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Employers Protest Pro-Worker Proposals Tacked on to Defense Bill

July 13, 2022, 9:01 PM

Tucked into the 650 proposed amendments to the annual defense authorization bill are a handful of pro-worker provisions that quickly drew the ire of business groups.

US House Democrats proposed amendments ranging from prohibiting the Department of Defense from contracting with employers who have engaged in unfair labor practices to giving a preference to union-friendly contractors.

The changes look to further President Joe Biden’s effort to promote unionization among government contractors and revive Obama-era rules to crack down on those that break labor laws. They also show how the defense budget can be used as an unlikely vehicle to shape labor standards across the federal sphere.

But management-side attorneys at Littler Mendelson P.C. called the proposals “radical labor policy amendments that would be incredibly detrimental to the nation’s defense contractors” in a July 12 letter to House leadership. The Coalition for a Democratic Workplace also penned a letter on July 11 to House lawmakers, saying the proposals “do not belong on this bill.”

“These partisan labor amendments contain previously failed policies that are overreaching and overly restrictive,” Littler Mendelson’s Workplace Policy Institute heads Shannon Meade and Michael Lotito wrote.

Labor Amendments

The National Defense Authorization Act (H.R. 7900) for fiscal 2023 proposes about $839.3 billion for the Pentagon, Energy Department, and other agencies. The US House is set to debate the record number of amendments Wednesday.

This isn’t the first time pro-worker legislation has been tacked on to NDAA. Millions of federal workers were granted 12 weeks of paid parental leave this way in 2019. Beginning in 2020, workers who had been on the job for more than a year could access the benefit.

The House Rules Committee Tuesday approved several amendments, clearing them for debate on the floor:

  • An amendment by Rep. Pramila Jayapal (D-Wash.) would require all agencies—not just the Department of Defense—to cut ties with contractors that violate the Fair Labor Standards Act, the federal law governing hours and wages. It would apply to those with two or more violations in the past five years.
  • An amendment by Rep. Mondaire Jones (D-N.Y.) similarly would prohibit the Defense Department from contracting with a company found to have committed an unfair labor practice under the National Labor Relations Act—also known as “union busting"—within the last three years.
  • An amendment by Rep. Jan Schakowsky (D-Ill.) would give preference to contractors that enter into neutrality agreements with unions, and agree not to replace workers who go on strike.
  • An amendment from Rep. Alexandria Ocasio-Cortez (D-N.Y.) would instruct the Labor Department’s Office of Federal Contract Compliance Programs to move ahead with regulations on how it will identify during compliance audits employers that illegally inquire about criminal histories in employment, after so-called “ban the box” legislation took effect last year.

Jayapal said in an interview that her amendment is part of a broader effort to stop bad actors from taking taxpayer money.

“We’re saying to the taxpayers that we’re being respectful of their dollars by only supporting companies that follow the law,” Jayapal said. “It doesn’t seem that complicated, really.”

A number of the amendments echo legislation that’s already been proposed, like Rep. Joyce Beatty’s (D-Ohio) bill to remove employment barriers for workers with criminal histories pursuing jobs in federally insured financial institutions. The House passed what is known as the Fair Hiring in Banking Act (H.R. 5911) in May.

Rep. Lois Frankel (D-Fla.) proposed an amendment that would ban contracts or grants for employers that mandate pre-dispute nondisclosure agreements for allegations of sexual harassment or assault—a narrowed version of her bill known as the SPEAK Out act, which the House Judiciary Committee advanced Wednesday.

The political divisions of the NDAA can be tricky for Democrats. Progressives tend to withhold support of the sprawling defense bill, Jayapal said, requiring moderates to partner with Republicans who don’t like unions. Jayapal said she’s confident the House will approve her amendment, but it may not survive in the Senate.

Schakowsky said it’s “fair enough” to establish parameters for federal contractors vying for tax-payer dollars. The requirements may also pressure companies with known union-busting tactics—like Amazon.com Inc.—to change their practices when it comes to organized labor.

“We’re talking about a lot of money,” she said.

To contact the reporters on this story: Paige Smith in Washington at psmith@bloomberglaw.com; Ian Kullgren in Washington at ikullgren@bloombergindustry.com

To contact the editors responsible for this story: Martha Mueller Neff at mmuellerneff@bloomberglaw.com; Genevieve Douglas at gdouglas@bloomberglaw.com