Executive Order 13496 - On May 20, 2010, the Department of Labor ("DOL") published its final rule implementing President Obama's Executive Order 13496. This Order requires all who contract or subcontract with the federal government's nonexempt departments and agencies to post notices informing their employees of their rights under federal labor laws. Generally, covered contractors are those with contracts that meet or exceed $100,000.00. Subcontractors whose work is "necessary to the performance of the prime contract," in an amount of at least $10,000.00, are also covered. As a result, the Order applies to far more employers than might be imagined, including financial institutions and a broad array of businesses that receive federal monies.

Executive Order 13496 was signed by President Obama on January 30, 2009, just days after his inauguration. Most employers saw no need for mandating workplace notices to employees informing them of their rights under the National Labor Relations Act ("NLRA") and the Order has been seen largely as a favor to labor unions that supported the president's election campaign. This view was bolstered by the initial proposed rule and notice issued by the DOL on August 3, 2009, as they were very one-sided and appeared to promote unions to employees. Indeed, many of our clients and friends in the business community were outraged at the proposed rule. As a result and on their behalf, Wessels Sherman submitted an elaborate analysis to the DOL arguing for a more neutral position on unions. Among other things, our comments objected to the proposed notice's initial declaration that had stated: "It is the policy of the United States to encourage collective bargaining...." We also argued for more balance in the notice by giving equal attention to unfair labor practices by unions, rather than advising employees only of employer misconduct.

We are pleased to say that Wessels Sherman's comments received particular attention from the DOL in footnote 1 of its final rule: "The Department received a single request to extend the comment period for an additional 30 days. The commenter, a law firm, asserted that the 30-day comment period was too brief and that, as a result, many interested parties were unaware of the proposed rule.... The commenter requesting the extension was able to submit a lengthy, substantive comment within the 30-day period and attached additional comments from many of its clients." We are grateful to the dozens of employers who took the time to provide us with their comments, objections and input on the proposed rule. Your involvement added clout to our comments, which we believe resulted in major improvements in the final notice covered employers must now post. The final notices are much more neutral between employers and unions and the DOL dropped the inflammatory declaration of encouraging union bargaining that was stated in the proposed notice.

The final rule goes into effect June 19, 2010, and all applicable contracts and modifications entered into after that date must be in compliance.

RELEVANT AVAILABLE INFORMATION:

For a copy of Wessels Sherman's comments on the proposed rule submitted to the DOL by Attorney James Sherman, visit our firm's website at: http://www.w-p.com/CM/NewsEvents/DOL%20COMMENTS_001.pdf or contact Jim Sherman at jasherman@wesselssherman.com, or (952) 746-1700.

For a copy of the final notice, along with other explanatory information, visit the DOL's website at: www.dol.gov/olms/regs/compliance/EO13496.htm

Finally, if interested, the DOL's Office of Federal Contract Compliance Program ("OFCCP") is conducting a webinar on June 10, 2010, 2:00 p.m. - 3:30 p.m. Eastern Daylight Time.

This webinar will further assist in explaining how to comply with the new rule. Information on how to reserve your seat for the seminar can be found at https://www1.gotomeeting.com/register/696425736.

Executive Order 13502 - On May 12, 2010, another final rule was implemented on another labor related Executive Order signed by President Obama. The Order encourages but does not require federal agencies to impose so-called "Project Labor Agreements" (PLAs) on a case by case basis for qualifying federal construction projects. PLAs typically are negotiated with labor unions and mandate only union contractors and may provide a variety of other pro-union clauses, such as union access to premises, employees, etc. Needless to say, this Order is anything but neutral on unions.