year 2015. In a national survey conducted by ABC in September, 93 percent of members said the final rule would make the contracting process less efficient, and 98 percent said the final rule would make the contracting process more expensive.

“The Obama Administration has exceeded its authority by forcing government contractors and prospective government contractors to publicly disclose mere accusations that they have violated labor and employment laws,” Ben Brubeck, ABC vice president of regulatory, labor and state affairs, said in an Oct. 11 press release. “ABC supports policies that provide value to taxpayers by ensuring that federal contractors compete on a level playing field, but this rule will require contractors to report alleged violations that have not been fully adjudicated and are being contested, which violates their first amendment and due process rights and is likely to harm fair and open competition in the federal marketplace.”

The final rule is set to go into effect Oct. 25.

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