SECTION 1. FEDERAL CONTRACTS TO REQUIRE COMPLIANCE WITH STATE WORKMEN'S 
              COMPENSATION LAWS.

    (a) In General.--(1) Title III of the Federal Property and 
Administrative Services Act of 1949 (41 U.S.C. 251 et seq.) is amended 
by inserting after section 303G (41 U.S.C. 253g) the following new 
section:

``SEC. 303H. COMPLIANCE WITH STATE WORKMEN'S COMPENSATION LAWS.

    ``(a) Compliance Required.--Each contract for the purchase of 
property or services made by an executive agency shall provide that the 
prime contractor (and any subcontractor performing work on the contract 
under the prime contractor) shall guarantee throughout the performance 
of work under the contract to comply with the workmen's compensation 
law of each State in which work under the contract will be performed.
    ``(b) Termination of Work on Failure to Demonstrate Compliance.--
Each such contract shall contain the further provision that in the 
event the contracting officer determines that the prime contractor (or 
any subcontractor under the contract) is not in compliance with the 
workmen's compensation laws of any State within which work under the 
contract is being carried out, the Government may terminate the right 
of the offending contractor or subcontractor to proceed with the work 
or such part of the work being carried out in a State in which 
compliance with the workmen's compensation laws is not demonstrated. 
Notice of such termination shall be provided in writing to the 
offending contractor or subcontractor. If, within a reasonable time, 
the offending contractor or subcontractor has not demonstrated 
compliance with the workmen's compensation laws of such State, 
including payment of any fines or penalties assessed for failure to 
carry workmen's compensation insurance, the Government may complete the 
work. The contractor and any sureties of the contractor shall be liable 
to the Government for any excess costs occasioned the Government as a 
result of the termination.
    ``(c) Exceptions.--This section shall not apply in the case of 
contracts covered by the Defense Base Act (42 U.S.C. 1651 et seq.) or 
the Longshore and Harbor Workers' Compensation Act (33 U.S.C. 901 et 
seq.).
    ``(d) Suspension of Section.--In the event of a national emergency, 
the President may suspend operation of this section.''.
    (2) The table of contents at the beginning of such Act is amended 
by inserting after the item relating to section 303G the following new 
item:

``Sec. 303H. Compliance with State workmen's compensation laws.''.
    (b) Special Rule for Defense Contracts.--(1) Chapter 137 of title 
10, United States Code, is amended by adding at the end the following 
new section:
``Sec. 2332. Compliance with State workmen's compensation laws.
    ``(a) Compliance Required.--Each contract for the purchase of 
property or services made by the head of an agency shall provide that 
the prime contractor (and any subcontractor performing work on the 
contract under the prime contractor) shall guarantee throughout the 
performance of work under the contract to comply with the workmen's 
compensation law of each State in which work under the contract will be 
performed.
    ``(b) Termination of Work on Failure to Demonstrate Compliance.--
Each such contract shall contain the further provision that in the 
event the contracting officer determines that the prime contractor (or 
any subcontractor under the contract) is not in compliance with the 
workmen's compensation laws of any State within which work under the 
contract is being carried out, the head of the agency concerned may 
terminate the right of the offending contractor or subcontractor to 
proceed with the work or such part of the work being carried out in a 
State in which compliance with the workmen's compensation laws is not 
demonstrated. Notice of such termination shall be provided in writing 
to the offending contractor or subcontractor. If, within a reasonable 
time, the offending contractor or subcontractor has not demonstrated 
compliance with the workmen's compensation laws of such State, 
including payment of any fines or penalties assessed for failure to 
carry workmen's compensation insurance, the head of the agency 
concerned may complete the work. The contractor and any sureties of the 
contractor shall be liable to the Government for any excess costs 
occasioned the Government as a result of the termination.
    ``(c) Exceptions.--This section shall not apply in the case of 
contracts covered by the Defense Base Act (42 U.S.C. 1651 et seq.).
    ``(d) Suspension of Section.--In the event of a national emergency, 
the President may suspend operation of this section.''.
    (2) The table of contents at the beginning of such chapter is 
amended by adding at the end the following new item:

``2332. Compliance with State workmen's compensation laws.''.
    (c) Application of Amendments.--The amendments made by this section 
shall apply with respect to Federal contracts entered into after the 
date of the enactment of this Act.
Amends the Federal Property and Administrative Services Act of 1949 and specified defense procurement provisions to require each contract for the purchase of property or services made by an executive agency to provide:  (1) that the prime contractor and any subcontractor thereof shall guarantee to comply with State workers' compensation laws; and (2) for the termination of the right of the offending contractor or subcontractor to proceed with the work being carried out in a State in which compliance with such a law is not demonstrated, subject to specified requirements. 
Makes specified exceptions to such provisions under the Defense Base Act and the Longshore and Harbor Workers' Compensation Act. 
Authorizes the President to suspend operation of this Act in the event of a national emergency.
To amend the Federal Property and Administrative Services Act of 1949 and title 10, United States Code, to require as a term in each contract for property or services made by an executive agency that the contractor (and any subcontractors under that contract) shall comply with the workmen's compensation law of each State in which the contract is performed.