Federal Contractors Get $81 Billion for Breaking the Law. Now That’s Going to Change
By Abigail Bar-Lev, National Women’s Law Center
If you were to break the law, you wouldn’t expect special treatment, right? If you were to violate someone else’s rights, you wouldn’t expect to get paid for it. And you certainly wouldn’t expect tax dollars to support your bad behavior.
Yet that is exactly what’s happening in the world of federal contracts. Some federal contractors are breaking the law, and they receive billions of dollars for more contracts straight from the public’s wallets.
How many billions? A Senate report found that 49 contractors who violated federal labor laws [PDF] nearly 1,800 separate times in a five-year period were then awarded $81 billion in federal contracts. $81 billion!
For those federal contractors, that $81 billion is a reward for shrugging off responsibilities under the law, in some case even putting workers in serious danger and discriminating against employees. The American people still paid.
Clearly something has to change.
On July 31, 2014, President Obama signed the Fair Pay & Safe Workplaces Executive Order to begin to build a process within the federal government that would hold those federal contractors who get some of the largest amounts of money in federal contracts accountable for their violations. This summer, government agencies have begun to implement the Executive Order with proposed rules.
But not everyone agrees.
Unfortunately, some in the business community have protested these important rules. But their arguments are shallow and short-term. They worry about making the contracting process more complicated and that it will cost businesses money. But those arguments fail to account for the fact that the Executive Order and proposed rules apply only to companies with federal contracts over $500,000. And much of the proposed rules focus on what government can do to assist contractors and streamline the reporting process.
It makes no sense to continue rewarding bad, illegal behavior with tax dollars.
The Executive Order and proposed rules are the right solution.
The Order and proposed rules set up a process to hold contractors who are awarded some of the most lucrative federal contracts accountable for major violations of the labor laws they’ve committed in the past three years prior to bidding on a contract. Contractors must report their violations, but are given opportunities to present mitigating factors on their behalves at every turn, and the government will work with contractors to identify appropriate remedies. The goal is to help contractors continue to earn contracts—while following the law. Companies that have the privilege of doing business with the federal government should at least be following the law. That is what the American people—who ultimately pay for the federal contracts—expect and it is what they deserve.