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Obama order requires contractors to disclose past labor violations

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in Employment Law,Human Resources

President Obama has signed an executive order that will force companies seeking to do business with Uncle Sam to reveal whether they have violated any labor laws within the last three years. Those that have would be barred from receiving any federal contracts worth $500,000 or more.

The order comes on the heels of other administration actions designed to compel federal contractors to adopt more worker-friendly policies.

On July 21, Obama signed an order prohibiting contractors from discriminating against gay and transgender employees and applicants. Earlier this year, an executive order raised the minimum wage for employees of federal contractors to $10.10 per hour starting in 2015.

The new executive order targets contractors that have violated wage-and-hour, anti-discrimination and workplace safety laws.

“While the vast majority of federal contractors play by the rules, every year tens of thousands of American workers are denied overtime wages, not hired or paid fairly because of their gender or age, or have their health and safety put at risk by corporations contracting with the federal government that cut corners.  Taxpayer dollars should not reward corporations that break the law,” said a White House statement.

Mandatory disclosure of past violations is designed to help current federal contracting officers decide whether to award new contracts. The process is “structured to encourage companies to settle existing disputes, like paying back wages,” the White House statement said.

The executive order also limits contractors’ ability to require arbitration to resolve employees’ discrimination and harassment claims.

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