The Department of Defense, General Services Administration and National Aeronautics and Space Administration (the FAR Council) have issued for publication in today’s Federal Register, a final rule amending the Federal Acquisition Regulation (FAR) to implement Executive Order 13673, Fair Pay and Safe Workplaces. The Department of Labor and the FAR Council have simultaneously issued final guidance and regulations implementing EO 13673, which is effective October 25, 2016.

The long-anticipated implementation of EO 13673 creates sweeping new disclosure and compliance obligations for government contractors that will fundamentally alter the relationships between prime and subcontractors. Vigorously opposed by the government contracting community, EO 13673 requires contractors to report civil and administrative decisions involving violations of federal and state labor and health and safety laws, for their own companies, as well as for their subcontractors. Contracting officers must consider violations of labor and health and safety laws when awarding contracts, exercising options, terminating contracts and making suspension and debarment referrals.

We are currently in the process of reviewing the lengthy regulations and an amendment to the Executive Order itself. We will provide further analysis in the weeks ahead.