Earlier this month, the National Labor Relations Board (NLRB) General Counsel instructed the agency's regional offices to report any complaints they issue against federal contractors to labor compliance officers. These officers were created by an Executive Order and assist in federal agencies’ contracting decisions. The Order, issued by President Obama on July 31, 2014, requires federal contractors and subcontractors to publicly report labor violations, to forgo the use of mandatory arbitration agreements, and to ensure paycheck transparency.

Through its recent memorandum, the NLRB General Counsel requires regional offices to request any employers accused of unfair labor practices to provide their status as a federal contractor and, if applicable, their Commercial and Government Entity, Data Universal Numbers System, and Employer Identification or Taxpayer Identification numbers. Should the regional offices find that unfair labor practices occurred and proceed to issue a complaint, according to the memorandum, they then will communicate the information to labor compliance officers. This information will play a role in the employers' ability to obtain new federal contracts.

The implication of the memorandum is clear: the NLRB plans to use employers' status as federal contractors, subcontractors, or potential contractors to dissuade them from committing unfair labor practices in the eyes of the agency and to leverage settlements of charges prior to issuance of a complaint. Indeed, the memorandum states that charges will not be reported if settled before the agency relies on them as the basis for a complaint. Thus, while all employers should monitor the NLRB's decisions and enforcement guidance, federal contractors should take particular note of the agency's pronouncements to avoid any complications related to their contractor status.