By Robert Hiltonsmith, Demos
Do you think companies should be required to pay their employees at least the minimum wage? Comply with workplace safety regulations? Pay employees for every hour they work?
It would seem ridiculous for anyone to answer “no” to these questions. Yet Congressional Republicans and the Trump administration apparently believe that these extremely basic workplace protections are too onerous to ask U.S. businesses to uphold. As we speak, they’re working to repeal the “Fair Pay and Safe Workplaces” executive order, which simply suggests that agencies consider whether federal contractors comply with these and other basic labor laws in the contracting process. Yet all it took was a letter from several organizations of companies that do business with the federal government falsely arguing that the order “blacklists” companies from the contracting process to convince Republicans to move the next day to repeal these basic protections.
Yet in reality, the text of the actual executive order makes clear that it does no such thing. Rather, the order simply requires that companies bidding on federal contracts worth $500,000 or more merely disclose any labor or workplace safety law violations in the last three years. Far from banning such companies from receiving contracts, the order in fact allows firms to explain any mitigating circumstances that led to a violation during the bidding process. Isn’t this a good thing? After all, since companies that contract with the federal government employ a quarter of all private sector workers, if we want private sector firms to obey basic labor laws, it seems logical to incentivize their compliance through one of most effective channels of influence the federal government has on the private sector.
And it’s not as if this executive order is simply adding another unnecessary layer of bureaucracy to the contracting process, as if nearly all would-be contractors have spotless labor and safety records. In our report documenting the need for the “Fair Pay and Safe Workplaces” executive order, we found that labor and safety violations are rampant among federal contractors. By linking the Department of Labor’s Enforcement Data with federal contracting data from USASpending.gov, my colleague Amy Traub and I found that 40 percent of all contracting dollars awarded in 2013 went to a company that had at least one major health, safety, or wage violation on their record. We also estimated that federal contractors cheat their employees out of between $1.6 billion and $2.5 billion in wages just through violating minimum wage laws. It seems clear that if we believe that companies should obey basic wage and safety laws, requiring the disclosure of violations of such laws if they wish to receive some of the nearly $500 billion in federal contracts awarded each year would be an important step.
It seems unimaginable that we’re even fighting this fight, particularly so early in the administration of a president whose claims to represent the interests of average Americans were central to his campaign. The few justifications espoused by the members of congress who support the repeal only reinforce just how ridiculous the effort is. Rep. Virginia Foxx (R-Va.), one of the repeal’s co-sponsors, claims that the rule wrongly empowers government agencies “to deny federal contracts for alleged violations.” But these violations are more than alleged. These are convicted violators, determined to be in violation after extremely thorough investigations by the Department of Labor and other agencies. Rep. Foxx also claimed that the rule keeps some small businesses from receiving contracts, yet the rule explicitly exempts contracts worth less than $500,000, precisely the contracts most small businesses would be competing for. In reality, repealing the executive order would hurt small businesses, forcing them to compete with firms who can undercut other bidders by cutting corners on safety or paying their workers less than the minimum wage.
No, the only rational explanation for Congress’s push to repeal the “Fair Pay and Safe Workplaces” executive order is that they simply don’t care about workers or businesses that follow the rules. Perhaps the Senate, who will vote today on the measure, will come to its senses and kill this anti-worker, anti-law-abiding-business resolution before it’s too late.