28368 Federal Register / Vol. 75, No. 97 / Thursday, May 20, 2010 / Rules and Regulations 

1The Department received a single request to 

extend the comment period for an additional 30 

days. The commenter, a law firm, asserted that the 

30-day comment period was too brief and that, as 

a result, many interested parties were unaware of 

the proposed rule. After due consideration, the 

Department has determined that the 30-day 

comment period was sufficient, and additional time 

in which to respond is not warranted. The 

commenter requesting the extension was able to 

submit a lengthy, substantive comment within the 

30-day period and attached additional comments 

from many of its clients. In addition, the 

Department received within the 30-day period a 

notable number of substantive comments 

representing a broad spectrum of interests 

associated with the proposed rule. Finally, no other 

commenter requested such an extension. 

DEPARTMENT OF LABOR 

Office of Labor-Management 

Standards 

29 CFR Part 471 

RIN 1215–AB70; RIN 1245–AA00 

Notification of Employee Rights Under 

Federal Labor Laws 

AGENCY: Office of Labor-Management 

Standards, Department of Labor. 

ACTION: Final rule. 

SUMMARY: On August 3, 2009, the Office 

of Labor-Management Standards 

(‘‘OLMS’’) in the Department of Labor 

(‘‘the Department’’) issued a proposed 

rule implementing Executive Order 

13496. This final rule sets forth the 

Department’s review of and response to 

comments on the proposal and any 

changes made to the rule in response to 

those comments. 

President Barack Obama signed 

Executive Order 13496 (‘‘Executive 

Order’’ or ‘‘E.O. 13496’’) on January 30, 

2009. The Executive Order requires 

nonexempt Federal departments and 

agencies to include within their 

Government contracts specific 

provisions requiring contractors and 

subcontractors with whom they do 

business to post notices informing their 

employees of their rights as employees 

under Federal labor laws. The Executive 

Order requires the Secretary of Labor 

(‘‘Secretary’’) to prescribe the size, form, 

and content of the notice that must be 

posted by a contractor under paragraph 

1 of the contract clause described in 

section 2 of the Order. Under the 

Executive Order, unless a specified 

exception or exemption applies, Federal 

Government contracting departments 

and agencies must include the required 

contract provisions in every 

Government contract. As required by 

the Executive Order, this final rule 

establishes the content of the notice 

required by the Executive Order’s 

contract clause, and implements other 

provisions of the Executive Order, 

including provisions regarding 

sanctions, penalties, and remedies that 

may be imposed if the contractor or 

subcontractor fails to comply with its 

obligations under the Order and the 

implementing regulations. 

DATES: Effective Date: This rule will be 

effective on June 21, 2010. 

FOR FURTHER INFORMATION CONTACT: 

Denise M. Boucher, Director, Office of 

Policy, Reports and Disclosure, Office of 

Labor-Management Standards, U.S. 

Department of Labor, 200 Constitution 

Avenue, NW., Room N–5609, 

Washington, DC 20210, (202) 693–0123 

(this is not a toll-free number), (800) 

877–8339 (TTY/TDD). 

SUPPLEMENTARY INFORMATION: The 

Regulatory Information Number (RIN) 

identified for this rulemaking changed 

with publication of the Spring 

Regulatory Agenda due to an 

organizational restructuring. The old 

RIN was assigned to the Employment 

Standards Administration, which no 

longer exists; a new RIN has been 

assigned to the Office of LaborManagement Standards. 

I. Background on the Rulemaking 

On August 3, 2009, the Department 

issued a Notice of Proposed Rulemaking 

(‘‘NPRM’’ or ‘‘proposed rule’’), 74 FR 

38488, to implement Executive Order 

13496, ‘‘Notification of Employee Rights 

Under Federal Labor Laws,’’ 74 FR 6107, 

Feb. 4, 2009. The Department invited 

written comments on the proposed 

regulations from interested parties, 

including current and potential 

Government contractors, subcontractors, 

and vendors, and current and potential 

employees of such entities; labor 

organizations; public interest groups; 

Federal contracting agencies; and the 

public. In addition, when proposing 

certain provisions of the rule, the 

Department invited public comment 

regarding issues addressed in those 

specific provisions. The public 

comment period closed on September 2, 

2009, and the Department has 

considered all timely comments 

received in response to the proposed 

rule.1

The Department received 86 unique 

and timely comments from a wide 

variety of sources. Commenters 

included individuals, labor 

organizations, and other organizations 

and associations representing the 

interests of employees, employers and 

government contractors and 

subcontractors. The Department 

recognizes and appreciates the value of 

comments, ideas, and suggestions from 

members of the public, labor 

organizations, employers, industry 

associations and other interested 

parties. 

II. The Executive Order 

On January 30, 2009, President Barack 

Obama signed Executive Order 13496, 

entitled ‘‘Notification of Employee 

Rights Under Federal Labor Laws.’’ 74 

FR 6107, Feb. 4, 2009. The purpose of 

the Executive Order is ‘‘to promote 

economy and efficiency in Government 

procurement’’ by ensuring that 

employees of certain Government 

contractors are informed of their rights 

under Federal labor laws. Id., Sec. 1. As 

the Order states, ‘‘When the Federal 

Government contracts for goods or 

services, it has a proprietary interest in 

ensuring that those contracts will be 

performed by contractors whose work 

will not be interrupted by labor unrest. 

The attainment of industrial peace is 

most easily achieved and workers’ 

productivity is enhanced when workers 

are well informed of their rights under 

Federal labor laws, including the 

National Labor Relations Act (Act), 29 

U.S.C. 151 et seq.’’ Id. The Order 

reiterates the declaration of national 

labor policy contained in the National 

Labor Relations Act (‘‘NLRA’’), 29 U.S.C. 

151, that ‘‘encouraging the practice and 

procedure of collective bargaining and 

* * * protecting the exercise by 

workers of full freedom of association, 

self-organization, and designation of 

representatives of their own choosing, 

for the purpose of negotiating the terms 

and conditions of their employment or 

other mutual aid or protection’’ will 

‘‘eliminate the causes of certain 

substantial obstructions to the free flow 

of commerce’’ and ‘‘mitigate and 

eliminate these obstructions when they 

have occurred.’’ Id., Sec. 1, quoting 29 

U.S.C. 151. As the Order concludes, 

‘‘[r]elying on contractors whose 

employees are informed of such rights 

under Federal labor laws facilitates the 

efficient and economical completion of 

the Federal Government’s contracts.’’ Id. 

The Executive Order achieves the goal 

of notification to employees of federal 

contractors of their legal rights through 

two related mechanisms. First, Section 

2 of the Order provides the complete 

text of a contract clause that 

Government contracting departments 

and agencies must include in all 

covered Government contracts. Sec. 2, 

74 FR at 6107–08. Second, through 

incorporation of the specified clause in 

its contracts with the Federal 

government, contractors thereby agree to 

post a notice in conspicuous places in 

their plants and offices informing 

employees of their rights under Federal 


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2For ease of reference and to avoid confusion, the 

Directors of OLMS and of OFCCP are referred to in 

this preamble by their current title, ‘‘Director,’’ even 

when this preamble is discussing passages of the 

NPRM that refer to their former title, ‘‘Deputy 

Assistant Secretary.’’ 

labor laws. Sec. 2, para. 1, 74 FR at 

6107–08. 

The Executive Order states that the 

Secretary ‘‘shall be responsible for [its] 

administration and enforcement.’’ Sec. 

3, 74 FR at 6108. To that end, the 

Executive Order delegates to the 

Secretary the authority to ‘‘adopt such 

rules and regulations and issue such 

orders as are necessary and appropriate 

to achieve the purposes of this order.’’ 

Id., Sec. 3(a). In particular, the 

Executive Order requires the Secretary 

to prescribe the content, size, and form 

of the employee notice. Id., Sec. 3(b). In 

addition, the Executive Order permits 

the Secretary, among other things, to 

make modifications to the contractual 

provisions required to be included in 

Government contracts (Sec. 3(c)); to 

provide exemptions for contracting 

departments or agencies with respect to 

particular contracts or subcontracts or 

classes of contracts or subcontracts for 

certain specified reasons (Sec. 4); to 

establish procedures for investigations 

of Government contractors and 

subcontractors to determine whether the 

required contract provisions have been 

violated (Sec. 5); to conduct hearings 

regarding compliance (Sec. 6); and to 

provide for certain remedies in the 

event that violations are found (Sec. 7). 

74 FR at 6108–09. 

III. Statutory Authority for the 

Executive Order and the Department’s 

Regulation 

A. Legal Authority 

The President issued Executive Order 

13496 pursuant to his authority under 

‘‘the Constitution and laws of the United 

States,’’ expressly including the Federal 

Property and Administrative Services 

Act (‘‘Procurement Act’’), 40 U.S.C. 101 

et seq. The Procurement Act authorizes 

the President to ‘‘prescribe policies and 

directives that [he] considers necessary 

to carry out’’ the statutory purposes of 

ensuring ‘‘economical and efficient’’ 

government procurement and supply. 

40 U.S.C. 101, 121(a). Executive Order 

13496 delegates to the Secretary of 

Labor the authority to ‘‘adopt such rules 

and regulations and issue such orders as 

are necessary and appropriate to achieve 

the purposes of this order.’’ Sec. 3, 74 FR 

at 6108. The Secretary has delegated her 

authority to promulgate these 

regulations to the Office of Federal 

Contract Compliance Programs 

(‘‘OFCCP’’) and the Office of LaborManagement Standards (‘‘OLMS’’). 

Secretary’s Order 7–2009, 74 FR 58834, 

Nov. 13, 2009; Secretary’s Order 8– 

2009, 74 FR 58835, Nov. 13, 2009. 

B. Interagency Coordination 

Section 12 of the Executive Order 

requires the Federal Acquisition 

Regulatory Council (‘‘FAR Council’’) to 

take action to implement provisions of 

the Order in the Federal Acquisition 

Regulation (FAR). 74 FR at 6110. 

Accordingly, the Department has 

coordinated with the FAR Council for 

the insertion of language into the FAR 

that implements the Executive Order. 

IV. Summary of the Final Rule and 

Discussion of the Comments 

This final rule establishes standards 

and procedures for the implementation 

and enforcement of Executive Order 

13496. Subpart A of the rule sets out 

definitions, the prescribed requirements 

for the size, form and content of the 

employee notice, exceptions for certain 

types of contracts, and exemptions that 

may be applicable to contracting 

departments and agencies with respect 

to a particular contract or subcontract or 

class of contracts or subcontracts. 

Subpart B of the rule sets out standards 

and procedures related to complaint 

procedures, compliance evaluations, 

and enforcement of the rule. Subpart C 

sets out other standards and procedures 

related to certain ancillary matters. This 

preamble follows the same 

organizational outline, and within each 

section of the preamble the Department 

has noted and responded to the 

comments addressed to that particular 

section of the rule. 

During the interagency review process 

that preceded the publication of the 

NPRM, the Department received 

requests to improve the readability and 

understandability of the regulatory text 

by employing ‘‘plain language,’’ which 

includes, among other things, the use of 

common, everyday words, except for 

necessary technical terms, the use of the 

active rather than the passive voice, and 

the use of short sentences. The 

Department has made revisions to the 

regulatory text of the final rule in 

accordance with these guidelines. 

As part of a Departmental 

restructuring, effective November 8, 

2009, the Department abolished the 

Employment Standards Administration 

(‘‘ESA’’), which was the administrative 

umbrella for several agencies within the 

Department, including OLMS and 

OFCCP. As the administrator overseeing 

both OLMS and OFCCP, the Assistant 

Secretary for Employment Standards 

had designated administrative and 

enforcement functions under the 

proposed rule. Due to the elimination of 

ESA and the position of Assistant 

Secretary for Employment Standards, 

the final rule has been revised so that 

the roles and functions assigned to the 

Assistant Secretary in the proposed rule 

are reassigned. See §§ 471.2, 471.13, 

471.14, 471.15, 471.16, 471.21, 471.22, 

and 471.23. Generally speaking, the 

Assistant Secretary’s enforcement 

review functions have been reassigned 

to the Department’s Administrative 

Review Board, and the administrative 

functions in the rule have been 

reassigned to the Directors, formerly 

called the Deputy Assistant Secretaries, 

of OFCCP or OLMS, or both.2 In 

addition, the definition of ‘‘Assistant 

Secretary’’ has been deleted from 

§ 471.1, and definitions have been 

added for easy reference to the ‘‘Director 

of OFCCP’’ and the ‘‘Director of OLMS’’ 

in the body of the rule. 

A. The Purpose of Executive Order, 

Statutory Authority and Preemption 

The Department received a number of 

comments about the Executive Order 

and its purpose, the President’s 

authority to issue it, and the asserted 

preemption of the Order or the 

Department’s regulation by the National 

Labor Relations Act (‘‘NLRA’’), 29 U.S.C. 

151, et seq. First, the Department 

received several comments opposing the 

Executive Order generally, each of 

which suggests, for various reasons, that 

the Executive Order constitutes 

unnecessary interference with private 

enterprise. Several commenters also 

commented on the purpose of the 

Executive Order. Some commenters 

were doubtful that the Executive Order 

would fulfill its stated goals of 

promoting economy and efficiency in 

government procurement through 

notifying employees of their rights, and 

suggested instead the Executive Order 

would have the opposite effect and 

actually increase costs to taxpayers and 

amplify labor-management conflict, 

among other negative effects cited. 

Other commenters stated that the 

Executive Order would undoubtedly 

achieve its stated goals. In particular, 

these commenters indicated that 

informing employees of their rights will 

enhance industrial peace and worker 

productivity, promote a stable 

workforce and improve employee 

morale, reduce intimidation, 

misinformation, harassment, and fear in 

the workplace, eliminate injustice, and 

contribute to positive labor-management 

relations—all of which will foster labor 

peace and reduce costs to the 

government. 


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28370 Federal Register / Vol. 75, No. 97 / Thursday, May 20, 2010 / Rules and Regulations 

3Since the passage of the Procurement Act in 

1949, successive administrations have issued 

executive orders governing labor and employment 

practices of federal contractors, and such orders 

have been sustained in the federal courts of appeals 

against attacks asserting that the President exceeded 

his authority under the Procurement Act. See, e.g., 

Executive Order 11246, 3 CFR 339 (1964–65 

Compilation) (1965) (applying equal opportunity 

principles to federal contractors), upheld by 

Contractors Ass’n of Eastern Pennsylvania v. 

Secretary of Labor, 442 F.2d 159 (3d Cir.), cert. 

denied, 404 U.S. 854, (1971); Executive Order 

12092, 43 FR 51,375 (1978) (imposing wage controls 

on federal contractors), upheld by AFL–CIO v. 

Kahn, 618 F.2d 784 (DCCir.) (en banc), cert. denied, 

443 U.S. 915 (1979); Executive Order 13202, 66 FR 

11225 (2001) (agencies and entities receiving 

federal assistance for construction projects may 

neither require nor prohibit bidders or contractors 

from entering into project labor agreements), upheld 

by Bldg. and Constr.. Trades Dept, AFL–CIO v. 

Allbaugh, 295 F.3d 28 (DC Cir. 2002); E.O. 13201, 

66 FR 11221 (2001) (requiring federal contractors to 

include in their contracts a provision agreeing to 

post notices informing employees of Beck rights), 

upheld by UAW-Labor and Employment Training 

Corp. v. Chao, 325 F.3d 360 (DCCir. 2003). See also 

City of Albuquerque v. U.S. Dept. of Interior, 379 

F.3d 901 (10th Cir. 2004) (Procurement Act 

provided a sufficient statutory foundation for 

executive order directing that in meeting federal 

space needs in urban areas, first consideration be 

given to centralized community business areas; 

order’s directions were sufficiently related to the 

Act to be a valid exercise of the Act’s delegated 

authority); AFL–CIO v. Carmen, 669 F.2d 815 (DC 

Cir. 1981) (executive action to phase out free 

parking for federal employees was authorized since 

the institution of parking charges for federal 

employees would assist government in utilizing its 

property efficiently and economically). 

One commenter suggested that the 

Procurement Act provides an 

insufficient basis of authority for the 

President to issue Executive Order 

13496. Although the comment 

acknowledges that the courts have 

rejected a similar challenge alleging 

insufficient authority under the 

Procurement Act for the issuance of an 

executive order requiring federal 

contractors to post notices to their 

employees, the commenter suggests that 

the scope of the notice required by 

Executive Order 13496 is broader than 

the Procurement Act permits. 

The Department disagrees with the 

assertion that Executive Order 13496 is 

not within the President’s authority 

under the Procurement Act. The 

Procurement Act authorizes the 

President to ‘‘prescribe policies and 

directives that the President considers 

necessary to’’ ‘‘provide the Federal 

Government with an economical and 

efficient system’’ of government 

procurement. 40 U.S.C. 101, 121. The 

Procurement Act grants the President 

flexibility and ‘‘broad-ranging 

authority,’’ and executive orders issued 

under the authority of the Procurement 

Act need only meet a ‘‘lenient standard’’ 

that requires that the order have a 

‘‘sufficiently close nexus’’ to the values 

of providing the government an 

economical and efficient system for 

procurement and supply. UAW-Labor 

Employment Training Corp. v. Chao, 

325 F.3d 360, 367–68 (DC Cir. 2003). 

Various executive orders have passed 

this ‘‘lenient standard,’’ even in cases in 

which the link between the order and 

efficient procurement may seem 

attenuated, where an argument can be 

made that the order will have the 

opposite effect of its stated goal, or 

when the order increases costs to the 

government in the short term. Id. at 

367–68.3 Executive Order 13496, which 

is intended to reduce government 

procurement costs through better 

informing employees of their rights so 

that obstructions to commerce stemming 

from labor unrest will be mitigated or 

eliminated, certainly meets this 

standard. 

Five commenters contend that the 

Executive Order or the Department’s 

regulations implementing it are 

preempted by the National Labor 

Relations Act. The comments invoke 

both theories of NLRA preemption 

fashioned by the Supreme Court, socalled Garmon preemption (San Diego 

Bldg. Trades Council v. Garmon, 359 

U.S. 236, 244 (1959)), which prohibits 

regulation of activities that are protected 

by Section 7 or prohibited by Section 8 

of the NRLA, and so-called Machinists 

preemption (Int’l Ass’n of Machinists & 

Aerospace Workers v. Wisconsin 

Employment Relations Comm’n, 427 

U.S. 132, 144 (1976)), which prohibits 

regulation of areas that Congress 

intended to be left ‘‘unregulated and to 

be controlled by the free play of 

economic forces.’’ 427 U.S. at 144. The 

Court has described Machinists preemption as creating a ‘‘free zone from 

which all regulation, ‘whether federal or 

State,’ is excluded.’’ Golden State 

Transit Corp. v. Los Angeles, 493 U.S. 

103, 111 (1989), quoting Machinists, 427 

U.S. at 153. 

The Department disagrees with the 

contention that the Executive Order or 

this implementing regulation is 

preempted by the NLRA. Garmon 

preemption is inapplicable because the 

activity regulated by the Executive 

Order—the posting of an accurate, 

noncoercive notice of employee rights— 

is not conduct that is either protected by 

Section 7 or prohibited by Section 8 of 

the NLRA. Similarly, Machinists 

preemption is inapplicable because the 

provision of accurate, noncoercive 

information to employees about their 

NLRA rights is not within the zone of 

conduct intended by Congress to be 

reserved for market freedom. Further, 

Chamber of Commerce v. Brown, 128 

S.Ct. 2408 (2008), in which the Court 

held that Machinists preemption 

invalidated a State statute that 

prohibited employers that receive State 

funds from assisting, promoting, or 

deterring union organizing, is 

distinguishable because the State law in 

that case attempted regulation of speech 

about unionization that was within the 

zone of conduct intended to be left to 

market forces. In this case, federal 

contractors remain free to advocate 

about unionization, and there is no 

interference with speech rights 

protected by Section 8(c) of the NLRA. 

Further, the regulation does not 

interfere with the primary jurisdiction 

of the National Labor Relations Board 

(‘‘NLRB’’ or ‘‘Board’’) to draw the lines 

defining coercive speech that violates 

Section 8 of the NLRA, 29 U.S.C. 158, 

or that is prejudicial to a fair 

representation election under Section 9, 

29 U.S.C. 159. 

B. The Definitions 

Section 471.1 of the final rule 

contains definitions of terms used in the 

rule. The Department received six 

comments from the public about the 

proposed definitions and, as noted 

below, has made some modifications to 

the definitions after reviewing the 

comments. 

The Department received three related 

to the definitions of ‘‘contractor’’ and 

‘‘contract.’’ The NPRM defined a 

‘‘contractor’’ to include both a prime 

contractor and a subcontractor, and 

defined ‘‘contract’’ to include both a 

Government contract and a subcontract. 

The effect of these definitions, taken 

together with the substantive obligations 

of the Executive Order and the rule, 

creates no differentiation between the 

obligations of the prime contractor—the 

contractor that directly does business 

with the Federal government—and the 

subcontractors of the prime contractor. 

The three comments noted that the 

broad definitions of ‘‘contractor’’ and 

‘‘contract’’ improperly and without 

limitation impose the substantive 

obligations of the rule on all 

subcontractors. The three comments all 

suggest that the definitions should be 

modified to reflect some limitation on 

the application of the rule to 

subcontractors, such as the application 

of the simplified acquisition threshold, 

41 U.S.C. 403, to subcontractors or a 

limitation on the application of the rule 

to subcontractors below the first tier. 

One of the three comments notes that 

although the proposed rule stated that 

the simplified acquisition threshold did 

not apply to subcontracts, because the 

definition of ‘‘contract’’ and 

‘‘contractors’’ included ‘‘subcontract’’ 


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and ‘‘subcontractor,’’ the rule arguably 

applies the simplified acquisition 

threshold to subcontracts. 74 FR at 

38491. 

The remaining comments about the 

definitional section of the rule were all 

submitted by one commenter. This 

commenter noted that the limited 

definition of ‘‘collective bargaining 

agreement’’ in the proposed rule is 

inconsistent with the definition of 

‘‘collective bargaining agreement’’ in the 

NLRA, and may lead to confusion. The 

same commenter requests an 

explanation for the inclusion of 

‘‘weatherization’’ in the definition of 

‘‘construction,’’ noting that the 

definition of ‘‘construction’’ in similar 

Departmental regulations does not 

include the term. Finally, this 

commenter recommends that the 

definition of ‘‘government contract’’ 

should expressly exclude contracts for 

the purchase of ‘‘commercial items,’’ as 

defined in the Federal Acquisition 

Regulation, 48 CFR 2.101, so that the 

terms and conditions of sales of 

commercial items to the government 

will be as similar as possible to sales in 

the private sector where a contract with 

the government is not involved. 

After full consideration of these 

comments about the definitions in the 

proposed rule, the Department has made 

the following decisions. The 

Department endorses the definitions of 

‘‘contract’’ and ‘‘contractor’’ as set out in 

the proposal, and has made no change 

to these definitions in the final rule. As 

discussed in greater detail below, the 

obligations of the final rule apply to 

both the government contractor and its 

subcontractors at any tier. In addition, 

the exception in the Executive Order, 

and in this implementing rule, for 

government contracts below the 

simplified acquisition threshold applies 

only to the prime contract and not to 

subcontracts of the prime contract. 

Finally, as further explained below, the 

Department has decided to except from 

application of the final rule subcontracts 

that are de minimis in value, which the 

Department has defined as those 

subcontracts that do not exceed $10,000. 

This exception has been incorporated 

into the rule in § 471.3(a), and no 

modification to the definitions is 

required in order to implement this new 

exception for de minimis value 

subcontracts. 

The Department declines to exclude 

from the definition of ‘‘government 

contract’’ contracts for commercial items 

as defined in the Federal Acquisition 

Regulations, 48 CFR 2.101. The 

Department acknowledges, as the 

comment suggests, that the application 

of this rule to contracts for commercial 

items means that such contracts will 

differ from the purchase of the same 

items when the Federal government is 

not the purchaser. However, the 

judgment underlying the Executive 

Order, and the Department’s judgment 

in this implementing rule, is that cost 

savings in Federal contracting can be 

made when employees are well 

informed of their NLRA rights, and this 

principle holds true whether the 

contract is for commercial items or for 

some other product or service. 

The Department agrees that the 

definition of ‘‘collective bargaining 

agreement’’ in the rule, which is 

intended only to identify a class of 

collective bargaining agreements under 

the Federal Service Labor Management 

Relations Statute (‘‘FSLMRS’’), 5 U.S.C. 

7101 et seq., that are excepted from 

coverage under the Executive Order, 

may be confusing to readers accustomed 

to the usage of the same term in the 

NLRA. Therefore, the definition of this 

term has been removed from § 471.1, 

and the exception for collective 

bargaining agreements entered into 

under the FSLMRS is set out more fully 

in § 471.3 without cross-reference to the 

definitional section. In order to treat the 

other coverage exception similarly, the 

definition of ‘‘simplified acquisition 

threshold’’ has been removed from 

§ 471.1, and the exception for 

government contracts below the 

simplified acquisition threshold has 

been made more explicit in § 471.3 

without cross-reference to the 

definitional section. In addition, in 

response to a comment, the Department 

notes that because of the Federal 

government’s increased emphasis on 

energy efficiency, the inclusion of 

weatherization activities within the 

definition of ‘‘construction’’ was 

important to ensure that Federal 

contracts involving weatherization are 

subject to the rule. For consistency, a 

similar revision has been made to the 

definition of ‘‘construction work site.’’ 

Finally, in response to a comment 

received during interagency review of 

the final rule, the Department has 

modified the definition of ‘‘labor 

organization’’ to more precisely 

duplicate the definition of ‘‘labor 

organization’’ in the NLRA, 29 U.S.C. 

152(5). 

C. The Content of the Employee Notice 

1. Statutory Rights Included in the 

Notice 

Executive Order 13496 requires the 

Secretary to ‘‘prescribe the size, form 

and content of the notice’’ that 

contractors must post to notify 

employees of their rights. Sec. 3(b), EO 

13496, 74 FR at 6108. Appendix A to 

Subpart A of the proposed regulatory 

text presented the content of the 

Secretary’s proposed notice, which sets 

forth employee rights under the NLRA. 

74 FR at 38498–99. As a threshold 

matter, the Department concluded in the 

NPRM that providing notice of 

employee rights under the NLRA best 

effectuates the purpose of the Executive 

Order. 74 FR at 38489–90. Section 1 of 

the Executive Order clearly states that 

the Order’s policy is to attain industrial 

peace and enhance worker productivity 

through the notification of workers of 

‘‘their rights under Federal labor laws, 

including the National Labor Relations 

Act.’’ Sec. 1, 74 FR at 6107. The policy 

of the Executive Order goes on to 

emphasize the foundation underlying 

the NLRA, which is to encourage 

collective bargaining and to protect 

workers’ rights to freedom of association 

and self-organization, and notes that 

efficiency and economy in government 

contracting is promoted when 

contractors inform their employees of 

‘‘such rights.’’ Further, the contract 

clause prescribed by the Executive 

Order requires Federal contractors to 

post the notice ‘‘in conspicuous places 

in and about plants and offices where 

employees covered by the National 

Labor Relations Act engage in activities 

related to performance of the contract. 

***’’ Sec. 2, para. 1, 74 FR at 6107 

(emphasis added). Because of these 

specific references to the NLRA, the 

NPRM proposed including in the notice 

only employee rights contained in the 

NLRA. 

The Department received one 

comment noting a textual ambiguity in 

the Executive Order relating to the 

content of the notice. The commenter 

pointed out that the Executive Order 

refers to the provision of notice about 

‘‘rights under Federal labor laws, 

including the National Labor Relations 

Act,’’ which, the commenter submits, 

suggests that the Department should 

include rights under other ‘‘Federal 

labor laws’’ in the notice as well. In 

particular, this commenter suggested 

that the notice should include statutory 

rights under the Railway Labor Act 

(‘‘RLA’’), 45 U.S.C. 151–188, the Federal 

law governing labor-management 

relations in the airline and rail 

industries. Two other commenters 

suggested the inclusion in the notice of 

rights under the Labor-Management 

Reporting and Disclosure Act 

(‘‘LMRDA’’) 29 U.S.C. 401 et seq., which 

guarantees certain rights to union 

members. A final commenter on this 

subject agreed with the Department that 


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4The Postal Reorganization Act, 39 U.S.C. 101 et 

seq., extended the jurisdiction of the NLRB to 

employees of the United States Postal Service. See 

39 U.S.C. 1201–1209. 

5Section 7 of the NLRA, 29 U.S.C. 157, states 

that: ‘‘[e]mployees shall have the right to selforganization, to form, join, or assist labor 

organizations, to bargain collectively through 

representatives of their own choosing, and to 

engage in other concerted activities for the purpose 

of collective bargaining or other mutual aid or 

protection, and shall also have the right to refrain 

from any or all such activities except to the extent 

that such right may be affected by an agreement 

requiring membership in a labor organization as a 

condition of employment as authorized in section 

8(a)(3) [section 158(a)(3) of this title].’’ 

6The Department of Labor implements employee 

notification requirements pertaining to employers 

covered by the Fair Labor Standards Act, 29 U.S.C. 

211 (implementing regulation 29 CFR 516.4); the 

Occupational Safety and Health Act, 29 U.S.C. 

657(c) (implementing regulation 29 CFR 1903.2); 

the Family Medical Leave Act, 29 U.S.C. 2601 et 

seq., (implementing regulation 29 CFR 825.300, 

.402); the Uniformed Service Employment and 

Reemployment Rights Act, 38 U.S.C. 4334 

(implementing regulation 20 CFR 1002); Employee 

Polygraph Protection Act, 29 U.S.C. 2003 

(implementing regulation 29 CFR 801.6); and the 

Migrant and Seasonal Agricultural Worker 

Protection Act, 29 U.S.C. 1821(b), 1831(b) 

(implementing regulation 29 CFR 500.75, .76). 

Federal contractors specifically have additional 

notification requirements, including equal 

employment opportunity rights under Executive 

Order 11246, the Rehabilitation Act of 1973, 29 

U.S.C. 793, and the Vietnam Era Veterans’ 

Readjustment Assistance Act of 1974, 

(implementing regulations at 41 CFR Chapter 60– 

l .42; 41 CFR 60–250.4(k); and 41 CFR 60–74 

1.5(a)(4)), and rights under the Davis-Bacon Act, 40 

U.S.C. 3142(c)(2) (implementing regulation 29 CFR 

5.5(a)(l)) and the Service Contract Act, 29 U.S.C. 

351(a)(4) (implementing regulation 29 CFR 4.6(e), 

.184). 

the notice should be limited to rights 

under the NLRA. 

The Department has considered the 

inclusion of other statutory rights in the 

notice, but has concluded that there is 

overwhelming textual support in the 

Executive Order, as noted above, for its 

original conclusion that rights under the 

NLRA should be the sole focal point of 

the required notice. Taken together, 

these provisions of the Executive Order 

offer strong evidence that its intent is to 

provide notice to employees of rights 

under the NLRA. Furthermore, no other 

Federal labor or employment laws are 

mentioned expressly in the Executive 

Order.4 Therefore, there is no textual 

support—other than the plural reference 

to ‘‘Federal labor laws’’—that would 

support the inclusion of rights under 

either the LMRDA or the RLA, as 

suggested by the comments. Inclusion of 

rights under the RLA is precluded for 

another reason as well. Because 

Executive Order 13496 requires that the 

notice be posted ‘‘where employees 

covered by the National Labor Relations 

Act’’ work, 74 FR 6107, and the NLRA 

expressly excludes from its coverage 

employers covered under the RLA and 

their employees, 29 U.S.C. 152(2) and 

(3), when the Executive Order and the 

NLRA are read together, federal 

contractors that are covered by the RLA 

are excluded from the requirements of 

the Executive Order. 

2. Overview of the Comments on the 

Content of the Proposed Notice 

As noted in the NPRM, the 

Department considered the level of 

detail the notice should contain 

regarding NLRA rights. The Department 

considered requiring a verbatim 

replication of the NLRA’s enumeration 

of employee rights in Section 7, 29 

U.S.C. 157, or a simplified list of rights 

based upon that statutory provision.5 In 

the end, however, the Department 

concluded in the NPRM that inclusion 

of the statutory language itself or a 

simplified list of rights in a notice 

would be unlikely to convey the 

information necessary to best inform 

employees of their rights under the Act. 

Instead, the Department proposed a 

statement of employee rights, contained 

in Appendix A to Subpart A of Part 471 

(‘‘NPRM notice’’ or ‘‘proposed notice’’), 

74 FR at 38498–99, that provided greater 

detail of NLRA rights derived from 

Board or court decisions and that would 

more effectively convey such rights to 

employees. The proposed notice also 

contained examples of general 

circumstances that constitute violations 

of employee rights under the Act. Thus, 

the Department proposed a notice that 

provided employees with more than a 

rudimentary overview of their rights 

under the NLRA, in a user-friendly 

format, while simultaneously not 

overwhelming employees with 

information that is unnecessary and 

distracting in the limited format of a 

notice. The Department specifically 

invited comment on the statement of 

employee rights proposed for inclusion 

in the required notice to employees. In 

particular, the Department requested 

comment on whether the notice 

contains sufficient information of 

employee rights under the Act; whether 

the notice effectively conveys the 

information necessary to best inform 

employees of their rights under the Act; 

and whether the notice achieves the 

desired balance between providing an 

overview of employee rights under the 

Act and limiting unnecessary and 

distracting information. 

The content of the proposed notice 

received more comments than any other 

single topic addressed in the proposed 

rule. Many comments from both 

individuals and organizations offered 

general support for the content of the 

proposed notice, stating that employee 

awareness of basic legal rights will 

promote a fair and just workplace, 

improve employee morale, and foster 

workforce stability, among other 

benefits. Several employee and civil 

rights organizations registered support 

for the rule, and maintained that 

because employers are required to post 

notices informing employees of other 

federal workplace rights, this notice 

represents little or no additional burden 

and, in fact, is long overdue given the 

other required notices.6 Labor 

organizations were also supportive of 

the proposed notice generally, noting 

that employees’ awareness of their basic 

workplace rights in a clear and effective 

manner will promote the free exercise of 

those rights and prevent employer 

interference and intimidation of 

employees regarding self-organization 

and collective bargaining. 

Other commenters were less 

enthusiastic about the content of the 

proposed notice. A significant number 

of commenters—approximately onethird—including many employer, 

industry and interest groups, argued 

that the content of the notice is not 

balanced, and appears to promote 

unionization instead of employee 

freedom of association. In particular, 

many commenters stated that among the 

rights contained in Section 7 of the 

NLRA is the right to refrain from union 

activity, but this right is given little 

attention in comparison to other rights 

in the proposed notice. In addition, 

many of these commenters also noted 

that the examples of employer and 

union unfair labor practices are 

unbalanced—the list of employer 

misconduct in the proposed notice was 

seven items long, while the example of 

union misconduct contained only one 

item. Several commenters also noted 

that the proposed notice excludes rights 

associated with an anti-union position, 

including the right to seek 

decertification of a bargaining 

representative, the right to abstain from 

union membership in so-called right-towork states, and rights associated with 

the Supreme Court’s decision in 

Communication Workers v. Beck, 487 

U.S. 735 (1988), permitting employees 

to seek reimbursement of that portion of 

dues or fees collected under a union 

security clause in a collective bargaining 

agreement that is not used for collective 

bargaining, contract administration, or 

grievance adjustments. Many of these 

comments noted that a neutral and 

even-handed government position on 

unionization would be more inclusive 

of these rights. 

Many comments addressed the issue 

of complexity, as it pertains both to the 


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7See http://www.nlrb.gov/Workplace_Rights/ 

employee_rights.aspx. 

8Section 1 of the NLRA states that ‘‘[i]t is 

declared to be the policy of the United States to 

eliminate the causes of certain substantial 

obstructions to the free flow of commerce and to 

mitigate and eliminate these obstructions when 

they have occurred by encouraging the practice and 

procedure of collective bargaining and by protecting 

the exercise by workers of full freedom of 

association, self-organization, and designation of 

representatives of their own choosing, for the 

purpose of negotiating the terms and conditions of 

their employment or other mutual aid or 

protection.’’ 29 U.S.C. 151. 

9Section 1 of the Executive Order, 74 FR 6107, 

states: 

As the [NLRA] recognizes, ‘‘encouraging the 

practice and procedure of collective bargaining and 

* * * protecting the exercise by workers of full 

freedom of association, self organization, and 

designation of representatives of their own 

choosing, for the purpose of negotiating the terms 

and conditions of their employment or other mutual 

aid or protection’’ will ‘‘eliminate the causes of 

certain substantial obstructions to the free flow of 

commerce’’ and ‘‘mitigate and eliminate these 

obstructions when they have occurred.’’ 29 U.S.C. 

151. 

law and to the content of the proposed 

notice. Approximately ten comments 

stated that the Department’s attempt to 

summarize NLRA decisional law was 

flawed because the law is far too 

complex to condense into a single 

workplace notice. Many of these 

comments noted that NLRA law has 

been developed over 75 years, and 

involves interpretations by both the 

NLRB and the federal courts, sometimes 

with conflicting results. Some 

commenters noted that because of Board 

member turnover, which alters the 

political composition of the Board, legal 

precedent changes frequently, thus 

requiring frequent updates to the 

content of the notice. Several 

commenters cited the NLRB’s Basic 

Guide to the National Labor Relations 

Act: General Principles of Law Under 

the Statute and Procedures of the 

National Labor Relations Board (Basic 

Guide to the NLRA) (1997), available at 

http://www.nlrb.gov/nlrb/shared_files/ 

brochures/basicguide.pdf, to make their 

point about legal complexity. In the 

Foreword to the Basic Guide to the 

NLRA, the Board’s General Counsel 

states that ‘‘[a]ny effort to state basic 

principles of law in a simple way is a 

challenging and unenviable task. This is 

especially true about labor law, a 

relatively complex field of law.’’ The 

thrust of these comments about legal 

complexity was that NLRA decisional 

law is too complex, dynamic, and 

nuanced, and any attempt to summarize 

it in a workplace notice will result in an 

oversimplification of the law and lead to 

confusion, misunderstanding, 

inconsistencies, and some say, 

heightened labor-management 

antagonism. 

Similarly, six comments stated that 

the proposed notice itself was too 

complex to be helpful or informative to 

employees. Some said the notice was 

too long and wordy, and therefore likely 

to confuse or mislead employees, 

which, as one commenter noted, is 

contrary to the purpose of the Executive 

Order. Another said the notice is too 

long and contains examples of employer 

misconduct that are arbitrary and too 

specific. 

Comments asserting that the content 

of the proposed notice was too detailed 

dovetailed with the many comments 

suggesting that the required notice 

should specify only those rights 

contained in Section 7 of the NLRA or, 

alternatively, those rights and 

obligations as stated in employee 

advisories on the NLRB’s Web site.7

Approximately sixteen comments 

suggested this simplified approach, 

while only three advocated in favor of 

the level of complexity in the notice, 

noting particularly that the detail in the 

notice comports with the Executive 

Order’s requirement that employees 

should be ‘‘well informed of their 

rights.’’ Those comments favoring a 

more streamlined notice suggested that 

a simplified version of the notice based 

on Section 7 or the NLRB’s Web site 

advisory would be clear, 

straightforward, and easily understood; 

would not be stated in ‘‘legalese’’; would 

be unlikely to confuse or inflame 

tensions; would defer to the statute’s 

drafters or to the NLRB’s expertise to 

provide a statement of rights; would be 

unbiased; and would decrease the 

likelihood of misleading employees; and 

would improve readability. 

In addition to these general comments 

about the proposed notice, many 

comments offered suggestions for 

specific revisions to individual 

provisions within the four sections of 

the proposed notice: the preamble, the 

statement of affirmative rights, the 

examples of unlawful conduct, and the 

enforcement and contact information. 

The following discussion presents in 

succession the comments related to 

individual provisions of the notice, 

followed by the Department’s decisions 

regarding the content of the final notice 

made in response to all comments on 

the content of the notice. 

3. Comments Addressing the Preamble 

of the Proposed Notice 

The preamble of the proposed notice 

stated that ‘‘[i]t is the policy of the 

United States to encourage collective 

bargaining and protect the exercise by 

workers of full freedom of association, 

self-organization, and designation of 

representatives of their own choosing, 

for the purpose of negotiating the terms 

and conditions of their employment or 

other mutual aid and protection.’’ 74 FR 

at 38498. The proposed preamble was 

based on Section 1 of the NLRA, 29 

U.S.C. 151, and Executive Order 13496, 

Section 1. The Department specifically 

sought comment on this description of 

policy in the proposed notice. 

Five commenters support the 

statement in the preamble that U.S. 

policy encourages collective bargaining 

and the full exercise of worker selfdetermination rights. Many supportive 

comments noted that the preamble is 

appropriate given that Section 1 of the 

Executive Order also reiterates the 

policy of encouraging collective 

bargaining. Fourteen commenters 

opposed the preamble on various 

grounds. Many negative commenters 

noted that the preamble resembles text 

from Section 1 of the NLRA, ‘‘Findings 

and Policies,’’ 29 U.S.C. 151, but 

substantially misstates it.8 These 

commenters note that U.S. policy as 

stated in Section 1 of the NLRA is ‘‘to 

eliminate the causes of certain 

substantial obstructions to the free flow 

of commerce and to mitigate and 

eliminate these obstructions when they 

have occurred,’’ and that one means to 

achieve that policy goal is through the 

encouragement of collective bargaining 

and free exercise of rights. By 

overlooking the statute’s true stated 

purpose to eliminate obstructions to 

commerce, these commenters say, the 

notice’s preamble improperly elevates 

the ‘‘encouragement of collective 

bargaining’’ to a guiding principle rather 

than simply a means to achieve the free 

flow of commerce. Other commenters 

noted that the policy of the U.S. is, or 

should be, to remain neutral regarding 

labor-management relations, and the 

preamble should reflect neutrality by 

emphasizing employee choice, which 

includes the right to refrain from 

collective bargaining or other union 

activities. One commenter noted that 

Section 1 of the NLRA must be read 

together with Section 9 of the NLRA, 29 

U.S.C. 159, which establishes 

procedures for the election of a 

collective bargaining representative by a 

vote of a majority, thus underscoring 

that U.S. policy encourages collective 

bargaining only when a majority of 

employees have freely chosen 

workplace representation. Observing 

some differences between the text of the 

notice’s preamble and the statement of 

purpose in the Executive Order, two 

commenters noted that the preamble 

does not accurately track the Executive 

Order’s precatory language.9 Finally, 


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10The brochure can be accessed at http:// 

www.nlrb.gov/nlrb/shared_files/brochures/ 

OutreachBrochure_Rev_10-30-07.pdf. 

several commenters suggested that the 

preamble be eliminated altogether so 

that these drafting issues need not be 

addressed. 

4. Comments Addressing the Statement 

of Affirmative Rights in the Proposed 

Notice 

The proposed notice contains the 

following statement of affirmative rights: 

Under federal law, you have the right to: 

Organize a union to negotiate with your 

employer concerning your wages, hours, and 

other terms and conditions of employment. 

Form, join or assist a union. 

Bargain collectively through a duly 

selected union for a contract with your 

employer setting your wages, benefits, hours, 

and other working conditions. 

Discuss your terms and conditions of 

employment with your co-workers or a 

union; join other workers in raising work 

related complaints with your employer, 

government agencies, or members of the 

public; and seek and receive help from a 

union subject to certain limitations. 

Take action with one or more co-workers 

to improve your working conditions, 

including attending rallies on non-work time, 

and leafleting on non-work time in non-work 

areas. 

Strike and picket, unless your union has 

agreed to a no-strike clause and subject to 

certain other limitations. In some 

circumstances, your employer may 

permanently replace strikers. 

Choose not to do any of these activities, 

including joining or remaining a member of 

a union. 

Comments on the statement of 

affirmative rights offered both general 

guidance on the provisions overall, as 

well as specific recommendations for 

revising each provision individually. 

Generally, two labor organizations 

suggested that the statement of 

affirmative rights should present only 

the basic rights without any attempt to 

present the limitations to those basic 

rights that have developed over the 

decades of decisional law. The first 

labor organization argues that such 

limitations are themselves subject to 

further exceptions, which cannot be 

included in the notice without 

overwhelming and confusing 

employees. This comment notes that the 

limitations to the basic rights included 

on the notice involve fact-dependent 

scenarios that do not assist employees 

in understanding their basic rights. 

None of the basic rights, the comment 

asserts, have ever been understood as 

absolutes without any exceptions or 

limitations, so the attempt to include 

those in the notice is unnecessary and 

confusing. One commenter from the 

retail industry noted generally that the 

statement of affirmative rights should 

contain a disclaimer that ‘‘certain types 

of speech and expression in the 

workplace are not protected.’’ As an 

example, the commenter indicated that 

some employers may permissibly 

prohibit third-party solicitations or 

leafleting, or wearing of any insignia, in 

a retail setting. The final general 

comment regarding the statement of 

affirmative rights suggested that the use 

of the second-person pronouns ‘‘you’’ 

and ‘‘your’’ is overly inclusive because 

not all casual readers of the poster are 

covered by the statement of rights. This 

comment suggests that the notice must 

make it clear that the enumerated rights 

apply only to covered employees, as the 

Department has done with the notice 

required by the Family and Medical 

Leave Act, 29 CFR part 825 Appendix 

C. This comment notes that a statement 

regarding eligibility would eliminate 

confusion for employees who are not 

covered by the NLRA but may read the 

notice. 

Many comments about the notice’s 

statement of affirmative rights were 

directed at whether each individual 

provision, e.g., the right to bargain 

collectively or the right to discuss union 

issues with coworkers, constitutes an 

informative, accurate, and/or complete 

statement of the law. Some general 

conclusions emerge from a review of the 

comments on each provision, which is 

set out in more detail below. First, labor 

organizations tended to favor statements 

of rights that were short and without 

qualifications or exceptions, and 

disfavored the ‘‘subject to certain 

exceptions’’ limitations added to some 

of the provisions. Groups representing 

employers, on the other hand, argued in 

favor of adding exceptions and 

limitations to the notice, sometimes to 

the extent that the notice would lose the 

quality of a poster and would become 

instead a more comprehensive manual. 

a. The Right To Organize and the Right 

To Form, Join and Assist a Union 

There were no comments, positive or 

negative, specifically about the text of 

the notice referencing employees’ rights 

to organize a union or form, join or 

assist a union. 

b. The Right To Bargain Collectively 

Two comments suggested that the 

statement that employees have the right 

to bargain collectively with their 

employers through a duly selected 

union over wages and other terms and 

conditions of employment is misleading 

and vague. The first comment argues 

that the statement is misleading because 

it fails to acknowledge that an employer 

does not have an obligation under the 

NLRA to consent to the establishment of 

a collective bargaining agreement, but 

instead only has the statutory duty to 

‘‘meet at reasonable times and confer in 

good faith with respect to wages, hours, 

and other terms and conditions of 

employment.’’ 29 U.S.C. 158(d). 

Moreover, the failure to reach an 

agreement is not per se unlawful, and 

the finding of an unfair labor practice 

instead depends on whether the parties 

engaged in good faith bargaining. This 

commenter suggests that the notice 

should instead note that the NLRA 

requires the parties to bargain in good 

faith but does not compel agreement or 

the making of concessions, and that, in 

some instances, a bargaining impasse 

will result, permitting the parties to 

exercise their economic weapons, such 

as strikes or lockouts. A few other 

commenters similarly suggested that the 

notice should include a statement that 

both employers and unions have an 

obligation to bargain in good faith. 

The second comment submitted about 

this particular provision argues that the 

term ‘‘duly selected’’ union is so vague 

that it permits misunderstanding. For 

instance, the comment suggests, the 

phrase permits the reader to erroneously 

conclude that an employer is obligated 

to bargain with a union supported by 

the majority of employees signing union 

authorization cards but not certified by 

the NLRB following a governmentsupervised secret ballot election. 

Alternatively, the comment submits that 

the phrase permits readers to 

erroneously believe that an employer 

must bargain with a minority union. To 

remedy the misstatements in this and 

other sections of the notice, the 

comment suggests that the Department 

rely on the text of the NLRB’s very brief 

brochure entitled, Protecting Workplace 

Democracy.10

c. Discuss With Coworkers, Join With 

Other Coworkers 

Both labor organizations and 

management groups suggested changes 

to the third provision in this section of 

the notice. One labor organization 

suggested significant streamlining of 

this provision so that it references only 

employees’ ‘‘communication’’ rights, and 

recommends the inclusion of the other 

‘‘action’’ rights (‘‘join other workers,’’ 

etc.) in the following provision. This 

comment advised that separation of 

communication from action would 

clarify each provision. Thus, the 

comment suggests that this provision 

should read simply: ‘‘Discuss your terms 

and conditions of employment or union 

organizing with your coworkers or with 

a union.’’ A second labor organization 


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11See The Register Guard, 351NLRB 1110 (2007). 

agreed that communication and action 

rights should be separated, but adds that 

this provision should emphasize 

employees’ rights to communicate with 

their coworkers at their place of work 

about union issues. While this comment 

suggests that this provision reference 

‘‘employee’s rights of workplace access/ 

communication,’’ it makes no specific 

proposal for revision of the text. 

Comments from the groups 

representing employer interests 

generally suggest one of two 

approaches—either that the provisions 

should be stricken entirely because the 

law in this area is too complex to 

summarize or that the general statement 

in the provision is inaccurate because it 

fails to include limitations and 

qualifications on an employee’s right to 

discuss union issues with coworkers. 

One law firm representing employers 

suggests that the provision be stricken 

entirely, because the notice cannot 

possibly accurately summarize Board 

law on this point, which is constantly 

evolving. Four other commenters assert 

that the following complexities or 

subtleties are missed in the overly 

succinct statement about 

communication rights: The statement 

fails to notify employees that employers 

can lawfully prohibit certain 

communication, such as a no-talk rule 

about a drug investigation or 

disparagement of employer’s product or 

service; the statement fails to include 

the Board’s recently articulated rules 

governing employee use of and access to 

employer e-mail for union talk,11 omits 

references to the fact that an employee 

does not have an absolute right to speak 

to a union organizer on an employers’ 

property, does not discuss the meaning 

of ‘‘mutual aid,’’ fails to discuss an 

employees’ duty not to disparage 

employers’ products or services, and 

does not reference the limitations on socalled Weingarten rights involving an 

employee’s right to have a union 

representative present in a disciplinary 

meeting; and the provision does not 

clarify that concerted activity must be 

both ‘‘concerted’’ and ‘‘for the mutual aid 

and protection’’ of employees, nor does 

it reflect that not all action taken 

together with coworkers is protected, for 

example, a sit down strike; and the 

provision does not explain that certain 

expressions or conduct, for instance, 

profanity directed at the employer, may 

not be protected (Jackson Lewis). As 

proposed revisions to this provision, 

one comment suggests that provisions 

should include the general ‘‘subject to 

certain limitations’’ language; another 

suggests sole reliance on the NLRB’s 

brochure, Protecting Workplace 

Democracy, See supra n. 12; and the 

remaining comments suggest the 

inclusion of the level of detail that 

would effectively turn the notice into a 

multi-page legal reference. 

d. Attending Rallies 

All four comments about the right to 

attend rallies suggest that this provision 

should be eliminated. One comment 

suggests that the term ‘‘rally’’ has no 

legal history or meaning under the 

NLRA, and that the reference is 

misleading because it erroneously 

indicates that there might be some legal 

protection for a rally on company 

property on non-work time. Other 

comments similarly suggest that the 

provision is flawed because it does not 

distinguish between types of protected 

and unprotected rallies and is 

confusing. In addition to deleting the 

reference to rallies, one labor 

organization’s proposed revision 

suggests deleting the reference to 

leafleting, discussed further below, and 

establishing this provision as the 

‘‘action’’ provision in counterpoint to the 

‘‘communication’’ provision above. 

Thus, this comment suggests the 

following revision: ‘‘Take action with 

one or more of your co-workers to 

improve your working conditions by, 

among other means, raising workrelated complaints directly with your 

employer or with a government agency, 

and seeking help from a union.’’ 

e. Leafleting 

Four of the five comments about the 

inclusion of the right to leaflet on nonwork time in non-work areas level 

criticisms similar to criticisms of other 

provisions—that the provision is too 

general and does not distinguish 

between types of leafleting conduct that 

are protected and those that are 

unprotected. For instance, the 

comments indicate that the provision 

fails to note limitations related to the 

rights of off-duty employees to handbill, 

that leafleting can be prohibited in 

patient care areas, and that some types 

of communications, such as the 

disparagement or vilification of an 

employer’s reputation, are unprotected. 

The fifth comment on this topic suggests 

elimination of the provision because the 

right to engage in literature distribution 

is adequately addressed in the examples 

of violations and need not be addressed 

in the statement of affirmative rights. 

f. Striking and Picketing 

The notice’s reference to the right to 

strike and picket received eight 

comments, and the comments are 

aligned generally as they have been with 

other provisions: Labor organizations 

suggest the removal of the ‘‘subject to 

certain other limitations’’ language and 

the suggestion that ‘‘[i]n some 

circumstances, your employer may 

permanently replace strikers,’’ while 

comments representing employer 

interests suggest the provision is flawed 

because of the absence of further 

limitations, exceptions, and 

distinctions. 

One labor organization suggests that 

the right to strike and picket be 

presented as are the other rights in the 

notice, with a plain affirmative 

statement of the right and without 

describing possible limitation on the 

exercise of the right in question. The 

reference to the limitation on the right 

in the presence of a contractual nostrike clause both overstates and 

understates the possible limitations on 

the right, this commenter submits, 

depending, for example, on the nature 

of the no-strike clause in question. A 

second labor organization echoes the 

criticism, and further suggests that the 

introduction of the complex law 

regarding an employer’s right to 

permanently replace certain striking 

employees adds an unnecessary and 

ultimately confusing limitation, which 

will lead employees to fear exercising 

the right. Other labor organizations 

specifically endorse this criticism. 

Among the permutations missed in 

the proposed formulation, other 

commenters argue, are the distinctions 

that may lead to a determination that 

certain strike activity is unprotected, 

such as whether the strike is for 

recognition or bargaining, whether the 

strike has a secondary purpose, whether 

picketing involves a reserved-gate, 

whether the strike is a sit-down or 

minority strike, whether the conduct is 

a slow down and not a full withholding 

of work, whether the strike is partial or 

intermittent, whether the strike involves 

violence, and whether the strike is an 

unfair labor practice strike or an 

economic strike. One law firm suggests 

this area of law is so complex that it 

cannot be reduced to a single provision 

in the notice, and thus should be 

eliminated altogether. 

g. Choosing To Refrain From Union 

Activity 

All nine comments about the right to 

refrain from engaging in union activity 

universally criticized its lack of 

prominence, two of these comments 

asserting that the provision’s 

prominence was so diminished that 

they did not notice the statement at all. 

Some comments accused the 

Department of ‘‘burying’’ the provision 

in the text far below the other rights to 


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engage in union activity, further 

exemplifying, some say, that the 

Department favors union activity. 

Suggested revisions to amplify the 

prominence of the provision include 

stating that employees have the right to 

refrain from protected, concerted 

activities and/or union activities; stating 

that employees’ right to refrain includes 

the right to actively oppose 

unionization, to not sign union 

authorization cards, to request a secret 

ballot election, to decertify a union 

representative, to not be a member of a 

union or pay dues or fees (addressed 

further below); and stating that 

employees have the right to be fairly 

represented even if not a member of the 

union. One employer suggested that if 

the notice retains its current emphasis 

favoring union activity and disfavoring 

the freedom to refrain from such 

activity, employers will be compelled to 

post their own notices, which the 

commenter states is not unlawful, that 

emphasize and elaborate on the right to 

refrain. Rather than subject employees 

to two posters, the commenter suggests, 

the Department should better balance 

this notice. 

h. Rights Related to Union Membership 

Eight commenters want the notice to 

include a statement about an employee’s 

rights under Communication Workers v. 

Beck, 487 U.S. 735 (1988) (‘‘Beck 

rights’’). Typical of these comments is a 

submission suggesting that the notice 

should include the right to not be a 

member of a union, to not pay union 

dues or fees as condition of employment 

if the employee is in a so-called rightto-work state, and not to pay full union 

dues as condition of employment in 

non-right-to-work state. This commenter 

suggests that the failure to include these 

rights would make clear the Secretary’s 

purpose to assist unions and union 

officials that themselves enjoy no rights 

under the NLRA. Another commenter 

made a somewhat different point about 

Beck rights, suggesting that the notice 

must include the right to refrain from 

being a full dues-paying member 

although an employee may have to pay 

representational fees; the right to refuse 

to pay any dues in a right-to-work state; 

and the right to withhold dues 

earmarked for political, lobbying or 

other non-representational activities. A 

third commenter suggests that if Beck 

rights are included, the Department may 

find it difficult to explain ‘‘compulsory 

unionism.’’ 

5. The Examples of Unlawful Conduct 

in the Notice 

The proposed Notice contained the 

following examples of unlawful 

conduct: 

It is illegal for your employer to: 

Prohibit you from soliciting for the union 

during non-work time or distributing union 

literature during non-work time, in non-work 

areas. 

Question you about your union support or 

activities. 

Fire, demote, or transfer you, or reduce 

your hours or change your shift, or otherwise 

take adverse action against you, or threaten 

to take any of these actions, because you join 

or support a union, or because you engage in 

other activity for mutual aid and protection, 

or because you choose not to engage in any 

such activity. 

Threaten to close your workplace if 

workers choose a union to represent them. 

Promise or grant promotions, pay raises, or 

other benefits to discourage or encourage 

union support. 

Prohibit you from wearing union hats, 

buttons, t-shirts, and pins in the workplace 

except under special circumstances, for 

example, as where doing so might interfere 

with patient care. 

Spy on or videotape peaceful union 

activities and gatherings or pretend to do so. 

It is illegal for a union or for the union that 

represents you in bargaining with your 

employer to: Discriminate or take other 

adverse action against you based on whether 

you have joined or support the union. 

As a general matter and as noted earlier, 

there were many comments about the 

disproportionate number of examples of 

employer misconduct as compared to 

the single example of union 

misconduct. Thirteen comments made 

this point, many relying on the number 

of paragraphs devoted to illegal 

employer conduct (7) and the number of 

paragraphs devoted to illegal union 

conduct (1). Several comments 

indicated that when one compares the 

employer misconduct listed in Section 

8(a) of the NLRA with union 

misconduct listed in Section 8(b), no 

such imbalance appears in the text of 

the statute. In order to comply with the 

Executive Order’s directive to accurately 

inform workers of their rights, several 

comments indicated, additional 

examples of illegal union conduct must 

be included. Many suggested reliance 

on the statutory text of Section 8 to 

achieve the proper balance. Several 

commenters provided additional 

examples of union misconduct that may 

be listed, including the refusal to 

process a grievance because the 

employee is not a union member, 

requiring nonmembers to pay a fee to 

receive contract benefits, videotaping 

non-striking employees, disciplining 

members for engaging in activity 

adverse to a union-represented grievant, 

disciplining members for refusing to 

engage in unprotected activity, engaging 

in perfunctory or careless grievance 

handling, failing to notify employees of 

their Beck rights, causing or attempting 

to cause an employer to discriminate 

against an employee regarding union 

security, requiring employees to agree to 

dues checkoff instead of direct payment, 

discriminatorily applying hiring hall 

rules, and conditioning continued 

employment on the payment of a fine. 

Four commenters offered general 

comments about the examples of 

unlawful employer conduct. Of those, 

two suggested relatively minor 

revisions—one asked for more specific 

examples of violations and one 

suggested the inclusion of the concept 

that low-level supervisors must not 

engage in misconduct. A third suggested 

the inclusion of examples of employer 

misconduct that interferes with or 

restrains an employee’s right to oppose 

unionization. The fourth, from a labor 

organization, suggests that the 

Department should delete the specific 

references to solicitation, distribution 

and insignia, and instead categorically 

state that ‘‘it is unlawful for employers 

to interfere with any and all employee 

rights, including all examples of rights 

listed above.’’ This comment contends 

that this would be clearer and more 

accurate than the current provision, 

which lists only some but not all 

violations. 

As with the notice’s statement of 

affirmative rights, the individual 

provisions in this section of the notice 

each received numerous comments and 

suggestions for improvement. The vast 

majority of the comments about the 

specific provisions are from 

representatives of employers, and most 

suggest that the examples are too broad 

and fail to reflect the various 

permutations that would convert some 

conduct from prohibited to permitted. 

a. No Solicitation and No Distribution 

Rules 

Seven commenters were critical of the 

provision stating that an employer 

cannot lawfully prohibit employees 

from ‘‘soliciting for the union during 

non-work time or distributing union 

literature during non-work time, in nonwork areas.’’ Of those, two labor 

organizations suggest that the references 

to ‘‘non-work time’’ and ‘‘non-work 

areas’’ are too abstract, ambiguous and 

confusing, and suggest additions to the 

text to explain the references. Thus, one 

labor organization proposes that the 

notice state that employers may not 

‘‘prohibit you from soliciting for a union 

during non-work time, such as before or 


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12This comment also suggested changing the 

reference in the proposed provision from ‘‘the 

union’’ to ‘‘a union’’ to avoid the suggestion that 

there is a preferred union, such as an incumbent 

union. This suggestion has been adopted. 

after work or during break times; or 

from distributing union literature during 

such non-work time, in non-work areas, 

such as parking lots or break rooms.’’ 12

The second labor organization offered 

the same clarification of the reference to 

non-work time, but goes further. This 

comment suggested that ‘‘solicitation’’ 

has a narrow meaning and involves 

asking someone to join the union by 

signing an authorization card, which is 

subject to the restrictions suggested in 

the notice. The comment submits, 

however, that this should be 

distinguished from more general ‘‘union 

talk’’—discussing the advantages and 

disadvantages of unionization—which, 

the comment asserts, cannot be lawfully 

restricted by employers. 

The remaining comments criticize the 

provision for failing to note any 

limitations on employees’ rights to 

solicit and distribute, such as the 

limited rights of off-duty employees, 

and limitations in the retail and health 

care establishments. One comment, in 

particular, wants the notice to advise 

hospital employees that they do not 

enjoy a protected right to solicit in 

immediate patient care areas or where 

their activity might disturb patients, and 

proposes including the qualification, 

‘‘except that a hospital or other health 

care employer may prohibit all 

solicitation in immediate patient care 

areas or outside those areas when 

necessary to avoid disrupting health 

care operations or disturbing patients.’’ 

Another comment suggested that the 

law in this area is so complex that no 

meaningful but succinct provision can 

be constructed, and therefore 

recommends deleting it entirely. 

b. Interrogating Employees About Union 

Activity 

Four commenters, all representing 

employer interests, suggested that the 

notice’s provision indicating that it is 

unlawful for an employer to question an 

employee about his or her union 

support or activities is too broadly 

stated. Three of the four suggested that 

the provision should include the 

Board’s standard for analysis of 

interrogation charges, i.e., whether the 

questioning interferes with an 

employee’s rights given the totality of 

the circumstances. Two of those three 

suggested the inclusion of the 

circumstances that might be considered 

to determine whether questioning is 

unlawful, including the presence of 

employer hostility to unions, the 

identity of the questioner, the place and 

method used, and the employee’s 

response. The fourth comment asserted 

that the provision should be stricken 

because the law in this area is too 

complex to summarize. 

c. Taking Adverse Action Against 

Employees for Engaging in UnionRelated Activity 

Four comments, all from employer 

groups, disapprove of the provision 

describing unlawful employer 

discrimination against employees for 

engaging in union activity. Two of the 

four suggest that the provision is 

inadequate because it does not 

recognize the application of the Board’s 

burden-shifting analysis in Wright Line, 

Inc., 251 NLRB 1083 (1980) to 

determine whether unlawful 

discrimination has occurred. Another 

comment suggests that the provision is 

inaccurate because it does not reflect 

that in states without right-to-work laws 

and where a collective bargaining 

agreement contains a union security 

clause, some employers may be required 

to terminate employees who choose not 

to join the union or pay union dues or 

fees. The final comment complains that 

this provision is inaccurate because it 

does not include or explain protection 

for ‘‘concerted activity.’’ 

d. Threats To Close 

Five comments, all from employer 

groups, criticize the overgeneralization 

of the provision stating that it is 

unlawful to threaten to close if a union 

is chosen to represent employees. Most 

comments note that, as with unlawful 

interrogation, a threat to close is 

evaluated under a totality of 

circumstances, and that an employer is 

permitted to state the effects of 

unionization on the company so long as 

the statement is based on demonstrably 

probable consequences of unionization. 

Also, as with other provisions, one 

commenter suggested that the provision 

should be eliminated because the law in 

this area is too complex to capture. A 

final comment suggests that the 

provision implies that a union can 

guarantee job security. 

e. Promising Benefits 

One comment from a group 

representing employer interests states 

that this provision is ‘‘the only 

substantive statement that the 

Department has proposed in the notice 

that we do not find fault with.’’ The only 

two other comments state that the 

provision fails to recognize that an 

employer may promise or grant benefits 

that are not coercive in nature. 

f. Prohibitions on Union Insignia 

Two labor organizations and six 

employer groups are critical of this 

provision. One labor organization 

criticizes both the inclusion of the 

‘‘special circumstances’’ exception as 

well as the reference to ‘‘patient care 

areas’’ as an example of a special 

circumstance. In addition to asserting 

that it inaccurately states the law 

because it fails to include ‘‘immediate’’ 

as a characterization of ‘‘patient care 

areas,’’ this comment suggests that the 

provision would be better stated as an 

affirmative right rather than an 

employer unfair labor practice. The 

second labor organization suggests the 

elimination of ‘‘patient care area’’ as an 

example of the ‘‘special circumstances’’ 

exception. 

The six remaining comments suggest 

that the provision fails to illuminate the 

conditions under which ‘‘special 

circumstances’’ may exist, including in 

hotels or retail establishments where the 

insignia may interfere with the 

employer’s public image, or when the 

insignia is profane or vulgar. Another 

comment indicates that the provision is 

overly broad because it does not reflect 

that a violation depends on the work 

environment and the content of the 

insignia. All either suggest that more 

detail should be added to the provision 

to narrow its meaning, or it should be 

stricken. 

g. Spying or Videotaping 

Five commenters challenged the 

accuracy of this provision, asserting 

primarily that observation of union 

activity that occurs out in the open and 

videotaping for security purposes is 

lawful. Aside from the common 

suggestion that the provision be 

stricken, no specific revisions were 

suggested in the comments. 

h. Union Discrimination or Adverse 

Action 

There were no comments specifically 

addressing the one example of unlawful 

union conduct. 

6. The Enforcement and Contact 

Information in the Notice 

The proposed notice included NLRB 

contact information and basic 

enforcement procedures to enable 

employees to find out more about their 

rights under the Act and to proceed 

with enforcement if necessary. 

Accordingly, the required notice stated 

that illegal conduct will not be 

permitted, provided information 

regarding the NLRB and filing a charge 

with that agency, and indicated that the 

Board will prosecute violators of the 

Act. Furthermore, the notice indicated 


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that there is a 6-month statute of 

limitations applicable to making 

allegations of violations and provides 

NLRB contact information for use by 

employees. The Department invited 

suggested additions or deletions to these 

procedural provisions that would 

improve the content of the notice. 

Three commenters offered suggestions 

for this section of the notice. One 

commenter provided the following text 

to substitute for the paragraph in the 

proposed notice that begins, ‘‘If you 

believe your rights * * *’’: 

If you believe your rights or the rights of 

others have been violated, you should 

contact the NLRB immediately. You may 

inquire concerning possible violations 

without your employer or anyone else being 

informed of the inquiry. If the NLRB 

representative with whom you speak believes 

that a violation might have occurred he or 

she will inform you how you may file a 

charge seeking redress of the violation. 

Charges may be filed by any person and need 

not be filed by the employee directly affected 

by the violation. 

The same commenter also suggested 

that the NLRB’s telephone number 

appear before its Web site information 

because, the comment asserts, more 

people are likely to use the telephone to 

make the contact. A second commenter 

suggested that the contact information 

provide the important assurance that 

employees may raise employment 

questions or concerns with the NLRB in 

confidence, which is a revision that the 

first commenter’s proposed paragraph 

incorporates. Finally, a third commenter 

suggested that the admonition in the 

notice that an employee ‘‘must contact 

the NLRB within six months of the 

unlawful treatment’’ if the employee 

believes a violation has occurred 

suggests that contacting the NLRB is 

mandatory and ignores those employees 

who may not want to contact the NLRB. 

The commenter suggests that the 

provision include the phrase, ‘‘if you 

desire relief from the NLRB.’’ 

7. Suggestions To Incorporate Three 

Additional Provisions 

One comment suggested that the use 

in the proposed notice of the secondperson pronouns ‘‘you’’ and ‘‘your’’ is 

overly inclusive because not all casual 

readers of the poster will be covered by 

the NLRA. This comment suggested that 

the notice should clarify that the 

specified rights apply only to covered 

employees in order to eliminate 

confusion for employees who are not 

covered by the NLRA but may read the 

Notice. 

Four commenters suggested that the 

Notice include a provision referencing 

the NLRA’s obligation on employers and 

labor organizations to bargain in good 

faith. One of these comments requested 

the inclusion as an express limitation on 

the provision that employees have the 

right to bargain collectively, in order to 

clarify that the employer’s obligation 

was only to bargain in good faith and 

not necessarily to reach an agreement. 

One commenter from the retail 

industry noted generally that the 

statement of affirmative rights should 

contain a qualification that ‘‘certain 

types of speech and expression in the 

workplace are not protected.’’ As an 

example, the commenter indicated that 

some employers may permissibly 

prohibit third-party solicitations or 

leafleting, or wearing of any insignia, in 

a retail setting. Although this comment 

suggests a statement indicating 

limitations on certain employee speech 

rights, the Department has considered 

whether such a statement may be 

appropriate more broadly for 

application to all the rights and 

obligations listed in the notice, 

particularly in light of the many 

comments criticizing the proposed 

notice because its provisions do not 

indicate that the rights and obligations 

are subject to exceptions and 

limitations. 

8. Revisions to the Notice Based on the 

Comments 

After fully considering these 

comments, the Department has decided 

to revise the employee notice that will 

be included in the final rule (‘‘final 

notice’’) as follows. 

a. The Introduction to the Final Notice 

The Department has substantially 

revised the preamble, or introduction, to 

the final notice to achieve several goals. 

First, the Department agrees with those 

comments suggesting that the preamble 

included in the NPRM notice contained 

content that did not promote employees’ 

awareness of their specific rights under 

the NLRA, and that such a prominent 

place on the notice merited text that 

better served that goal. Second, the 

Department has included in this 

premier paragraph the concept that the 

NLRA prohibits both employer and 

union misconduct. Third, the 

Department agrees with comments 

suggesting that the final notice should 

contain a provision indicating which 

employers and employees are covered 

by the NLRA, and that coverage 

provision has been added with an 

asterisk in the new introduction. Fourth, 

in response to the many comments 

indicating that the NPRM notice 

included only broad generalities and 

did not include exceptions or 

limitations to the general rights listed in 

the notice based on particular facts or 

circumstances, which, if heeded, would 

convert a simple employee notice into a 

lengthy legal guide, the Department has 

included a cautionary note at the outset 

that the stated rights are general in 

nature, and the notice is not intended to 

provide specific advice about their 

application in all circumstances. 

Finally, the Department has made 

prominent the NLRB investigation and 

enforcement role, and has suggested that 

that agency can assist employees with 

specific questions or concerns should 

they arise. As a result, the final notice 

contains a new introduction that better 

serves these goals, as follows 

The NLRA guarantees the right of 

employees to organize and bargain 

collectively with their employers, and to 

engage in other protected concerted activity. 

Employees covered by the NLRA* are 

protected from certain types of employer and 

union misconduct. This Notice gives you 

general information about your rights, and 

about the obligations of employers and 

unions under the NLRA. Contact the National 

Labor Relations Board, the federal agency 

that investigates and resolves complaints 

under the NLRA, using the contact 

information supplied below if you have any 

questions about specific rights that may 

apply in your particular workplace. 

The coverage provision, associated 

with the asterisk in the introduction, 

states: 

The National Labor Relations Act covers 

most private-sector employers. Excluded 

from coverage under the NLRA are publicsector employees, agricultural and domestic 

workers, independent contractors, workers 

employed by a parent or spouse, employees 

of air and rail carriers covered by the Railway 

Labor Act, and supervisors (although 

supervisors that have been discriminated 

against for refusing to violate the NLRA may 

be covered). 

b. The Statement of Affirmative Rights 

in the Final Notice 

The Department concluded that no 

change was necessary to three of the 

seven affirmative rights listed in the 

proposed notice. As previously noted, 

the first two rights listed—the right to 

organize a union to bargain collectively 

and the right to form, join and assist a 

union—attracted no specific comments, 

either positive or negative, and therefore 

these provisions are unmodified in the 

final notice. The third right that the 

Department has left unchanged—the 

right to refrain from union activity, 

including joining or remaining a 

member of a union—received several 

comments suggesting that this right was 

given diminished prominence in favor 

of rights that promote activity in 

support of unions. This contention is 

misguided. The list of rights included in 


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the notice is patterned after the list of 

rights in the NLRA, 29 U.S.C. 157, 

which includes the right to refrain last, 

after stating several other rights before 

it. See, supra, n. 5. Similarly, the 

NLRB’s Web site page follows the same 

pattern, listing the right to refrain fifth 

on a list of five specified rights. See 

http://www.nlrb.gov/Workplace_Rights/ 

employee_rights.aspx 

In addition, the notice’s examples of 

unlawful employer conduct include the 

concept that it is illegal for an employer 

taking adverse action against an 

employee ‘‘ because [the employee] 

choose[s] not to engage in any such 

[union-related] activity[,]’’ further 

underscoring an employee’s right to 

refrain. Accordingly, the Department 

concludes that the notice sufficiently 

addresses this right among the list of 

statutory rights. 

The Department has amended the 

statement in the notice regarding the 

right to bargain collectively. Based on 

comments discussed above, this 

provision was modified to substitute the 

statutory phrase ‘‘representatives of 

[employees’] own choosing’’ for the 

phrase ‘‘duly selected union’’ to 

eliminate the ambiguity of the latter. 

The substituted phrase retains the intent 

of the original phrase, which was to 

reflect that bargaining representatives 

can be elected or can be voluntarily 

recognized by an employer based on a 

verifiable showing that the labor 

organization enjoys majority support 

among employees in the bargaining 

unit, but employs the words of the 

statute instead. Thus, the final notice 

states that employees have the right to 

‘‘bargain collectively through 

representatives of employees’ own 

choosing for a contract with your 

employer setting your wages, benefits, 

hours, and other working conditions.’’ 

Based on comments, the next two 

provisions—discuss terms and 

conditions of employment and take 

action—have been substantially 

modified to achieve several goals. First, 

the Department agrees that these two 

provisions as presented in the proposed 

notice could be simplified and clarified 

by separating employees’ 

communication rights from their 

conduct rights. In addition, the 

Department agrees that inclusion of the 

right to leaflet was duplicative of the 

provision regarding employer 

interference with distribution of union 

literature, and so this reference has been 

deleted from the final notice. Next, the 

Department decided to delete the 

reference to the right to attend rallies on 

non-work time so as not to complicate 

a list of essential and fundamental rights 

under the NLRA. Finally, because the 

reference in the proposed notice to 

‘‘seeking and receiving help from a 

union’’ was moved to the following 

provision and in an effort to retain the 

concept that employees can discuss 

union-related activity among 

themselves, the Department added to 

the employee discussion provision the 

right to talk about unions and union 

organizing. As a result, the two 

provisions in the final notice state that 

employees have the right to, ‘‘discuss 

your terms and conditions of 

employment or union organizing with 

your co-workers or a union’’ and ‘‘take 

action with one or more co-workers to 

improve your working conditions by, 

among other means, raising workrelated complaints directly with your 

employer or with a government agency, 

and seeking help from a union.’’ 

As noted earlier, the provision in the 

proposed notice related to the rights to 

strike and picket received several 

comments. Labor organizations 

suggested the removal of the references 

to a contractual no-strike provision, 

permanent replacements, and the phrase 

‘‘subject to certain other limitations.’’ By 

contrast, comments from employers 

suggested the provision is flawed 

because of the absence of the many 

limitations, exceptions, and distinctions 

related to these rights. By necessity, the 

notice cannot contain an exhaustive list 

of limitations on and exceptions to the 

rights to strike and picket, as suggested 

by employers. Indeed, the various 

permutations of these rights 

comprehensively documented by such 

comments reflect that in highlighting 

just a few limitations, or referring to 

them ambiguously as ‘‘other 

limitations,’’ the proposed notice fell 

short of the goal to clearly inform 

employees about their rights. However, 

because exercising the right to strike, in 

particular, can significantly affect the 

livelihood of employees, the 

Department considers it vital to reflect 

in one general phrase that there are 

caveats associated with it. The 

Department is satisfied that the addition 

of a general caveat, coupled with the 

admonition in the new introduction to 

contact the NLRB with specific 

questions about the application of rights 

in certain situations, provides sufficient 

guidance to employees about the 

exercise of these rights while still 

staying within the constraints set by a 

necessarily brief employee notice. Thus, 

this provision in the final notice states 

that employees have the right to ‘‘Strike 

and picket, depending on the purpose or 

means of the strike or the picketing.’’ 

As noted, the Department received 

several comments suggesting that the 

notice contain provisions related to 

Beck rights. The final notice will retain, 

as part of the right to refrain, the 

provision stating that an employee has 

the right to not join or remain a member 

of a union that represents the 

employee’s bargaining unit. However, 

further explication of Beck rights will 

not be included because of space 

limitations and because of the policy 

choice, as expressed in Executive Order 

13496, to revoke a more explicit notice 

to employees of Beck rights. See Sec. 13, 

E.O. 13496, 74 FR at 6110. 

c. The Examples of Unlawful Conduct 

in the Final Notice 

The Department has decided that 

three examples of unlawful employer 

conduct—regarding unlawful threats to 

close, promises or grants of benefits, and 

spying or videotaping—need no revision 

for the final notice. The comments 

related to these three provisions all 

shared a common theme, as discussed 

above, that the provisions are 

overgeneralizations that neither capture 

the legal standard associated with 

evaluating allegations of unlawful 

conduct nor indicate factual scenarios 

in which the highlighted conduct may 

be lawful. After review of these 

comments and the case law cited 

therein, the Department concludes that 

the provisions as proposed are accurate 

and informative, and, as with the notice 

as a whole, strike an appropriate 

balance between being simultaneously 

instructive and succinct. 

The Department has decided to 

modify the remaining four examples of 

illegal employer conduct in order to 

clarify them. First, the Department has 

modified the provision related to 

employers’ no-solicitation and nodistribution rules for the final notice. 

The Department agrees with those 

comments suggesting that the terms 

‘‘non-work time’’ and ‘‘non-work areas,’’ 

while used commonly in Board law, are 

not readily ascertainable, and the 

addition of common examples of each 

would assist employees in 

understanding their rights. Therefore, 

the provision was modified to clarify 

the meaning of ‘‘non-work time’’ and 

‘‘non-work areas.’’ The remaining 

comments suggesting the inclusion of 

the various circumstances in which nosolicitation and no-distribution rules 

may be lawful were rejected due to 

limitations imposed by a notice format. 

More specifically, the Department 

recognizes that under the NLRB’s 

precedent, a hospital’s prohibition of 

solicitation or distribution of literature 

in immediate patient care areas, even 

during employees’ nonworking time, is 

presumptively lawful. Brockton 

Hospital, 333 NLRB 1367, 1368 (2001). 


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13The Department notes that the NLRB reported 

that in fiscal year 2008, 22,497 unfair labor practice 

charges were filed. Seventy-Third Annual Report of 

the National Labor Relations Board for the Fiscal 

Year Ended September 30, 2008, at 5, available at 

http://www.nlrb.gov/nlrb/shared_files/brochures/ 

annual%20reports/NLRB2008.pdf. Of these, 16,179 

charges were against employers, and 6,210 charges 

were filed against unions. Id. Thirty-nine percent of 

all charges were found to have merit, and 1108 

complaints were issued. Id. at 7. Of complaints 

issued, 86 percent were against employers and 14 

percent were against unions. Id. at 8. 

Once again, however, the limitations on 

the format preclude the inclusion of 

factual permutations in which a general 

right may not apply or may only apply 

with qualifications, and hospital 

employees, as well as other employees, 

can contact the NLRB with specific 

questions about the lawfulness of their 

employers’ rules governing solicitation 

and literature distribution. Finally, the 

Department acknowledges, as one 

comment noted, that the NLRB 

distinguishes between ‘‘solicitation’’ for 

a union, which generally means 

encouraging a coworker to participate in 

supporting a union, and so-called 

‘‘union talk,’’ which generally refers to 

discussions about the advantages and 

disadvantages of unionization. W.W. 

Grainger, 229 NLRB 161, 166 (1977), 

enforced, 582 F.2d 1118, (7th Cir.1978); 

Jensen Enterprises, Inc., 339 NLRB 877, 

878 (2003). However, this provision is 

intended to expressly address the 

former; the right to engage in ‘‘union 

talk’’ is now encompassed more 

specifically by the revision, as noted 

above, to the ‘‘discussion’’ provision in 

the affirmative rights section of the final 

notice. Accordingly, this provision in 

the final notice indicates that it is illegal 

for employers to ‘‘prohibit you from 

soliciting for a union during non-work 

time, such as before or after work or 

during break times; or from distributing 

union literature during non-work time, 

in non-work areas, such as parking lots 

or break rooms.’’ 

The comments about the next 

provision regarding employers’ 

questions about union support or 

activity correctly note that the Board’s 

test for determining the legality of such 

questions is whether under all the 

circumstances the interrogation 

reasonably tends to restrain, coerce, or 

interfere with rights guaranteed 

employees by the Act. Rossmore House, 

269 NLRB 1176, 1177 (1984), enforced, 

760 F.2d 1006 (9th Cir. 1985). Under 

this totality of circumstances approach, 

consideration is given to whether the 

interrogated employee is an open or 

active supporter of the union, the 

background surrounding the 

interrogation, the nature and purpose of 

the information sought, the identity of 

the questioner, the place and/or method 

of the interrogation, and the truthfulness 

of any reply by the questioned 

employee. Id. The Board has said that 

these factors are not to be mechanically 

applied but rather are useful indicia that 

serve as a starting point for assessing the 

totality of the circumstances. Id. The 

comments suggesting revisions of this 

provision, as with many of the prior 

suggestions, request inclusion of 

substantial detail, much of which is 

beyond the purview of this notice. 

However, the Department has 

concluded that the provision would be 

clarified by reference to the concepts 

that unlawful questioning interferes 

with employees’ Section 7 rights and 

that the interference is judged under the 

circumstances of the questioning. Thus, 

this provision in the final notice states 

that it is unlawful for employers to 

‘‘question you about your union support 

or activities in a manner that 

discourages you from engaging in that 

activity.’’ 

Comments about employers’ taking, or 

threatening to take, adverse action 

against employees because of their 

union-related or other protected activity 

request the inclusion of complicated 

references to legal complexities, such as 

the application of a burden-shifting 

analysis to determine whether unlawful 

discrimination has occurred, Wright 

Line, Inc., 251 NLRB 1083 (1980), or the 

consideration of the impact of right-towork laws. This provision is intended to 

supply employees with notice of their 

fundamental right to be free from 

discrimination based on union activity, 

and its accuracy and instructiveness 

will be diminished by such complicated 

references. However, the Department 

agrees with one comment suggesting 

that the provision can be improved with 

the substitution of one word to 

underscore that the protections of the 

NLRA attach to activity that is concerted 

in nature. Thus, this provision in the 

final notice instructs employees that it 

is unlawful for employers to ‘‘fire, 

demote, or transfer you, or reduce your 

hours or change your shift, or otherwise 

take adverse action against you, or 

threaten to take any of these actions, 

because you join or support a union, or 

because you engage in concerted 

activity for mutual aid and protection, 

or because you choose not to engage in 

any such activity.’’ 

The final provision regarding 

unlawful employer conduct that the 

Department decided to revise is related 

to union insignia in the workplace. 

Generally, an employer may not 

prohibit the wearing of union insignia, 

absent special circumstances. Airport 

2000 Concessions, LLC, 346 NLRB 958, 

960 (2006). For reasons of format, the 

notice cannot accommodate those 

comments suggesting that this provision 

specify those cases in which the Board 

has found ‘‘special circumstances’’ to 

exist, such as where insignia might 

interfere with production or safety; 

where it conveys a message that is 

obscene or disparages a company’s 

product or service; where it interferes 

with an employer’s attempts to have its 

employees project a specific image to 

customers; where it hinders production; 

where it causes disciplinary problems in 

the plant; or where it would have any 

other consequences that would 

constitute special circumstances under 

settled precedent. Escanaba Paper Co., 

314 NLRB 732 (1994), enforced, 73 F.3d 

74 (6th Cir. 1996). In addition, as noted 

earlier, an employer’s prohibition on 

wearing union insignia in immediate 

patient care areas is presumptively 

valid. London Memorial Hospital, 238 

NLRB 704, 708 (1978). This lengthy list 

supplied by some comments highlights 

that the addition of only one example of 

‘‘special circumstances’’—the patient 

care example—may mislead or confuse 

employees. Thus, the general caveat that 

special circumstances may defeat the 

application of the general rule, coupled 

with the advice to employees to contact 

the NLRB with specific questions about 

particular issues, achieves the balance 

required for an employee notice of 

rights about union insignia in the 

workplace. 

The proposed notice had only one 

very broad description of union conduct 

that is unlawful under the NLRA. 

Although this provision generally 

encompassed a wide range of illegal 

union activity, it was criticized in 

comments for lacking specificity, and 

thus resulting in imbalance as compared 

to the examples of unlawful employer 

activity.13 After reviewing the 

comments, the Department has revised 

the notice in order to more thoroughly 

reflect the range of unlawful union 

conduct. 

Thus, the final notice contains the 

following five examples of unlawful 

union conduct: 

• Threaten you that you will lose 

your job unless you support the union. 

• Refuse to process a grievance 

because you have criticized union 

officials or because you are not a 

member of the union. 

• Use or maintain discriminatory 

standards or procedures in making job 

referrals from a hiring hall. 

• Cause or attempt to cause an 

employer to discriminate against you 

because of your union-related activity. 


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• Take other adverse action against 

you based on whether you have joined 

or support the union. 

d. The Inclusion of the Duty to Bargain 

in Good Faith 

The Department agrees with those 

comments that suggested that 

employees should be aware that their 

employer and their bargaining 

representative have a statutory duty to 

bargain in good faith. Thus, the final 

notice states that ‘‘if you and your 

coworkers select a union to act as your 

collective bargaining representative, 

your employer and the union are 

required to bargain in good faith in a 

genuine effort to reach a written, 

binding agreement setting your terms 

and conditions of employment. The 

union is required to fairly represent you 

in bargaining and enforcing the 

agreement.’’ The latter sentence 

regarding the union’s duty of fair 

representation is somewhat duplicative 

of provisions above exemplifying union 

misconduct, but the Department 

concluded that it was important to note 

a union’s duty to fairly represent all 

bargaining unit members specifically in 

connection with its obligation to bargain 

in good faith. 

e. The Contact Information 

The proposed notice contained two 

paragraphs about the NLRB, its 

enforcement procedures, and its contact 

information, which have been 

streamlined into one paragraph for the 

final notice. In doing so, and after 

reviewing the comments, the 

Department has substituted the word 

‘‘should’’ for the word ‘‘must’’ to indicate 

that it is not mandatory that the NLRB 

be notified of unlawful conduct; 

retained the admonition to employees to 

act promptly and within the six month 

statute of limitations; added a sentence 

that underscores the confidentiality 

associated with contacting the NLRB; 

added a sentence that indicates that 

anyone can file a charge with the NLRB; 

and retained the sentence relating to 

possible reinstatement, back pay and 

cease-and-desist remedies. The final 

notice, as modified on the basis of 

comments discussed above, is set forth 

in Appendix A to Subpart A of this rule. 

D. Incorporation of the Contract Clause 

in Government Contracts and 

Subcontracts 

As proposed in § 471.2(a), all 

nonexempt prime contractors and 

subcontractors are required to include 

the employee notice contract clause in 

each of their nonexempt contracts and 

subcontracts. In order to ensure that 

contractors are made aware of their 

contractual obligation to post the 

required notice, proposed § 471.2(b) 

provided that the employee notice 

contract clause must be set out verbatim 

in a contract, subcontract or purchase 

order, rather than being incorporated by 

reference in those documents. In the 

NPRM, the Department requested 

comment regarding the utility of setting 

out the employee notice clause 

verbatim, as opposed to incorporation of 

the clause by reference. 

The Department received ten 

comments about this requirement, only 

one of which agreed with the 

Department that full inclusion of the 

employee notice clause in every 

contract and subcontract will ensure 

that contractors and subcontractors fully 

understand their obligations under the 

rule. The other nine comments 

suggested that the rule should permit 

the inclusion of the employee notice 

clause by reference for various reasons, 

including that full inclusion provides 

little utility, and is burdensome and 

unreasonable because many contractors 

would have to substantially revise their 

procurement and contract documents, 

many of which are purposefully brief, 

standard-form documents, in order to 

comply. One commenter noted that 

because the content of the notice itself 

may be subject to updating, the contract 

clause will also require modification, 

and contractors who are unaware of the 

necessary update may inadvertently rely 

on outdated contract documents or 

provisions. Another commenter 

suggested that the notice in the contract 

clause is very long and contains 

language that will confuse readers of 

contracts and purchase orders. Finally, 

several commenters also noted that the 

prohibition on incorporation by 

reference is inconsistent with various 

laws—some of which are implemented 

by the Department—that permit contract 

clause incorporation by reference, 

including Executive Order 11246, 

Vietnam Era Veterans Readjustment 

Assistance Act, and Section 503 of the 

Rehabilitation Act of 1973, among 

others. 

Following full consideration of these 

comments, and in order to ease 

contractor compliance with the 

requirements of this rule, the 

Department has decided to permit 

inclusion of the employee notice clause 

by reference. Therefore, in place of 

proposed § 471.2(b) that disallowed 

incorporation by reference, the final rule 

contains a new § 471.2(b), that permits 

incorporation by reference. The 

Department has coordinated with the 

FAR Council to implement this 

provision. 

E. Application of the Rule to Contractors 

and Subcontractors; Exceptions and 

Exemptions; Other Limitations 

As proposed in § 471.2(a), all 

nonexempt prime contractors and 

subcontractors are required to include 

the employee notice contract clause in 

each of their nonexempt subcontracts so 

that the obligation to notify employees 

of their rights flows to subcontractors of 

a government contract as well. The 

Executive Order expressly excepts from 

its application two types of Government 

contracts: Collective bargaining 

agreements as defined in 5 U.S.C. 

7103(a)(8) and contracts involving 

purchases below the simplified 

acquisition threshold as defined in the 

Office of Federal Procurement Policy 

Act, 41 U.S.C. 403. Sec. 2, 74 FR at 

6107. The simplified acquisition 

threshold is currently set at $100,000. 

41 U.S.C. 403. Section 471.3(a)(1) and 

(2) of the proposed rule implemented 

these exceptions. 74 FR at 38498. In 

addition, the Executive Order’s 

provision regarding its effective date 

excepts contracts resulting from 

solicitations issued prior to the effective 

date of the final rule promulgated 

pursuant to this rulemaking. Sec. 16, 74 

FR 6111. Proposed § 471.3(a)(3) 

implemented this provision of the 

Executive Order. 74 FR at 38498. 

The NPRM concluded that the 

obligations of the rule apply to 

government contractors and all 

subcontractors of the government 

contract, regardless of whether the 

subcontractor is a first-tier subcontractor 

or a more remote subcontractor. This 

conclusion was based on the 

Department’s construction of the 

interrelated terms of the Executive 

Order. The NPRM noted that paragraph 

4 of the contract clause in the Executive 

Order requires the contractor to 

incorporate only paragraphs 1 through 3 

of the clause in its subcontracts. 74 FR 

at 38490. A narrow reading of the 

operation of this provision outside the 

full context of the Executive Order, the 

NPRM noted, might suggest that the 

obligation to include the contract clause 

is limited to contracts between the 

government agency and the prime 

contractor. Id. Under this reading, 

subcontractors would be required only 

to post the notice of employee rights, 

and their subcontractors (sometimes 

called second-tier contractors) would 

have no responsibilities under the 

Executive Order. However, the NPRM 

reasoned that provisions of the 

Executive Order establishing 

exemptions and exceptions for the 

application of the Executive Order’s 

obligations do not expressly specify that 


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its obligations do not flow past the firsttier subcontractor, a significant 

limitation that would normally be made 

explicit in the text of the Executive 

Order rather than by operation of the 

contract clause’s incorporation 

provision. In addition, the NPRM noted 

that in the Department’s past regulatory 

treatment of a similar issue, it had 

adapted through regulation the 

application of an executive order’s 

contract inclusion provisions so that the 

obligation to abide by the mandates of 

the orders flows to subcontractors below 

the first tier. See, e.g., 69 FR 16378, Mar. 

29, 2004 (final rule implementing E.O. 

13201) (based on identical contract 

incorporation provision, ‘‘the intent of 

the Order was clearly that the clause be 

passed to subcontractors below the first 

tier’’); 57 FR 49591, Nov. 2, 1992 (final 

rule implementing E.O. 12800) (‘‘It is 

clear, however, that the intent of 

Executive Order 12800 was that the 

clause flow down below the first-tier 

level’’). The NPRM concluded that the 

Department’s experience with 

regulatory implementation of prior 

executive orders establishing that the 

obligations of those orders flow past the 

first-tier subcontractor supported the 

application of this rule to subcontractors 

below the first tier, and best achieves 

the purposes of this Executive Order. 74 

FR at 38491. Accordingly, the 

Department concluded that in order to 

fully implement the intent of Executive 

Order 13496, proposed § 471.2(a) was 

adapted to require the inclusion of 

paragraphs 1 through 4, rather than 1 

through 3, of the contract clause. The 

Department specifically sought 

comments on this proposal. 

The NPRM also concluded that 

although the Executive Order clearly 

did not apply to government contracts 

for purchases below the simplified 

acquisition threshold, the Executive 

Order did not provide for the same 

exception for subcontracts involving 

purchases below the simplified 

acquisition threshold. However, the 

Department noted that inclusion of the 

express limitation in the definition of 

‘‘subcontract’’ that ‘‘subcontracts’’ consist 

only of those instruments that are 

‘‘necessary to the performance of the 

government contract,’’ NPRM § 471.1(r), 

was intended as a control on the 

otherwise universal application of the 

rule to subcontracts. 74 FR at 38491, 

citing OFCCP v. Monongahela R.R., 85– 

OFC–2, 1986 WL 802025 

(Recommended Decision and Order, 

April 2, 1986), aff’d, (Deputy Under 

Secretary’s Final Decision and Order, 

Mar. 11, 1987) (railroad transporting 

coal to power generation plant of energy 

company contracting with GSA was 

subcontractor because delivery of coal is 

necessary for the power company to 

perform under its contract with GSA). 

Thus, the NPRM noted that although the 

rule may result in coverage of 

subcontracts with relatively de minimis 

value in the overall scheme of 

government contracts, covered 

subcontractors include only those who 

are performing subcontracts that are 

necessary to the performance of the 

prime contract. The Department invited 

comment on whether a further 

limitation on the application of the rule 

to subcontracts is necessary, and if it is, 

whether such a limitation is best 

accomplished through the application of 

this or another standard, for instance, a 

threshold related to the monetary value 

of the subcontract. 

The Department received numerous 

comments about the application of the 

rule to subcontractors below the first 

tier, the non-application of the 

simplified acquisition threshold to 

subcontractors, and the proposed 

‘‘necessary to the performance’’ 

limitation on the application of the rule 

to subcontractors. Four comments 

supported the application of the rule to 

subcontractors below the first tier. 

These commenters noted various 

reasons for their support, including that 

application of the rule to more remote 

subcontractors would prevent 

circumvention of the rule through 

subcontracting, would further the 

Executive Order’s goal of preventing 

labor unrest, and was similar to the 

Department’s implementation of prior 

executive orders. One commenter noted 

that it is not unusual for a vast majority 

of laborers on a jobsite to be employed 

by subcontractors of the prime 

contractor or its subcontractors, and that 

the rule should apply equally to such 

jobsites regardless of the remoteness of 

the subcontract to the prime contract. 

Three commenters argued that the 

Department should not apply the rule to 

subcontractors below the first tier, and 

one commenter requested clarification 

on the application of the rule below the 

first tier. Those comments opposing 

lower-tier application suggested that the 

rule has gone too far in its application, 

and that coverage of the rule should be 

limited to first-tier subcontractors. One 

commenter in particular disagreed with 

the Department’s modification of the 

contract inclusion provision discussed 

above, contending that the Department’s 

reliance on its prior regulatory 

implementation of Executive Orders 

13201 and 12800 was inapt. The 

commenter noted that each of those 

executive orders contained a provision, 

not present in Executive Order 13496, 

stating that the Secretary may exempt 

‘‘subcontracts below an appropriate tier 

set by the Secretary,’’ thus indicating 

that the application of the rule to any 

tier of subcontractors was contemplated 

by the executive order but subject to 

administrative limitation. See Sec. 

3(b)(v), E.O. 13201, 66 FR 11221, Feb. 

22, 2001 (revoked by Executive Order 

13496); Sec. 3(b)(v), E.O. 12800, 57 FR 

12985, April 13, 1992 (revoked by 

Executive Order 12836). By contrast, the 

commenter notes, Executive Order 

13496 contains no such language 

permitting the Secretary to limit the 

application of the rule, thus indicating 

that flow-down below the first tier is not 

contemplated by the plain language of 

the Executive Order. 

The Department received eleven 

comments regarding the proposal in the 

NPRM to apply the simplified 

acquisition threshold only to 

government contracts and not to 

subcontracts, and all universally stated 

that the simplified acquisition threshold 

should apply to subcontracts as well. 

Most comments noted the incongruity 

associated with the application of the 

threshold to prime contracts but not to 

subcontracts, asserting that it makes 

little sense to except prime contracts 

below a set monetary limit but then 

apply the rule to reach subcontracts 

below that same limit. Most negative 

comments similarly noted that the 

failure to apply the simplified 

acquisition threshold to subcontracts 

will result in coverage of very small 

contracts and contractors, which, they 

argue, the Executive Order clearly 

intended to avoid by requiring the 

application of the dollar limit to prime 

contracts. Coverage of small 

subcontractors is burdensome to those 

contractors, many commenters asserted, 

and will result in the application of the 

rule to very small procurement contracts 

and will discourage some contractors 

from bidding for work associated with a 

government contract. Some commenters 

said they failed to see the policy reason 

supporting the non-application of the 

threshold to subcontracts. One 

commenter contended that the 

application of the rule to small 

subcontractors violates a Congressional 

mandate in the Small Business Act, 15 

U.S.C. 637(d), that requires Federal 

agencies to give preference to small and 

disadvantaged businesses. Another 

comment noted the apparent 

inconsistency in proposed 

§ 471.3(a)(2)(ii), which applies the 

simplified acquisition threshold to 

‘‘contracts and subcontracts’’ for an 

indefinite quantity, but not to contracts 


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for a defined quantity. As noted above 

in the discussion of comments about the 

rule’s definition section, because the 

definitions of ‘‘contract’’ and 

‘‘contractor’’ include ‘‘subcontract’’ and 

‘‘subcontractor,’’ commenters argued 

that the rule by its terms does in fact 

apply the simplified acquisition 

threshold to limit its application to 

subcontracts. Finally, one commenter 

suggested that if the Department is 

concerned that application of the 

simplified acquisition threshold to 

subcontractors will unnecessarily limit 

the reach of the rule to small 

contractors, it should nevertheless 

include some other limitation on the 

application of the rule to prevent its 

application to very small contractors. 

The Department’s proposed limitation 

on the application of the rule to only 

those subcontracts that are ‘‘necessary to 

the performance of the prime contract’’ 

received little support from 

commenters. By contrast, five 

commenters submitted that the term 

was so general and vague as to be 

completely ineffective as a significant 

limitation on the rule’s application. Two 

commenters suggested that all 

subcontracts in some manner, no matter 

how attenuated, are necessary to the 

performance of the prime contract, or 

the subcontract would not have been 

executed in the first place. In this vein, 

one commenter noted that the 

Department’s use of the phrase suggests 

pejoratively that some subcontracts are 

unnecessary to the performance of the 

government contract. Other commenters 

queried how a subcontractor at the time 

of the execution of the subcontract is to 

know whether the subcontract is 

necessary to the performance of the 

government contract, particularly when 

such a determination by the Department 

will only be made during subsequent 

enforcement proceedings that may have 

adverse consequences for the 

subcontractor. One commenter noted 

that when a subcontractor or vendor 

receives a purchase order from a firm, 

the subcontractor or vendor may have 

no way of knowing of the purchase 

order’s connection to a government 

contract without conducting an 

investigation into the purchaser’s 

connections, which may be considered 

intrusive. One commenter stated that 

the Department’s reliance on OFCCP v. 

Monongahela R.R., 85–OFC–2, 1986 WL 

802025 (Recommended Decision and 

Order, April 2, 1986), aff’d, (Deputy 

Under Secretary’s Final Decision and 

Order, Mar. 11, 1987) to support 

explication of the phrase raised 

concerns because the rule should not 

apply to subcontractors that only supply 

material to a job site but do not install 

it. 

Four commenters suggested 

alternative standards that would serve 

to limit the application of the rule to 

subcontractors. Suggested limitations 

included establishing a value for de 

minimis subcontracts to which the rule 

would not apply, which was phrased by 

another commenter as establishing an 

exemption for small contractors based 

on the monetary value of the 

subcontract; creating an exception for 

application of the rule to firms with a 

small, defined number of employees; 

and application of the rule to only those 

contractors and subcontractors that 

provide services, as opposed to 

supplies, to the government. One 

commenter noted that the rule should 

include a ‘‘minimum size threshold 

[below] which a contractor is exempt,’’ 

but the commenter did not indicate 

whether the limit should be connected 

to the size of the subcontract’s value, the 

size of the subcontractor’s workforce, or 

the size of the subcontractor’s revenue. 

This same commenter submitted that 

the rule must also provide some means 

by which a subcontractor will be 

notified that the subcontract is covered 

by the rule and some clarification on 

compliance in those situations in which 

a subcontractor does not have control 

over the site where the prime contract 

is being performed. 

After carefully considering all the 

comments related to the application of 

the rule to subcontractors, the 

Department has made the following 

decisions. The Department will retain 

the provision, as proposed in 

enumerated paragraph 4 of the contract 

clause set out in Appendix A 

(‘‘paragraph 4’’), requiring government 

contractors to incorporate paragraphs (1) 

through (4) in every subcontract. As 

noted in the proposal, the contract 

inclusion provision in paragraph 4 

cannot be read in isolation, but rather it 

must be read in conjunction with other 

operative words and phrases of 

paragraph 4 and in the Executive Order 

as a whole in order to fully implement 

its purpose. Many aspects of the 

Executive Order demonstrate the 

President’s intent to apply the 

obligations of the Order not just to 

government contracts, but also to 

subcontracts of the government contract 

at all levels. As the proposal noted, no 

other provision in the Executive Order, 

save for the mechanical operation of 

paragraph 4, suggests that the intent of 

the Executive Order was to except 

subcontracts below the first tier. The 

Department concludes that silence in 

failing to include lower tier 

subcontractors in the Executive Order’s 

exemptions and exceptions provisions 

indicates that they were meant to be 

covered. In addition, the Department 

broadly interprets paragraph 4’s 

directive that the contractor ‘‘will 

include the provisions of paragraphs 1 

through 3 above in every subcontract 

entered into in connection with this 

contract * * * so that such provisions 

will be binding upon each 

subcontractor[.]’’ The Department reads 

the terms ‘‘will include’’ in ‘‘every 

subcontract’’ to mean that the initial 

contractor will ensure, to the extent 

possible, that the posting obligation will 

be included in all subcontracts in 

connection with the prime contract, 

whether at the first tier level or below. 

Read in this fashion, this directive can 

be implemented only by requiring, as 

does the final rule, that every 

subcontract pass through such an 

obligation to any lower tier 

subcontractors. In addition, the 

Department interprets broadly the 

reference to ‘‘contractor’’ in paragraph 4 

(‘‘The contractor will include 

paragraphs (1) through (3) above * * *’’) 

to encompass a ‘‘subcontractor,’’ so that 

the provision is read to require each 

subcontractor on a government contract, 

regardless of tier, to include posting 

requirements in any of its subcontracts. 

Other provisions in the Executive 

Order outside paragraph 4 evince an 

intent to apply the rule to subcontracts 

below the first tier. References to 

‘‘contractors’’ (Sec. 1), ‘‘any Government 

contractor, subcontractor, or vendor’’ 

(Sec. 5), and ‘‘a Government contractor 

or subcontractor’’ (Sec. 5) are 

unqualified or modified, and the 

Department interprets the references to 

mean subcontractors at all tiers. This 

broad interpretation is most fitting in 

application to the statement of policy in 

Section 1 of the Executive Order, which 

provides that ‘‘[w]hen the Federal 

government contracts for goods or 

services, it has a proprietary interest in 

ensuring that those contracts will be 

performed by contractors whose work 

will not be interrupted by labor unrest’’ 

and ‘‘relying on contractors whose 

employees are informed of such rights 

under Federal labor laws facilitates the 

efficient and economical completion of 

the Federal Government’s contracts.’’ 74 

FR 6107. Given the frequency with 

which the performance of government 

contracts are subcontracted, the policy 

of the Executive Order is best 

understood as reaching contracts below 

the first tier. This is particularly true 

when the government contract is, for 

instance, a large, multi-million dollar 

transaction, and its performance is 

subcontracted in multiple tiers. The 


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economy and efficiency that is sought to 

be promoted by the Executive Order 

would not be realized if subcontractors 

below the first tier of a large government 

contract were not subject to this rule, 

and a labor dispute at a lower tier 

subcontractor interfered with the 

delivery of the large prime contract. In 

such a case, ‘‘the efficient and 

economical completion of the Federal 

Government’s contracts’’ would not be 

realized. 74 FR 6107. As a result, the 

Department interprets the Executive 

Order as a whole as seeking to avoid just 

such a scenario. 

In addition, as noted in the proposal, 

the interpretation of Executive Order 

13496 has been informed by the 

interpretation of Executive Orders 

12800 and 13201. In both those cases, 

the Department similarly interpreted the 

text of the orders, which had contract 

incorporation provisions that were 

virtually identical to paragraph 4 of 

Executive Order 13496, to provide for 

application of the obligations to 

subcontractors below the first tier. See 

69 FR 16378, Mar. 29, 2004; 57 FR 

49591, Nov. 2, 1992. The Department 

has concluded that Executive Order 

13496 was drafted with awareness of 

these earlier Executive Orders, and that 

it was intended to be implemented in 

the same manner as its predecessors. 

One commenter emphasized that the 

regulatory implementation of Executive 

Orders 12800 and 13201 was 

supportable because those orders 

granted authority to the Secretary to 

exempt subcontracts below an 

appropriate tier, suggesting application 

of the obligations of those orders to 

lower contract tiers. See Section 3(b)(v) 

of Executive Orders 12800 and 13201, 

57 FR 12986, Apr. 13, 1991; 66 FR 

11222, Jan. 17, 2001 (‘‘subcontracts 

below an appropriate tier set by the 

Secretary’’ may be exempted). In this 

case, the comment notes, Executive 

Order 13496 does not grant the 

Secretary similar regulatory authority to 

exempt contracts below an appropriate 

tier, thus suggesting that the Executive 

Order does not contemplate reaching 

contracts other than first tier 

subcontracts. However, the Department 

views the absence of such regulatory 

authority to exempt contracts below a 

certain tier as supporting its 

interpretation that the Executive Order 

intends that its obligations are to apply 

to all subcontracts of the prime contract 

regardless of tier. The President omitted 

from Executive Order 13496 any 

administrative authority to exempt 

lower tier subcontractors because he did 

not intend to permit any tier-based 

exemption, and not because it was 

contemplated that lower tier 

subcontractors would, at some point, be 

outside the reach of the purposes of the 

Executive Order. Thus, the Department 

interprets silence as to tier coverage 

within the text of the Executive Order 

as reflecting an intent for all tiers to be 

covered. 

The Department’s grant of authority to 

promulgate regulations under the 

Executive Order is broad, and permits 

the Department to implement the Order 

in a manner that is ‘‘necessary and 

appropriate to achieve the purposes’’ of 

the Order. Sec. 3(a), 74 FR at 6108. In 

addition, the Secretary has the express 

authority under the Executive Order to 

‘‘make modification of the contractual 

provisions * * * necessary to achieve 

purposes of this order[.]’’ Sec. 3(c), 74 

FR at 6108. Accordingly, in order to 

implement the purpose, intent, and 

express provisions of the Executive 

Order, which the Department concludes 

applies to nonexempt government 

contracts and all subcontracts of the 

government contract, the Department 

will retain paragraph 4 of the contract 

clause as proposed. 

The Department will also retain the 

interpretation set out in the proposal 

that the exception for contracts below 

the simplified acquisition threshold 

applies only to the prime contract. The 

Department views as plain and 

unambiguous the text of the Executive 

Order on this point. Section 2 of the 

Order states that ‘‘all Government 

contracting departments and agencies 

shall, to the extent consistent with law, 

include the [contract clause] in every 

Government contract, other than * * * 

purchases under the simplified 

acquisition threshold. * * *’’ 74 FR 

6107 (emphasis added). Based on this 

provision, the exception for contracts 

below the simplified acquisition 

threshold applies only to the original 

government contract, and has no 

application to subsequent subcontracts. 

In response to comments, the 

Department does not consider the 

result—excepting prime contracts below 

the simplified acquisition threshold and 

covering subcontracts below that 

threshold—to be incongruous. The 

Department concludes that the 

Executive Order embodies a sound 

policy choice that when the Federal 

government enters into a large prime 

contract (defined as exceeding the 

simplified acquisition threshold), all 

employees working under the umbrella 

of that prime contract will be notified of 

their rights under federal labor law, 

including employees of lower tier 

subcontractors. Indeed, it would be 

incongruous to seek economical and 

efficiency improvements in government 

procurement through a well-informed 

contractor workforce and yet not apply 

those standards to all subcontracts 

flowing from the covered prime contract 

regardless of their size. The Department 

notes that the application of the rule to 

subcontracts below the simplified 

acquisition threshold presents no 

greater notice-posting obligation than 

many of those employers already have 

with other notice-posting obligations 

under various labor and employment 

laws. For instance, the notice-posting 

obligation of USERRA, the Uniformed 

Services Employment and 

Reemployment Rights Act, requires all 

employers regardless of size to post 

notices to their employees about their 

USERRA rights. 38 U.S.C. 4334; 20 CFR 

1002 (implementing regulations). The 

reach of this rule is not incompatible or 

inconsistent with the reach of other 

labor and employment notice-posting 

obligations. 

After full consideration of comments 

about the application of the rule to de 

minimis value subcontracts, the 

Department has concluded that it is 

‘‘necessary and appropriate,’’ Sec. 3 of 

the Executive Order, to establish a de 

minimis value standard for subcontracts 

below which the rule will not apply. 

Such a standard expressly employs the 

principle that certain activity is of such 

modest concern to the application of the 

legal standard that it can be set apart 

from its application. Wisconsin Dept. of 

Revenue v. William Wrigley, Jr., Co., 505 

U.S. 214 (1992) (the maxim—‘‘the law 

cares not for trifles’’—is part of the 

established background of legal 

principles against which all enactments 

are adopted, and which all enactments 

(absent contrary indication) are deemed 

to accept). A de minimis standard based 

on the dollar value of the subcontract 

also has the advantage of permitting 

subcontractors to ascertain at the time of 

entry into the subcontract that this rule 

will or will not apply to them. In 

implementing the equal opportunity 

contract clause requirements of 

Executive Order 11246, the Department 

has established a $10,000 threshold for 

contracts and subcontracts below which 

that rule will not apply. See 41 CFR 60– 

1.5(a). The Department considers 

suitable the application of a similar 

$10,000 threshold for subcontracts 

below which this rule will not apply, 

and this de minimis standard has been 

added to § 471.3(a)(4). In addition, as 

with the admonition in § 471.3(a)(2)(i) 

that agencies and contractors may not 

enter into contracts so as to avoid the 

application of the rule, contractors and 

subcontractors similarly may not enter 

into contracts so as to avoid application 

of the rule, and that constraint has also 


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been added to § 471.3(a)(4). In addition 

to the exception for de minimis 

contracts, the definition of subcontract, 

as proposed in the NPRM, will continue 

to be limited to those that are ‘‘necessary 

to the performance of’’ the government 

contract. 

In addition to the exceptions for 

certain contracts, the Executive Order 

establishes two exemptions that the 

Secretary, in her discretion, may 

provide to contracting department or 

agencies that the Secretary finds 

appropriate for exemption. Sec. 4, 74 FR 

6108. These provisions permit the 

Secretary to exempt a contracting 

department or agency or group of 

departments or agencies from the 

requirements of any or all of the 

provisions of the Order with respect to 

a particular contract or subcontract or 

any class of contracts or subcontracts if 

she finds either that the application of 

any of the requirements of the Order 

would not serve its purposes or would 

impair the ability of the government to 

procure goods or services on an 

economical and efficient basis, or that 

special circumstances require an 

exemption in order to serve the national 

interest. Id. Proposed § 471.3(b) 

implemented these exemptions, and 

provided for the submission of written 

requests for exemptions to the Director 

of OLMS. It also provided that the 

Director may withdraw an exemption if 

a determination is made that such 

action is necessary or appropriate to 

achieve the purposes of the rule. The 

Department invited comments on the 

standards and procedures for requesting 

an exemption and the Department’s 

withdrawal of a granted exemption, but 

received no comments applicable to 

these proposed revisions. Therefore, the 

proposed provisions implementing the 

exemptions stated in the Executive 

Order have been carried over to the final 

rule unchanged. See §§ 471.3(b) and (c). 

F. Physical and Electronic Posting 

Requirements 

1. Physical Posting Requirements 

The contract clause in the Executive 

Order requires a contractor to post the 

employee notice ‘‘in conspicuous places 

in and about its plants and offices where 

employees covered by the National 

Labor Relations Act engage in activities 

relating to the performance of the 

contract, including in all places where 

notices to employees are customarily 

posted both physically and 

electronically.’’ Sec. 2, 74 FR 6107. This 

provision from the Executive Order 

establishes a number of criteria for 

posting, including ‘‘conspicuous’’ 

posting, posting in locations where 

NRLA-covered employees work, posting 

in locations where contract-related 

activity is performed, and posting where 

employee notices are customarily 

placed. The NPRM summarized the 

physical posting criteria by stating that 

the provision establishes that a 

contractor is required to post the notice 

physically at its place of operation 

where employees are likely to see it. 74 

FR at 38491. In addition, proposed 

§ 471.2(d) provided that the Department 

will print the required employee notice 

poster and supply it to Federal 

contractors through the Federal 

contracting agency. The NPRM also 

noted the poster may be obtained from 

OLMS, whose contact information was 

provided in this subsection of the 

proposed rule, or can be downloaded 

from OLMS’s Web site, http:// 

www.olms.dol.gov. The NPRM observed 

that the Department’s printing of the 

poster and provision of it to Federal 

contractors will reduce the burden on 

those contractors to comply with the 

Executive Order and this regulation, and 

will ensure conformity and consistency 

with the Secretary’s specifications for 

the notice. Proposed § 471.2(d) also 

permitted contractors to reproduce in 

exact duplicate the poster supplied by 

the Department to satisfy their 

obligations under the Executive Order 

and this rule. The Department invited 

comment on its proposal to make 

available print and electronic format 

posters containing the employee notice. 

The Department received nine 

comments on issues related to the 

physical posting requirements. As a 

general matter, a few comments stated 

support for the requirements for 

physical posting, and a few complained 

that the posting would create workplace 

clutter. However, most comments 

requested clarification of the criteria for 

posting and the meaning of specific 

terms, including ‘‘customary’’ placement 

and ‘‘activities related to the 

performance of the contract.’’ 

The contract clause in the Executive 

Order requires covered contractors to 

post notices in ‘‘places where notices to 

employees are customarily posted.’’ 74 

FR 6107. One comment sought guidance 

on this provision, asking whether 

‘‘customary’’ postings means placement 

where the employer posts routine 

notices to employees such as general 

personnel information, or whether it 

instead means placement where the 

employer posts other legally mandated 

notices, which may be different. 

One comment suggests that the 

contract clause establishes two 

independent requirements for posting: 

First, a contractor must post the notice 

where NLRA-covered employees 

perform work related to the contract, 

and second, they must post it in all 

places where notices to employees are 

customarily posted. This comment 

suggests that the first requirement is 

separate from the second, so the notice 

must be posted where contract work is 

being performed, even if not where 

customary employee notices are posted, 

and a notice must also be posted where 

employee notices are customarily 

posted. Under this interpretation, a 

contractor must post, for example, on 

the work floor and where other notices 

are posted. In a similar vein, a second 

commenter suggests that DOL ‘‘mandate 

effective physical posting’’ because 

‘‘employees working at diverse or 

remote locations may not always pay 

attention to electronic notices but do 

take note of physical postings in their 

work areas’’ (emphasis added). 

Several commenters raised concerns 

about the application of the phrase 

‘‘activities relating to the performance of 

the contract.’’ One commenter submitted 

that the meaning of where employees 

‘‘engage in activities relating to the 

performance of the contract’’ is vague 

and unclear. Must a contractor post the 

notice, the commenter asks, in a 

location in which employees indirectly 

engage in contract activities, such as 

where employees provide some but not 

all products and/or services related to 

the contract; where employees spent 

only 20% of their work time on 

products and/or services that would 

‘‘eventually’’ be used at a second facility 

in performance of the contract; where 

the product or service was altered prior 

to fulfillment of the contract; or where 

human resources personnel work at a 

separate location by providing support 

to employees working on the contract? 

In short, the commenter posits, what 

‘‘nexus’’ must exist between an 

employee and work related to the 

performance of the contract? 

A second commenter suggests that 

posting should be required only where 

employees work directly on the 

contract. The comment argues that 

requiring employers to post where 

employees are not working directly on 

the government contract may cause 

compliance challenges and would give 

contractors ‘‘significant pause’’ before 

entering into future government 

contracts. This commenter requests 

guidance from the Department regarding 

employees that do not directly perform 

contract work but perform supportive 

work, such human resources and 

accounting employees. Similarly, a third 

comment requests clarification on 

posting where the contractor’s 

employees perform ‘‘remote tasks,’’ such 

as payroll employees at a separate 


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14Subsequent subsections of § 471.2 have been 

re-lettered following the insertion of new 

subsection (d). 

15The contract clause prescribed by Executive 

Order 13201 specified that ‘‘[d]uring the term of this 

contract, the contractor agrees to post a notice, of 

such size and in such form as the Secretary of Labor 

shall prescribe, in conspicuous places in and about 

its plants and offices, including all places where 

notices to employees are customarily posted.’’ Sec. 

2(a)(1), 66 FR 11221. Section 202 of Executive 

Order 11246 requires that ‘‘[t]he contractor agrees to 

post in conspicuous places, available to employees 

and applicants for employment, notices to be 

provided by the contracting officer setting forth the 

provisions of this nondiscrimination clause.’’ Sec. 

202(1), E.O. 11246 (available at http://www.dol.gov/ 

ofccp/regs/statutes/eo11246.htm). 

facility, or employees at a distribution 

center that sends parts to the assembly 

facility where the contract work is 

performed. This comment also proposes 

that the Department interpret the 

provision to mean work performed 

directly on the contract, thus 

eliminating ‘‘upstream’’ and 

‘‘downstream’’ employees. To the extent 

the rule covers administrative functions, 

the comment requests more specific 

guidance on how such work is ‘‘related 

to the performance of the contract.’’ 

Finally, two commenters contended 

that the rule’s posting requirements 

conflict with the Executive Order. 

Specifically, they observe that 

§ 471.10(b)(1) requires that the notice be 

posted at ‘‘each of the contractor’s 

establishments and/or construction 

work sites* * *[,]’’ which appears to be 

broader than the contract clause 

requirement to post where employees 

engage in activities related to contract 

performance. The comment 

recommends revision to regulatory text 

to state that posting is only required 

where employees engage in contract’s 

performance. 

The Department received several 

comments about the physical poster 

itself. Two comments suggested that the 

poster be printed in other languages, 

particularly Spanish. Two agree with 

the Department that in order to ensure 

that the notice is not reduced or 

otherwise modified, the poster as 

supplied by the Department cannot be 

altered in size or substance and that 

only exact duplicates of the Departmentsupplied poster can be utilized. By 

contrast, two commenters noted that 

this no-alteration requirement prevents 

contractors from purchasing the poster 

through a commercial source that 

consolidates Federally mandated 

posters into a single poster, provides 

updates to posters when the content is 

revised by the implementing agency, or 

both. 

After carefully reviewing the 

comments related to the physical 

posting requirements, the Department 

has concluded the following. The 

Executive Order requires a contractor to 

post the employee notice ‘‘in 

conspicuous places in and about its 

plants and offices[,] including all places 

where notices to employees are 

customarily posted * * * physically.’’ 

Sec. 2, para. 1, 74 FR 6107. Because the 

Department received no comments 

raising issues regarding the meaning of 

posting ‘‘in conspicuous places[,]’’ the 

Department concludes that contractors 

are accustomed to such a requirement 

and it has a well-accepted meaning. A 

notice is conspicuously posted if it is 

placed in a central location where 

employees are likely to see it. Dunham 

v. McLaughlin Body Co., 812 F. Supp 

867, 872 (DC Ill. 1992) (notice required 

under Age Discrimination in 

Employment Act). See also 29 CFR 

825.300, which requires covered 

employers to ‘‘post and keep posted’’ the 

notice required by the Family and 

Medical Leave Act (‘‘FMLA’’), 29 U.S.C. 

2601 et seq., ‘‘on its premises, in 

conspicuous places where employees 

are employed,’’ which means 

‘‘prominently where it can be readily 

seen by employees and applicants for 

employment.’’ Accordingly, for the 

purposes of this rule, a contractor meets 

the requirement to post the employee 

notice conspicuously if the notice is 

prominent and can be readily seen by 

employees. This standard has been 

incorporated into a new subsection of 

§ 471.2(d), which establishes the 

regulatory standards for a contractor’s 

physical posting of the employee 

notice.14

The requirement to post ‘‘in and about 

[a contractor’s] plants and offices * * *, 

including in all places where notices to 

employees are customarily posted[,]’’ 

when read together with the 

‘‘conspicuous’’ requirement, requires 

widespread posting that is prominent 

and readily observable throughout the 

contractor’s plants and offices, and 

emphasizes that among these locations 

is placement where other employee 

notices are posted. ‘‘Other notices to 

employees’’ is not limited to Federally 

mandated legal notices, but includes 

notices to employees regarding the 

terms and conditions of their 

employment. See § 471.2(d)(1). 

In response to comments, the 

Department has determined that it is 

necessary and appropriate to require a 

contractor that employs a significant 

number of employees who are not 

proficient in English to post the 

employee notice in languages other than 

English to achieve the purposes of the 

Order, and this requirement has been 

incorporated into § 471.2(d). In 

implementing a similar requirement 

under the FMLA, 29 CFR 825.300(a)(4), 

the Department stated that ‘‘when the 

employer employs a significant portion 

of employees who are not literate in 

English, the employer [must] provide 

the poster and general notice to 

employees in a language in which they 

are literate.’’ 73 FR 67991, Nov. 17, 

2008. The Department similarly adopts 

this standard for application in this rule, 

and will require a contractor to post the 

employee notice in a language or 

languages spoken by a significant 

portion of the contractor’s workforce. 

See § 471.2(d). Employers with multiple 

locations may post notices in different 

languages at different locations, if the 

posted notices are provided in 

languages in which the employees are 

literate at each location. The 

Department will provide necessary 

translations of the poster. See § 471.2(e). 

With regard to the requirement in 

§ 471.2(e) that the poster not be altered 

by the contractor, the Department 

clarifies that this prohibition is not 

intended to, and should not, impair the 

ability of contractors to utilize a 

commercial poster service that might 

provide the instant employee notice 

consolidated onto one poster with other 

Federally mandated labor and 

employment notices, so long as such 

consolidation does not alter the size, 

color, or content of the poster provided 

by the Department. 

Finally, the Department agrees with 

the comments that additional guidance 

is needed to advise contractors and 

employees regarding the meaning of the 

requirement to post where employees 

‘‘engage in activities relating to the 

performance of the contract.’’ 74 FR 

6107. The starting point for 

interpretation and implementation of 

this phrase is two prior executive orders 

that similarly obligated notice-posting 

through contract clause incorporation. 

Although neither Executive Order 11246 

nor 13201 included the operative phrase 

as a provision setting the outside 

bounds of the posting requirement, they 

each employed the operative phrase 

inversely to establish the basis of a 

coverage exemption.15 As a result, both 

Executive Orders 11246 and 13201 

provided that the Department may grant 

exemptions to facilities of a contractor 

that are ‘‘in all respects separate and 

distinct from activities of the contractor 

related to the performance of the 

contract.’’ See E.O. 11246, Sec. 204(d), 

as amended (available at http:// 

www.dol.gov/ofccp/regs/statutes/ 

eo11246.htm); E.O. 13201, Sec. 3(c), 66 

FR 11222–23 (emphasis added). 

In implementing the ‘‘separate and 

distinct facilities’’ exemption for 


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16These factors are found in Office of Federal 

Contractor Compliance Programs Directive, 

Separate Facility Waivers/Exemptions (Sept. 13, 

2002) (available at http://www.dol.gov/ofccp/regs/ 

compliance/directives/dir260.pdf). Other factors 

that may be considered include the number of 

facilities connected to the contractor’s Government 

contracts and the nature of the contractor’s 

contractual relationship with the Government. Id. at 

4. The Department’s implementation of now 

revoked Executive Order 13201 concluded that the 

identical factors would be used to consider requests 

for waivers for separate and distinct facilities under 

that rule. See 69 FR 16384. 

17 In addition, Proposed § 471.10(b)(1), which 

stated that compliance evaluations will determine 

whether the notice is posted ‘‘in an about each of 

the contractor’s establishments and/or construction 

worksites,’’ has been modified to reflect that 

compliance evaluations will assess conformity with 

the applicable physical and electronic posting 

standards contained in § 471.2(d) and (f). 

Executive Order 11246, the Department 

has adopted a multi-factor analysis to 

determine whether activity at a certain 

facility is separate and distinct from 

activity related to the performance of 

the contract.16 Although these 

exemption factors are facility-based, and 

are inherently intended to analyze 

whether entire facilities are contractrelated, they are nevertheless instructive 

because they suggest that indirect 

support of or benefit from the 

government contract may cause the 

denial of an exemption or waiver 

request. 

In addition to analyzing the 

implementation of the phrase as it 

operated in the two predecessor 

executive orders, the Department has 

also looked to the implementation of a 

similar phrase that affirmatively 

established the bounds of a contractor’s 

obligations without regard to the 

possibility of waivers or exemptions. 

The Department’s previous experience 

implementing Section 503 of the 

Rehabilitation Act, 29 U.S.C. 793, 

provides such an analog. Prior to a 

statutory amendment in 1992, the 

affirmative action requirements of 

Section 503 required government 

contracts in excess of $10,000 to 

‘‘contain a provision requiring that, in 

employing persons to carry out such 

contract, the party contracting with the 

United States shall take affirmative 

action to employ and advance in 

employment qualified individuals with 

disabilities.’’ 29 U.S.C. 793 (1991 

compilation) (emphasis added). 

Accordingly, the affirmative action 

provision of Section 503 applied only 

insofar as the contractor was employing 

persons to ‘‘carry out’’ or, as with 

Executive Order 13496, ‘‘engage in 

activities related to the performance of,’’ 

the government contract. The similar 

focus of these provisions is thus 

directed to the specific nature of the 

employees’ work, and is not based on 

the conduct of the work at a facility. 

To determine whether contractors 

were ‘‘employing persons to carry out’’ a 

government contract for the purposes of 

Section 503, the Department established 

a disjunctive test. 29 CFR 60– 

741.4(a)(2). Under that test, the 

Department considered a position to 

have been engaged in carrying out a 

contract if: 

(A) The duties of the position included 

work that fulfilled a contractual obligation, or 

work that was necessary to, or that 

facilitated, performance of the contract or a 

provision of the contract; or 

(B) The cost or a portion of the cost of the 

position was allowable as a cost of the 

contract under the principles set forth in the 

Federal Acquisition Regulation at 48 CFR Ch. 

1, part 31: Provided, That a position shall not 

be considered to have been covered by this 

part by virtue of this provision if the cost of 

the position was not allocable in whole or in 

part as a direct cost to any Government 

contract, and only a de minimis (less than 

2%) portion of the cost of the position was 

allocable as an indirect cost to Government 

contracts, considered as a group. 

29 CFR 60–741.4(a)(2)(A)-(B). In 

proposing this regulatory test, the 

Department explained that subsection A 

includes ‘‘work that is necessary to or 

that facilitates contract performance, 

even if not directly required by an 

express contract term, [which] is 

intended to reflect the practical reality 

that performance of a contract generally 

requires the cooperation of a variety of 

individuals engaged in auxiliary and 

related functions beyond direct 

production of the goods or provision of 

the services that are the object of the 

contract.’’ 57 FR 48092, Oct. 21, 1992. 

The Department has uniformly 

concluded in each of these prototypes— 

Executive Orders 11246 and 13201, and 

Section 503—that contract-related work 

includes more than direct work that 

effectuates that product or service that 

is the subject of the contract. Under the 

Department’s interpretations, included 

in contract-related activity is indirect or 

auxiliary work without which the 

contract could not be effectuated, such 

as maintenance, repair, personnel and 

payroll work. 

Accordingly, the Department will 

adopt the disjunctive test previously 

used for implementing the affirmative 

action requirements of Section 503 of 

the Rehabilitation Act to determine 

whether, under Executive Order 13496, 

particular employees are ‘‘engage[d] in 

activities relating to the performance of 

the contract.’’ See § 471.2(d)(2).17 In 

determining whether employees are 

engaging in activities relating to the 

performance of the contract under 

§ 471.2(d)(2)(i), the Department notes 

that a contract for production and sale 

of goods to the Government commonly 

requires the work not only of the 

production employees assembling the 

goods, but also of those engaged in 

functions such as repairing the 

machinery used in producing the goods; 

maintaining the plant; assuring quality 

control and security; storing the goods 

after production; delivering them to the 

Government; hiring, paying, and 

providing personnel services for the 

employees engaged in contract-related 

work; keeping financial and accounting 

records; performing related office and 

clerical tasks; and supervising or 

managing the employees engaged in 

such tasks. This list is not intended to 

be exhaustive, but only to illustrate that 

a variety of functions may commonly be 

involved in activities related to the 

performance of the contract. Whether a 

particular employee is engaged in 

activities related to the performance of 

the contract depends on the facts. In 

each case, the question is whether the 

duties of the employee’s position 

include work that contributes to or 

furthers the performance of the contract, 

or work whose omission would impede 

the contract’s performance. 

2. Electronic Posting Requirements 

The NPRM stated that those 

contractors that customarily post notices 

to employees electronically must also 

post the required notice electronically. 

In proposed § 471.2(e), the Department 

indicated that such contractors may 

satisfy the electronic posting 

requirement on any Web site that is 

maintained by the contractor or 

subcontractor and customarily used for 

employee notices, whether external or 

internal. The NPRM noted that a 

contractor must display prominently on 

its Web page or electronic site where 

other employee notices are customarily 

placed a link to the DOL’s Web page 

that contains the full text of the 

employee notice. The contractor must 

also place the link in the prescribed text 

contained in § 471.2(e). The prescribed 

text is the introductory language of the 

notice. The Department sought 

comments on this proposal for 

electronic compliance, and particularly 

requested feedback regarding whether it 

should prescribe standards regarding 

the size, clarity, location, and brightness 

with regard to the link, including how 

to prescribe electronic postings that are 

at least as large, clear and conspicuous 

as the contractor’s other posters. 

The Department received numerous 

comments about the electronic posting 

requirements of the rule. About half of 

those comments sought additional 


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guidance on the meaning of particular 

terms used in the rule that establish the 

electronic posting requirement, and the 

other half commented on the text 

prescribed to accompany the electronic 

link to the notice. In addition, the 

Department received one comment 

responding particularly to whether the 

Department should adopt standards 

regarding display of the link. Finally, 

one comment challenged the 

requirement to post electronically as 

unnecessary, redundant and ultimately 

burdensome because, the commenter 

submitted, most employees are 

accustomed to finding notices on 

employee bulletin boards. This 

comment also suggested that posting 

this notice electronically, when other 

Federally mandated notices are required 

to be posted only physically, heightens 

the impact of this notice and suggests 

that it may have priority over other 

required notices. The comment suggests 

that this outcome is not supported by 

the requirements of the Executive Order. 

Two comments suggested additional 

limitations on the meaning of 

‘‘customarily post[ing] notices to 

employees electronically,’’ which is the 

threshold standard that triggers the 

obligation to post this notice 

electronically as well. The first 

comment applauds the use of electronic 

notification to employees, but suggests 

that the requirement to post 

electronically be limited to those cases 

in which the employer posts only other 

Federally mandated notices 

electronically. The comment suggests 

that employers may post a variety of 

notices to employees electronically, and 

the mere use of electronic 

communications would trigger the eposting requirement for this notice. The 

second comment suggests that in those 

cases in which an employer posts 

notices to employees both physically 

and electronically, the rule should be 

modified to give employers the option 

to post only physically. The comment 

supports the optional requirement with 

the example of firms that engage in 

manufacturing that may post some 

notices electronically. The most 

effective way to reach the employees 

engaged in the manufacturing process, 

the comment contends, is to physically 

post notices on the shop floor. This 

comment suggests the electronic posting 

in such instances would be needless 

and burdensome, and defeat the intent 

of the Executive Order. The comment 

suggests that the requirement to post 

electronically be limited to those cases 

in which employees engaged in 

activities related to the contract have 

regular access to electronic postings and 

access to electronic postings may be 

limited to employees engaged in 

activities related to the contract. 

Three comments sought clarification 

of the requirement to ‘‘display 

prominently’’ the link to the 

Department’s Web site containing the 

full text of the notice. The first comment 

suggests that many employers have 

intranet sites that are devoted entirely to 

communication with employees, and 

absent further guidance on prominent 

display, such employers will be 

uncertain where on those sites to 

include the link to the required notice. 

One labor organization suggested that 

placement of the link be required 

‘‘immediately’’ on any page referencing 

employee notices so that successive 

clicks are avoided. A second labor 

organization suggested that the rule 

require the link to be no less prominent 

than the employer’s display of other 

comparable notices. Finally, in response 

to the Department’s specific query 

regarding whether it should prescribe 

standards regarding the size, clarity, 

location and brightness of the link, one 

commenter responded negatively, 

arguing that such regulation would be 

‘‘intrusive, overreaching and overregulating.’’ Instead of assuming that 

contractors may try to minimize the 

link, the comment suggested that the 

Department simply require that the link 

be displayed in the same size and clarity 

as other information on the employer’s 

Web site. 

The Department received six 

comments on the text required to be 

included with the link to the notice, and 

because the prescribed text is identical 

to the preamble of the notice, the 

comments were analogous to comments 

discussed earlier about the text of the 

preamble—some favored the statement 

regarding encouraging collective 

bargaining and some opposed it. In 

addition to comments about the content 

of the text, two commenters objected to 

the length of the prescribed text, one 

suggesting that it is cumbersome and 

impractical and the other suggesting 

that the prescribed text simply state, 

‘‘Your Rights Under the National Labor 

Relations Act.’’ Two labor organizations 

favored the inclusion of the prescribed 

text, and suggested that it include the 

heading, ‘‘Important notice of Your 

Federal Rights with Regard to Collective 

Bargaining.’’ 

After full consideration of the 

comments about the rule’s electronic 

posting requirements, the Department 

has made the following decisions. The 

Executive Order requires posting in ‘‘all 

places where notices to employees are 

customarily posted both physically and 

electronically.’’ Sec. 2, para. 1, 74 FR 

6107 (emphasis added). Thus, the Order 

indicates that the physical and 

electronic posting requirements are 

simultaneous, and one cannot be used 

in lieu of, or as a substitute for, the 

other. Accordingly, if an employer 

customarily posts employee notices 

both physically and electronically, it 

must post this notice both physically 

and electronically. As with the physical 

posting requirements, the Department 

concludes that a contractor ‘‘customarily 

posts employee notices electronically’’ 

within the meaning of the rule when the 

contractor posts messages to employees 

electronically about the terms and 

conditions of their employment, and 

such messages are not limited to 

Federally mandated communications 

and employee rights. Thus, a contractor 

must post this notice electronically in 

those places that it customarily posts 

electronically other messages to 

employees about the terms and 

conditions of their employment. 

Further, inherent in the concept of a 

contractor’s ‘‘customary’’ electronic 

posting is employee access to those 

communications. Presumably, a 

contractor would not electronically post 

notices to employees about the terms 

and conditions of their employment if 

its employees did not have regular 

access to those notices. Therefore, the 

Department need not at this time 

provide guidance or set standards 

regarding employee access to electronic 

postings. 

The Executive Order’s requirement to 

post ‘‘conspicuously’’ was interpreted in 

proposed § 471.2(e) of the NPRM as 

requiring the ‘‘prominent display’’ of the 

link to the Department’s Web site, and 

comments reflected uncertainty 

regarding the meaning of this provision. 

In particular, as noted in the comments, 

large contractors may have entire 

intranets that are available for 

communication to employees. Other 

contractors may maintain a Web site on 

which notices to employees are not 

consolidated into one location. Until 

compliance experience is further 

developed, the Department will not 

adopt a standard for ‘‘prominent 

display’’ that precisely regulates the 

location of electronic notice by a set 

number of successive ‘‘clicks’’ away 

from a starting page, as suggested in 

some comments. Instead, the 

Department will consider that the 

electronic notice is displayed 

prominently if the link to the 

Department’s Web site containing the 

notice is no less prominent than the 

contractor’s other notices to employees. 

In addition, at this time the Department 

will not set regulatory standards 


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18Under the NLRA, the term ‘‘employer’’ excludes 

the United States, any wholly owned Government 

corporation, any Federal Reserve Bank, any State or 

political subdivision thereof, any person subject to 

the Railway Labor Act [45 U.S.C. 151 et seq.], any 

labor organization (other than when acting as an 

employer), or anyone acting in the capacity of 

officer or agent of such labor organization. 29 U.S.C. 

152(2). Section 471.4(a)(3) of the NPRM contained 

an inadvertent drafting error, which combined two 

employer exclusions into one subparagraph. The 

two exclusions—any State or political subdivision 

of a State and any person subject to the Railway 

Labor Act—have been listed in separate 

subparagraphs in the final rule, thus increasing by 

one the number of employer exclusions listed in 

§ 471.4(a). 

The NLRA’s definition of ‘‘employee’’ also 

excludes those employed as agricultural laborers, in 

the domestic service of any person or family in a 

home, by a parent or spouse, as an independent 

contractor, as a supervisor, or by an employer 

subject to the Railway Labor Act, such as railroads 

and airlines. 29 U.S.C. 152(3). Section 471.4(b) has 

been modified to include the NLRA’s catchall 

definition of excluded employees, i.e., someone 

who is employed ‘‘by any other person who is not 

an employer as defined’’ in the NLRA. 29 USC 

152(3). 

regarding the clarity or brightness of the 

link to the Department’s Web site. 

Further, in response to comments and 

for a variety of reasons, including 

limitations on space available for 

electronic notices, the Department has 

eliminated the requirement to include 

text specified in proposed Appendix B 

with the link to the Department’s Web 

site containing the employee notice. 

Instead, the link to the Department’s 

Web site must read, ‘‘Important Notice 

about Employee Rights to Organize and 

Bargain Collectively with Their 

Employers,’’ and this requirement has 

been included with the other 

requirements for electronic posting in 

§ 471.2(f). 

Finally, as with the requirement to 

post translations of the physical 

employee notice, where a significant 

portion of a contractor’s workforce is 

not proficient in English, the contractor 

must provide the required electronic 

notice in the language the employees 

speak. This requirement will be satisfied 

by prominent display, as required in 

§ 471.2(f), of a link to the Department of 

Labor’s Web site that contains the full 

text of the poster in the language or 

languages the employees speak. In such 

cases, the Office of Labor-Management 

Standards will provide translations of 

the link to the Department’s Web site 

that must be displayed on the 

contractor’s or subcontractor’s Web site. 

G. Application of the Rule to Employers 

of ‘‘Employees Covered by the NLRA’’ 

Proposed § 471.4 implemented the 

policy noted above that the Executive 

Order requires notice-posting in those 

workplaces in which employees covered 

by the NLRA perform work related to 

the Federal contract. Thus, § 471.4 of 

the proposed regulatory text established 

coverage of the rule that is coterminous 

with NLRA coverage, and stated that the 

rule did not apply to employers 

excluded from the definition of 

‘‘employer’’ in the NLRA, 29 U.S.C. 

152(2), and employers of employees 

excluded from the definition of 

‘‘employee’’ under the NLRA, 29 U.S.C. 

152(3).18

One commenter agreed with proposed 

§ 471.4 as a starting point, but suggested 

that the rule must clarify several points 

with respect to NLRA coverage. First, 

the comment suggests that the rule 

should state that it does not apply to 

contractors without employees. Second, 

the comment suggests that the rule 

should exempt employers that do not 

fall within the NLRB’s discretionary 

jurisdictional standards related to the 

volume and character of the business 

done by the employer. Third, the 

comment states that the rule should 

indicate that the Board’s jurisdiction 

does not extend to some employers, 

such as religious school and tribal 

enterprises. A second comment agrees 

that the Department should state that 

employers who are not covered by the 

Board’s discretionary jurisdictional 

standards, or are exempted from 

coverage for other reasons, such as 

certain religious educational institutions 

or the horse-racing industry, should be 

expressly excluded from the rule’s 

application. Two comments raised the 

issue of application of the rule to foreign 

operations. The first comment urges the 

exemption of posting requirements for 

[presumably U.S. firms with] 

‘‘employees performing work outside of 

the United States’’ because ‘‘the nations 

in which our companies operate 

overseas have labor management 

requirements of their own.’’ The second 

comment raises the concern that 

requiring notice-posting ‘‘in foreign 

contracts and subcontracts would be 

confusing to employees working abroad 

who would not be subject to the 

statute.’’ This comment notes that 

OFCCP has incorporated a similar 

exclusion in its regulations at 41 CFR 

60–1.5(a)(3), and suggests a similar 

exemption for work performed on 

contracts and subcontracts outside the 

U.S. 

As noted, Section 2 of the Executive 

Order requires contractors to post the 

required notice ‘‘where employees 

covered by the National Labor Relations 

Act’’ perform contract-related activities. 

The NLRA applies to employers and 

employees that are not excluded from 

coverage under the definitions of those 

terms in the Act. 29 U.S.C. 152(2)–(3). 

Section 10(a) of the Act empowers the 

Board ‘‘to prevent any person from 

engaging in any unfair labor practice 

affecting commerce,’’ and § 9 of the Act 

extends the jurisdiction to 

representation cases where commerce 

would be affected. 29 U.S.C. 160(a), 159. 

Sections 2(6) and 2(7) provide statutory 

definitions of ‘‘commerce’’ and ‘‘affecting 

commerce.’’ 29 U.S.C. 152(6), (7). 

The Supreme Court has determined 

that Congress granted the Board with 

‘‘the fullest jurisdictional breadth 

constitutionally permissible under the 

Commerce Clause.’’ NLRB v. Reliance 

Fuel Corp., 371 U.S. 224, 226 (1963). 

Although the NLRA’s statutory 

jurisdiction is coextensive with 

congressional power to legislate under 

the Commerce Clause, the Board has 

established discretionary standards that 

limit the assertion of its broad statutory 

authority to those cases which, in its 

opinion, have a substantial effect on 

commerce. These discretionary 

standards are based on the volume and 

character of the business done by the 

employer. See ‘‘An Outline of Law and 

Procedure in Representation Cases,’’ 

Chapter 1, Jurisdiction (August 2008) 

(available at http://www.nlrb.gov/nlrb/ 

legal/manuals/outline_chap1.html). 

However, even where an employer fails 

to meet the appropriate discretionary 

monetary standard, the Board will assert 

its jurisdiction to the extent necessary to 

address alleged violations of Section 

8(a)(4), which prohibits retaliation 

against employees who give testimony 

or file charges under the Act, if it can 

be established that the Board has 

statutory jurisdiction, i.e., a greater than 

de minimis flow of goods or services 

across State lines. Pickle Bill’s, Inc., 224 

NLRB 413 (1976). 

After due consideration, the 

Department declines to limit the 

application of the notice-posting 

requirements based on the Board’s 

discretionary jurisdictional standards 

for the following reasons. First, had the 

President wanted the application of the 

rule to be limited in such a fashion, the 

words of the Executive Order would 

create such a limitation, but no such 

text appears in the Order. Second, the 

Board’s discretionary jurisdictional 

standards were established to better 

effectuate the purposes of the Act to 

‘‘promote the prompt handling of major 

cases’’ by limiting the exercise of its 

jurisdiction ‘‘to enterprises whose 

operations have, or at which labor 

disputes would have, a pronounced 

impact upon the flow of interstate 

commerce.’’ Hollow Tree Lumber 

Company, 91 NLRB 635, 636 (1950). 

The application of the notice-posting 


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19As one comment notes, the Board has declined 

completely to exercise jurisdiction over the 

horseracing and dogracing industries because they 

are peculiarly related to, and regulated by, local 

governments, and because further regulation of 

them would not contribute to stability in labor 

relations in those industries. See 29 CFR 103.3. 

Because the Board has expressly found that its 

jurisdiction would not enhance labor-management 

stability in those industries, and because the 

purpose of this rule is to promote labor peace and 

reduce labor unrest, the Department will follow this 

jurisdictional standard and not apply the rule to the 

horseracing or dogracing industries. 

rule to employers outside the Board’s 

discretionary jurisdictional limits raise 

no similar concerns related to the 

prompt handling of major unfair labor 

practice or representation cases, and 

thus no similar rationale demands the 

inclusion of such a limitation. Third, 

the Board’s discretionary jurisdictional 

standards are numerous and unwieldy 

for the purposes of this rule. The 

jurisdictional standards that have the 

broadest application are those for retail 

and non-retail operations, but the Board 

has established numerous separate 

individual standards to address certain 

industries and types of enterprises, 

including health care organizations, 

newspapers, and educational 

institutions, among others. See ‘‘An 

Outline of Law and Procedure in 

Representation Cases,’’ supra, Chapter 1, 

Jurisdiction (discussing jurisdictional 

standards applicable by industry). 

Finally, as illustrated in Pickle Bill’s, 

Inc., supra, 224 NLRB at 413, certain 

public policies, such as remedying an 

employer’s unlawful interference with 

the statutory right of all employees 

freely to resort to and participate in the 

Board’s processes, demand that the 

Board’s discretionary jurisdictional 

standards not apply. The Department 

likewise concludes that the public 

policy underlying this rule favoring 

notification to employees of their rights 

similarly demands that the Board’s 

discretionary jurisdictional standards 

not apply. Therefore, the Department 

has determined that the rule applies to 

employers of ‘‘employees covered by the 

National Labor Relations Act,’’ Sec. 2, 74 

FR at 6107, without regard to the 

Board’s discretionary jurisdictional 

limitations.19

These comments also raise the issue 

of the application of the rule to certain 

contractors that might implicate the 

First Amendment, such as religiously 

affiliated employers. See NLRB v. 

Catholic Bishop of Chicago, 440 U.S. 

490 (1979) (reading the NLRA in light of 

the Religion Clauses of the First 

Amendment, NLRB lacks jurisdiction 

over church-operated schools). Because 

such limits to the NLRA’s jurisdiction 

are constitutional in nature and 

similarly implicate the Department’s 

action under the Executive Order with 

respect to such contractors, the rule will 

not apply to contractors that hold 

themselves out to the public as a 

religious institution, that are nonprofit, 

and are religiously affiliated. See 

University of Great Falls v. NLRB, 278 

F.3d 1335 (DC Cir. 2002) (employing 

three-part test for implementing 

Catholic Bishop); Universidad Central 

de Bayamon v. NLRB, 793 F.2d 383 (1st 

Cir. 1985) (en banc) (Breyer, Circuit 

Judge) (same). 

As noted, the comments also raise the 

issue of the application of the rule to 

U.S. firms doing business abroad. The 

Supreme Court has stated that the 

statutory jurisdiction of the NLRA 

extends only to employees ‘‘of our own 

country and its possessions.’’ Benz v. 

Compania Naviera Hidalgo, S.A., 353 

U.S. 138, 144 (1957). More precisely, the 

Act only applies to employees in the 

territorial United States, and not to 

American employees located abroad. 

See, e.g., RCA Oms, 202 NLRB 228 

(1973); Range Sys’s. Eng’g Support, 326 

NLRB 1047 (1998); Computer Sci.’s 

Raytheon, 318 NLRB 966 (1995); GTE 

Automatic Elec. Inc., 226 NLRB 1222 

(1976). Similarly, the regulations 

implementing Executive Order 11246 

exempt from coverage ‘‘work performed 

outside the United States by employees 

who were not recruited within the 

United States.’’ 41 CFR. 60–1.5(a)(3). For 

these reasons, the Department has 

determined that this rule will not apply 

to government contracts for work 

performed exclusively by employees of 

U.S. firms operating outside the 

territorial United States, and 

§ 471.3(a)(5) has been added to reflect 

this determination. 

Finally, the comments raise the issue 

regarding the application of the rule to 

tribal governments. The NLRA is a 

statute of general applicability, and 

therefore may be applicable to the 

activities of Indian tribes. NLRB v. 

Chapa-De Indian Health Program Inc., 

316 F.3d 995 (9th Cir. 2003). The 

Board’s standard for determining the 

circumstances under which it will 

exercise jurisdiction over Indian-owned 

and -operated enterprises is based on 

the nature of the enterprise and not its 

location. San Manuel Indian Bingo & 

Casino, 341 NLRB 1055 (2004). In San 

Manuel, the Board overruled prior 

precedent and applied the statute to the 

conduct of Indian tribes, unless the law 

touches the exclusive rights of selfgovernment in purely intramural 

matters, the application of the law 

would abrogate treaty rights, or there is 

evidence in the statute or legislative 

history that Congress did not intend the 

law to apply to Indian tribes. Id. The 

Department will utilize the same 

standard, and apply this rule to Federal 

contractors that are Indian-owned or 

-operated enterprises, unless one of the 

exceptions articulated by the Board in 

San Manuel applies. 

Subpart B—General Enforcement; 

Compliance Review and Complaint 

Procedures 

Subpart B of the proposed rule 

established standards and procedures 

the Department will use to determine 

compliance with obligations of the rule, 

take complaints regarding 

noncompliance, address findings of 

violations, provide hearings for certain 

matters, impose sanctions, including 

debarment, and provide for 

reinstatement in the case of debarment. 

The standards and procedures proposed 

in the NPRM were taken largely from 

the Department’s prior rule 

administering and enforcing Executive 

Order 13201, 66 FR 11221. See 29 CFR 

Part 470 (2008), rescinded under 

authority of E.O. 13496, 74 FR 14045, 

March 30, 2009. The Department invited 

comment on the administrative and 

enforcement procedures proposed in 

Subpart B. 

The NPRM noted that OFCCP 

administers and enforces several laws 

that ban discrimination and require 

Federal contractors and subcontractors 

to take affirmative action to ensure that 

all individuals have an equal 

opportunity for employment. Therefore, 

OFCCP already has responsibility for 

monitoring, evaluating and ensuring 

that contractors doing business with the 

Federal government conduct themselves 

in a manner that complies with certain 

Federal laws. Proposed § 471.10 built on 

this practice and expertise, and 

established authority in the Director of 

OFCCP to conduct evaluations to 

determine whether a contractor is in 

compliance with the requirements of 

this rule. Under proposed § 471.10(a), 

such evaluations may be done solely for 

the purpose of assessing compliance 

with this rule, or may be undertaken in 

conjunction with an assessment of a 

Federal contractors’ compliance with 

other laws under OFCCP’s jurisdiction. 

This proposed section also established 

standards regarding location of the 

posted notice that will be used by 

OFCCP to assess compliance and 

indicates that an evaluation record will 

reflect efforts made toward conciliation, 

corrective action and/or 

recommendations regarding 

enforcement actions. 

The Department received three 

comments that each raised concerns 

about OFCCP evaluations to determine 


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whether a contractor is in compliance 

with the contract clause-inclusion and 

notice-posting requirements of the rule. 

The thrust of these comments is that 

OFFCP compliance evaluators do not 

have substantive expertise about the 

rights and obligations contained in the 

NLRA, and therefore should not be 

permitted to dispense advice to 

employees regarding those rights and 

obligations during compliance reviews. 

One comment noted that employees are 

likely to be confused by OFCCP’s role in 

implementing the rule, because the 

NLRB has enforcement authority 

regarding the rights stated in the notice. 

A second commenter noted that the 

Department should delegate authority 

for compliance to the NLRB, since it has 

the proper enforcement authority. Two 

commenters noted that the Department 

must ensure that OFCCP compliance 

evaluators refer any questions regarding 

substantive rights and obligations under 

the NLRA to the NLRB. In response to 

these concerns, the Department notes 

that the purpose of an OFCCP 

compliance evaluation is to determine 

whether a contractor is in compliance 

with the requirements of this rule, in 

particular, whether the contractor has 

satisfied the notice-posting and contract 

clause-inclusion requirements 

applicable to that contractor. To the 

extent that questions are raised 

regarding the substantive provisions of 

the notice during a compliance 

evaluation, the OFCCP reviewer will 

refer such questions to the NLRB. 

Therefore, no change to the proposed 

§ 471.10 is required. 

Proposed § 471.11 provided for the 

Department’s acceptance of written 

complaints alleging that a contractor 

doing business with the Federal 

government has failed to post the notice 

required by this rule. The proposed 

section established that no special 

complaint form is required, but that 

complaints must be in writing. In 

addition, as proposed in § 471.11, 

written complaints must contain certain 

information, including the name, 

address and telephone number of the 

person submitting the complaint, and 

the name and address of the Federal 

contractor alleged to have violated this 

rule. This proposed section established 

that written complaints may be 

submitted either to OFCCP or OLMS, 

and the contact information for each 

agency was contained in this 

subsection. Finally, proposed § 471.11 

established that OFCCP will conduct 

investigations of complaints submitted 

under this section, make compliance 

findings based on such investigations, 

and include in the investigation record 

any efforts made toward conciliation, 

corrective action, and recommended 

enforcement action. 

The Department received one 

comment regarding the ‘‘informality’’ of 

the complaint submission process. The 

comment suggests that because the 

complaint is not required to be 

submitted under penalty of perjury or 

similar standard, the process permits 

the filing of false complaints for 

harassment or other wrongful purposes. 

Unlike most other complaints alleging 

an employer’s violation of a legal 

obligation, however, a complaint filed 

under § 471.11 requires only a 

straightforward allegation that an 

employer has not posted the required 

notice physically and/or electronically, 

or has not included the contract clause 

in its covered contracts or subcontracts. 

Once notified that such a complaint has 

been received, the alleged violation is 

either easily remedied or easily 

disproved, providing virtually no 

opportunity for harassment or other 

misuse of the complaint process. In 

addition, because the factual basis 

underlying a complaint is easily 

corrected, an employee who files a true 

complaint may be vulnerable to 

retaliation by an employer who quickly 

corrects the violation and then subjects 

the complaining employee to 

repercussions that may result from a 

penalty-of-perjury standard. Finally, the 

complaint process for the Department’s 

former and now-revoked employee 

notice rule, 29 CFR 470.11 (2008) was 

identical to this process. For these 

reasons, the Department has decided to 

retain the complaint process as 

proposed in the NPRM. See § 471.11. 

Proposed § 471.12 set out the initial 

steps that the Department will take in 

the event that a contractor is found to 

be in violation of this rule, including 

making reasonable efforts to secure 

compliance through conciliation. Under 

this proposed section, a noncompliant 

contractor must take action to correct 

the violation and commit in writing to 

maintain compliance in the future. If the 

contractor fails to come into 

compliance, OLMS may proceed with 

enforcement efforts proposed in 

§ 471.13. 

One comment regarding the 

conciliation process requested that the 

Department clarify the extent of a 

contractor’s liability for penalties if the 

contractor has fully cooperated with 

reasonable conciliation effort and 

complies with the requirements of the 

rule. The same comment suggests that a 

contractor be given notice of the 

conciliation process and an opportunity 

to appear at that stage before the 

Director for Federal Contract 

Compliance, and that if compliance 

results, a written decision be issued to 

that effect. 

The comment misconstrues the 

conciliation and enforcement processes 

of the rule. Enforcement proceedings 

against a contractor, discussed further 

below, will result when a violation has 

not been corrected through conciliation. 

§ 471.13(a)(2). If, during the conciliation 

process, a contractor comes into full 

compliance with the requirements of the 

rule and commits in writing not to 

repeat the violation, § 471.12(b), there is 

no need to refer the matter for 

enforcement, and no attendant penalties 

can result. Similarly, because of the 

informality of the conciliation process 

and the absence of any penalties 

associated with it, there is no basis to 

provide a contractor with formal notice, 

an opportunity to be heard, or a 

decision on the record at that stage of 

the process. 

Proposed § 471.13 implemented 

Section 6 of the Executive Order, 74 FR 

6108–09, and established steps that the 

Department will take in the event that 

conciliation efforts fail to bring a 

contractor into compliance with this 

rule. Under this proposed section, 

enforcement proceedings may be 

initiated if violations are found as a 

result of either a compliance evaluation 

or a complaint investigation, or in those 

cases in which a contractor refuses to 

allow a compliance evaluation or 

complaint investigation or refuses to 

cooperate with the compliance 

evaluation or complaint investigation, 

including failing to provide information 

sought during those procedures. The 

enforcement procedures proposed in 

§ 471.13 relied primarily on the 

Department’s regulations at 29 CFR part 

18, which govern administrative 

hearings before an Administrative Law 

Judge (‘‘ALJ’’), and on the provisions for 

expedited hearings at 29 CFR 18.42. The 

procedures in this proposed section 

established that an ALJ will make 

recommended findings and conclusions 

regarding any alleged violation to the 

Assistant Secretary for Employment 

Standards (‘‘Assistant Secretary’’), who 

would issue a final administrative order. 

The final administrative order may 

include a cease-and-desist order or other 

appropriate remedies in the event that a 

violation is found. The procedures in 

this proposed section also established 

timetables for submitting exceptions to 

the ALJ’s recommended order to the 

Assistant Secretary, and also provided 

for the use of expedited proceedings. 

Other than the substitution of the 

Administrative Review Board for the 

Assistant Secretary, as noted earlier, no 

changes were made to proposed 


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§ 471.13, and it is unchanged in the 

final rule. 

Proposed § 471.14 addressed the 

imposition of sanctions and penalties in 

cases in which violations are found, and 

established post-hearing procedures 

related to such sanctions or penalties. 

Section 7 of the Executive Order 

provides the framework for the scope 

and nature of remedies the Department 

may order in the event of a violation. 74 

FR 6109. 

Section 7(a) of the Executive Order 

provides that the Secretary may issue a 

directive that the contracting 

department or agency cancel, terminate, 

suspend, or cause to be cancelled, 

terminated or suspended any contract or 

portion of a contract for noncompliance. 

Id. In addition, the Executive Order 

indicates that contracts may be 

cancelled, terminated or suspended 

absolutely, or their continuance may be 

conditioned on a requirement for future 

compliance. Id. Prior to issuing such a 

directive, the Secretary must offer the 

head of the contracting department or 

agency an opportunity to object in 

writing to the remedy contemplated, 

and the objections must contain reasons 

why the contract is essential to the 

agency’s mission. Id. Finally, Section 7 

of the Executive Order prevents the 

imposition of such a remedy if the head 

of the contracting department or agency, 

or his or her designee, continues to 

object to the issuance of the directive. 

Id. Proposed § 471.14(a), (b), (c), and 

(d)(1) fully implemented the standards 

and procedures established in Section 

7(a) of the Executive Order. 

Section 7(b) of the Executive Order 

provides that the Secretary may issue an 

order debarring noncompliant 

contractors ‘‘until such contractor has 

satisfied the Secretary that such 

contractor has complied with and will 

carry out the provisions of the order.’’ 74 

FR 6109. As with the remedies 

discussed above, prior to the imposition 

of debarment, the Secretary must offer 

the head of the contracting department 

or agency an opportunity to object in 

writing to debarment, and the objections 

must contain reasons why the contract 

is essential to the agency’s mission. Id. 

Finally, Section 7(b) of the Executive 

Order prevents the imposition of 

debarment if the head of the contracting 

department or agency, or his or her 

designee, continues to object to it. Id. 

Proposed § 471.14(d)(3) of the rule 

established the availability of the 

debarment remedy. Section 471.14(f) of 

the proposed rule indicated that the 

Assistant Secretary will periodically 

publish and distribute the names of 

contractors or subcontractors that have 

been debarred for noncompliance. Other 

than the substitution of the Director of 

OLMS for the Assistant Secretary, as 

noted earlier, no changes were made to 

proposed § 471.14, and it is unchanged 

in the final rule. 

Proposed § 471.15 permitted a 

contractor or subcontractor to seek a 

hearing before the Assistant Secretary 

before the imposition of any of the 

remedies outlined above. Other than the 

substitution of the Director of OLMS for 

the Assistant Secretary, as noted earlier, 

no changes were made to proposed 

§ 471.15, and it is unchanged in the 

final rule. Proposed § 471.16 provides 

contractors or subcontractors that have 

been debarred under this rule an 

opportunity to seek reinstatement by 

requesting such in a letter to the 

Assistant Secretary. Under this 

proposed provision, the Assistant 

Secretary may reinstate the debarred 

contractor or subcontractor if he or she 

finds that the contractor or 

subcontractor has come into compliance 

with this rule and has shown that it will 

fully comply in the future. 

As noted above, § 471.2(a) required all 

nonexempt prime contractors and 

subcontractors to include the employee 

notice contract clause in each of its 

nonexempt subcontracts so that the 

obligation to notify employees of their 

rights is binding upon each successive 

subcontractor. Regarding enforcement of 

the requirements of the rule as to 

subcontractors, the Executive Order 

requires the contractor to ‘‘take such 

action with respect to any such 

subcontract as may be directed by the 

Secretary of Labor as a means of 

enforcing such provisions, including 

sanctions for noncompliance.’’ Sec. 2, 

para. 4, 74 FR 6108. Accordingly, in the 

event that the Department determines 

that a subcontractor is out of 

compliance with the requirements of 

this rule regarding employee notice or 

inclusion of the contract clause in the 

subcontractor’s own subcontracts, the 

Secretary may direct the contractor to 

require the noncompliant subcontractor 

to come into compliance. As indicated 

in the Executive Order, if such a 

directive causes the contractor to 

become involved in litigation with the 

subcontractor, the contractor may 

request the United States to enter the 

litigation in order to protect the interests 

of the United States. Sec. 2, para. 4, 74 

FR 6108. If the contractor is unable to 

compel subcontractor compliance on its 

own accord, the compliance review, 

complaint, investigation, conciliation, 

hearing and decision procedures 

established in §§ 471.10 through 471.16 

to assess and resolve contractor 

compliance with the requirements of 

this rule are also applicable to 

subcontractors. In those instances in 

which a contractor fails to take the 

action directed by the Secretary 

regarding a subcontractor’s 

noncompliance, the contractor may be 

subject to the same enforcement and 

remedial procedures that apply to 

noncompliance with requirements to 

provide employee notice or include the 

contract clause in its contracts. See 

§ 471.13(a)(1). 

The Department received a number of 

comments regarding the enforcement 

procedures of the rule, the vast majority 

of which raised concerns regarding the 

Department’s purported enforcement of 

the substantive provisions of the notice. 

Eight comments raised the issue with 

respect to the second paragraph of the 

contract clause, which states that the 

‘‘contractor will comply with all 

provisions of the Secretary’s notice, and 

related rules, regulations, and orders of 

the Secretary of Labor.’’ 74 FR 6107. 

These comments note that this 

provision, when taken together with the 

rule’s enforcement procedures, suggest 

that the Department will be adjudicating 

violations of the substantive provisions 

of the notice, which they correctly 

indicate is solely within the purview of 

the National Labor Relations Board. 

Other commenters raise the same issue 

more generically, and suggest that the 

Department’s enforcement against 

contractors that violate the Department’s 

rule interferes with the NLRB’s 

exclusive jurisdiction. Overall, the 

comments indicate that the 

Department’s interference with the 

NLRB’s adjudicatory role would violate 

principles of preemption and primary 

jurisdiction, and incorrectly impose 

sanctions precluded by the NLRA. 

In response to these comments, the 

Department assures the contractor 

community that it cannot, nor will it, 

attempt to enforce the substantive 

provisions of the notice against 

contractors or subcontractors. As the 

comments correctly note, such 

enforcement authority is within the 

exclusive jurisdiction of the National 

Labor Relations Board. The primary 

purpose of the Executive Order is to 

reduce the government’s contracting 

costs by ensuring that employees are 

well-informed of their rights under the 

NLRA. 74 FR 6107. The mechanism by 

which the Executive Order achieves this 

goal is through requiring that a 

contractor agree in the government 

contract to post a notice, developed by 

the Department, to its employees about 

those rights. The grant of enforcement 

authority to the Department in Sections 

6 and 7 of the Executive Order is 

limited, and the Order sanctions the 

Department’s enforcement activity only 


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as to a contractor’s compliance with the 

contract clause-inclusion requirements 

and the notice-posting requirements of 

this final rule. The Department does not 

construe the second paragraph of the 

contract clause as establishing an 

independent basis of authority for the 

enforcement of the substantive 

provisions of the notice. Of course, the 

substantive provisions of the notice are 

an accurate reflection of NLRA law. As 

a result, if a contractor is failing or 

refusing to comply with those 

provisions, the contractor may be in 

violation of the NLRA, and in that case 

charges may be lodged solely with and 

adjudicated solely by the NLRB. 

Beyond questions related to alleged 

overlapping jurisdiction, comments 

regarding enforcement of the rule made 

general observations and consisted of 

some requests for clarification. Two 

commenters submitted general support 

for the administrative and enforcement 

procedures of the rule. One comment 

indicated that these same enforcement 

procedures worked well in 

implementing the now-revoked 

Executive Order 13201, and urged the 

Department to similarly emphasize 

compliance assistance rather than 

‘‘heavy-handed enforcement.’’ One 

commenter described the available 

sanctions, particularly debarment, as 

‘‘unduly extreme,’’ and is concerned that 

a contractor might face such sanctions 

in the event of an unintentional or 

inadvertent violation, such as when a 

notice has fallen off the wall. Another 

comment requested more guidance on 

reinstatement from debarment under 

§ 471.16, including the steps a 

contractor must take to seek 

reinstatement and the requirement of a 

written decision on the request. This 

comment offers as an example the 

reinstatement procedures established in 

41 CFR 60–1.31. Another comment 

requests that the Department clarify that 

a contractor has no affirmative 

obligation to compel a subcontractor’s 

compliance with the rule, and that a 

contractor can only be compelled to 

itself comply. This comment suggests 

that it is unrealistic of the Department 

to require that contractors police their 

subcontractors for compliance, and that 

the Department should take 

enforcement action directly against a 

subcontractor in the event of the 

subcontractor’s noncompliance. The 

final comment regarding enforcement 

suggests that the rule must be revised to 

reflect the Department’s elimination of 

the Employment Standards 

Administration and the abolition of the 

position of Assistant Secretary for 

Employment Standards, which, as 

previously noted, has been done. 

In response to these comments, the 

Department notes that contractors will 

not receive harsh sanctions for 

inadvertent or unintentional violations 

of the rule. Indeed, the primary purpose 

of the conciliation procedures is to seek 

a contractor’s cooperation and 

compliance with the rule, so inadvertent 

and unintentional noncompliance will 

be addressed long before any sanctions 

may be imposed. Further, the 

Department has decided to clarify the 

standards for reinstatement of a 

debarred contractor, and, as suggested, 

those standards are modeled on the 

regulation governing reinstatement of 

contractors debarred under Executive 

Order 11246, 41 CFR 60–1.31. Thus, 

under amended § 471.16, in connection 

with a reinstatement request to the 

Director of OLMS, debarred contractors 

are required to show that they have 

established and will carry out policies 

and practices in compliance with the 

Executive Order and implementing 

regulations. Before reaching a decision, 

the Director of OLMS may request that 

a compliance evaluation of the 

contractor be conducted, and may 

require the contractor to supply 

additional information regarding the 

request for reinstatement. If the Director 

of OLMS finds that the contractor or 

subcontractor has come into compliance 

with and will carry out the Executive 

Order and the regulation, the contractor 

or subcontractor may be reinstated. In 

addition, under the revised provision, 

the Director of OLMS shall issue a 

written decision on the request. See 

§ 471.16. 

Finally, in response to the comment 

suggesting that contractors not be 

compelled to police their subcontractors 

to determine compliance, the 

Department concludes that the operative 

provision in paragraph 4 of the contract 

clause of the Executive Order does not 

support the position suggested in the 

comment. This provision requires a 

contractor to ‘‘take such action with 

respect to any such subcontract as may 

be directed by the Secretary of Labor as 

a means of enforcing such provisions, 

including the imposition of sanctions 

for non-compliance.’’ 74 FR 6108. The 

provision thus indicates that a prime 

contractor cannot turn a blind eye 

toward noncompliance of its 

subcontractors, and should the 

Department become aware that a prime 

contractor has a significant number of 

subcontractors that are out of 

compliance with this rule, the 

Department may order that prime 

contractor to require its subcontractors 

to come into compliance. In the event 

that the contractor disregards such an 

order to seek compliance among its 

subcontractors, such disregard may 

make the prime contractor liable for 

penalties and sanctions in the same 

manner as if the contractor had failed to 

incorporate the contract clause or post 

the employee notice. In this regard, 

however, the prime contractor is liable 

for penalties and sanctions only insofar 

as it fails or refuses to seek compliance 

among subcontractors following an 

order by the Department to do so. If a 

prime contractor diligently seeks 

subcontractor compliance following 

such an order, but a subcontractor’s 

compliance is not forthcoming, the 

prime contractor will not be liable for 

the subcontractor’s noncompliance. As 

noted above, only § 471.16 of this 

subpart was modified in response to 

comments. 

Subpart C—Ancillary Matters 

A number of discrete issues unrelated 

to the issues addressed in the two 

previous subparts merit attention in this 

rule, and they are set out in this subpart. 

Consequently, this subpart addresses 

delegations of authority within and 

outside the Department to administer 

and enforce this rule, rulings under or 

interpretations of the Executive Order, 

standards prohibiting intimidation, 

threats, coercion or other interference 

with rights protected under this rule, 

and other provisions of the Executive 

Order that are included in this rule. The 

Department invited comment on these 

provisions and received none, save the 

suggestion discussed earlier in the 

context of enforcement that the 

Department delegate its enforcement 

role to the NLRB. Therefore, the 

provisions as proposed in this subpart 

will be retained, except that, as noted 

earlier, the roles and responsibilities 

given to the Assistant Secretary for ESA 

have been reassigned. 

Section 471.20 implements Section 11 

of the Executive Order, 74 FR 6110, 

which permits the delegation of the 

Secretary’s authority under the Order to 

Federal agencies within or outside the 

Department. Revised § 471.21 of the rule 

indicates that the Directors of OLMS 

and OFCCP will share the authority to 

make rulings under or interpretations of 

this rule, as appropriate and in 

accordance with their respective 

responsibilities under the rule. In this 

connection, requests for such rulings or 

interpretations must be submitted to the 

Director of OLMS, who will consult 

with the Director of OFCCP to the extent 

necessary and appropriate to issue the 

requested ruling or interpretation. 

Section 471.22 seeks to prevent 

intimidation or interference with rights 


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20The Department received two comments 

suggesting that the annual compliance costs were 

underestimated in the proposed rule. The first 

comment indicated that contractors will spend time 

each year reviewing the notice to assess whether it 

is consistent with legislation, or Board or court 

decisions. This comment also suggested that 

contractors would be ‘‘working under contract terms 

which would not only be out-of-sync which [sic] 

protected under this rule, so it indicates 

that the sanctions and penalties 

available for noncompliance set out in 

§ 471.14 will be available should a 

contractor or subcontractor fail to take 

all steps necessary to prevent such 

intimidation or interference. Activities 

protected by this section include filing 

a complaint, furnishing information, or 

assisting or participating in any manner 

in a compliance evaluation, a complaint 

investigation, hearing or any other 

activity related to the administration 

and enforcement of this rule. Finally, 

§ 471.23 implements Section 9 of the 

Executive Order, 74 FR 6109, which 

requires that contracting departments 

and agencies cooperate with the 

Secretary in carrying out her functions 

under the Order, and implements 

Section 15 of the Executive Order, 74 FR 

6110, which establishes general 

guidelines for the Order’s 

implementation. 

IV. Regulatory Procedures 

Executive Order 12866 

This final rule has been drafted and 

reviewed in accordance with Executive 

Order 12866, Section 1(b), Principles of 

Regulation. 58 FR 51735–36, Oct. 4, 

1993. The Department has determined 

that this rule is not an ‘‘economically 

significant’’ regulatory action under 

Section 3(f)(1) of Executive Order 

12866. 58 FR 51738. Based on the 

Department’s analysis, including a cost 

impact analysis set forth more fully 

below with regard to the Regulatory 

Flexibility Act, 5 U.S.C. 601 et seq., this 

rule is not likely to: (1) Have an annual 

effect on the economy of $100 million 

or more or adversely affect in a material 

way the economy, a sector of the 

economy, productivity, competition, 

jobs, the environment, public health or 

safety, or state, local, or tribal 

governments or communities; (2) create 

a serious inconsistency or otherwise 

interfere with an action taken or 

planned by another agency; (3) 

materially alter the budgetary impact of 

entitlements, grants, user fees, or loan 

programs or the rights and obligations of 

recipients thereof, or (4) raise novel 

legal or policy issues. 58 FR 51738. As 

a result, the Department has concluded 

that a full economic impact and cost/ 

benefit analysis is not required for the 

rule under section 6(a)(3)(B) of the 

Executive Order. 58 FR 51741. However, 

because of its importance to the public, 

the rule was reviewed by the Office of 

Management and Budget. 

Regulatory Flexibility Act 

The Regulatory Flexibility Act of 1980 

(‘‘RFA’’) requires agencies promulgating 

final rules to prepare a final regulatory 

flexibility analysis and to develop 

alternatives wherever possible, when 

drafting regulations that will have a 

significant impact on a substantial 

number of small entities. 5 U.S.C. 601 

et seq. The focus of the RFA is to ensure 

that agencies ‘‘review rules to assess and 

take appropriate account of the potential 

impact on small businesses, small 

governmental jurisdictions, and small 

organizations, as provided by the 

[RFA].’’ E.O. 13272, Sec. 1, 67 FR 53461 

(‘‘Proper Consideration of Small Entities 

in Agency Rulemaking’’). However, an 

agency is relieved of the obligation to 

prepare a final regulatory flexibility for 

a final rule if the Agency head certifies 

that the rule will not, if promulgated, 

have a significant economic impact on 

a substantial number of small entities. 5 

U.S.C. 605(b). Based on the analysis 

below, in which the Department has 

estimated the financial burdens to 

covered small contractors and 

subcontractors associated with 

complying with the requirements 

contained in this final rule, the 

Department has certified to the Chief 

Counsel for Advocacy of the Small 

Business Administration (‘‘SBA’’) that 

this rule will not have a significant 

economic impact on a substantial 

number of small entities. 

The primary goal of Executive Order 

13496 and these implementing 

regulations is the notification to 

employees of their rights with respect to 

collective bargaining and other 

protected, concerted activity. This goal 

is achieved through the incorporation of 

a contract clause in all covered 

Government contracts. The Executive 

Order and this rule impose the 

obligation to ensure that the contract 

clause is included in all Government 

contracts not on private contractors, but 

on Government contracting departments 

and agencies, which are not ‘‘small 

entities’’ that come within the focus of 

the RFA. Therefore, the costs attendant 

to learning of the obligation to include 

the contract clause in Government 

contracts and modifying those contracts 

in order to comply with that obligation 

is a cost borne by the Federal 

government, and is not incorporated 

into this analysis. 

Once the required contract clause is 

included in the Government contract, 

contractors then begin to assume the 

burdens associated with compliance. 

Those obligations include posting the 

required notice and incorporating the 

contract clause into all covered 

subcontracts, thus making the same 

obligations binding on covered 

subcontractors. For the purposes of the 

RFA analysis, the Department estimates 

that, on average, each prime contractor 

will subcontract some portion of its 

prime contract three times, and the 

prime contractor therefore will expend 

time ensuring that the contract clause is 

included in its subcontracts and 

notifying those subcontractors of their 

attendant obligations. To the extent that 

subcontractors subcontract any part of 

their contract with the prime contractor, 

they, in turn, will be required to expend 

time ensuring that the contract clause is 

included in the next tier of subcontracts 

and notifying the next-tier 

subcontractors of their attendant 

obligations. Therefore, for the purpose 

of determining time spent on 

compliance, the Department will not 

differentiate between the obligations of 

prime contractors and subsequent tiers 

of subcontractors in assessing time 

spent on compliance; the Department 

assumes that all contractors, whether 

prime contractor or subcontractor, will 

spend equivalent amounts of time 

engaging in compliance activity. 

The Department estimates that each 

contractor will spend a total of 3.5 hours 

per year in order to comply with this 

rule, which includes 90 minutes for the 

contractor to learn about the contract 

and notice requirements, train staff, and 

maintain records; 30 minutes for 

contractors to incorporate the contract 

clause into each subcontract and 

explain its contents to subcontractors; 

30 minutes acquiring the notice from a 

government agency or Web site; and 60 

minutes posting them physically and 

electronically, depending on where and 

how the contractor customarily posts 

notices to employees. The Department 

assumes that these activities will be 

performed by a professional or business 

worker, who, according to Bureau of 

Labor statistics data, earned a total 

hourly wage of $31.02 in January 2009, 

including accounting for fringe benefits. 

The Department then multiplied this 

figure by 3.5 hours to estimate the 

average annual costs for contractors and 

subcontractors to comply with this rule. 

Accordingly, this rule is estimated to 

impose average annual costs of $108.57 

per contractor (3.5 hours × $31.02). 

These costs will decrease in subsequent 

years based on a contractor’s increasing 

familiarity with the rule’s requirements 

and having already satisfied its posting 

requirements in earlier years.20 Based 


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the updated law, but also potentially in conflict 

with the updated law, thereby needlessly exposing 

them to potential liabilities or penalties.’’ The 

second comment indicated that the time allocated 

for incorporation in full of the contract clause was 

too low, but the comment did not suggest an 

alternate figure for that allocation. 

The Department concludes that neither of these 

comments provides an adequate basis to reassess 

the annual compliance cost estimates in the 

proposed rule. First, a contractor will not need to 

review legislation and Board or court decisions to 

ensure that the notice in the contract clause is 

accurate; this is the job of the Department. Second, 

the time allotment for the incorporation of the 

contract clause, whether by reference or in full, is 

essentially the same—the contractor must ensure 

that its subcontracts are revised to include a 

standard-form provision that establishes the duty to 

post the notice. After the first time the contractor 

ensures the accuracy of the provision that must be 

incorporated, the time a contractor devotes to 

ensuring the proper inclusion of the provision on 

an ongoing basis should not increase as a result of 

the length of the provision. In any event, as noted 

above, the Department has revised the prohibition 

against incorporation of the contract clause by 

reference proposed in the NPRM, and the final rule 

now permits incorporation of the contract clause by 

reference. Finally, the Department rejects the 

premise that the notice or the contract clause 

containing it will be ‘‘out-of-sync’’ with the state of 

the law, thereby exposing a contractor to liabilities 

or penalties. 

21The Federal Funding Accountability and 

Transparency Act of 2006, Pub. L. 109–282 (Sept. 

26, 2006), requires that the Office of Management 

and Budget establish a single searchable Web site, 

accessible by the public for free, that includes for 

each Federal award: (1) The name of the entity 

receiving the award; (2) the amount of the award; 

(3) information on the award including transaction 

type, funding agency, etc.; (4) the location of the 

entity receiving the award; and (5) a unique 

identifier of the entity receiving the award. See 31 

U.S.C.A. § 6101 note. In compliance with this 

requirement, USASpending.gov was established. 

22The Federal Procurement Data System (‘‘FPDS’’) 

compiles data regarding small business ‘‘actions’’ 

and small business ‘‘dollars’’ using the criteria 

employed by SBA to define ‘‘small entities.’’ In FY 

2008, small business actions accounted for 50% of 

all Federal procurement action. However, deriving 

a percentage of contractors that are small using the 

‘‘action’’ data would overstate the number of small 

contractors because contract actions reflect more 

than just contracts; they include modifications, 

blanket purchase agreement calls, task orders, and 

federal supply schedule orders. As a result, there 

are many more contract actions than there are 

contracts or contractors. Accordingly, a single small 

contractor might have hundreds of actions, e.g., 

delivery or task orders, placed against its contract. 

These contract actions would be counted 

individually in the FPDS, but in fact represent only 

one small business. 

Also reflected in FPDS, in FY 2008, small 

business ‘‘dollars’’ accounted for 19% of all Federal 

dollars spent. However, deriving a percentage of 

contractors that are small using the ‘‘dollars’’ data 

would understate the number of small contractors. 

Major acquisitions account for a disproportionate 

share of the dollar amounts and are almost 

exclusively awarded to large businesses. For 

instance, Lockheed Martin was awarded $34 billion 

in contracts in FY 2008, which accounted for 6% 

of all Federal spending in that year. The top five 

federal contractors, all large businesses, accounted 

for over 20% of contract dollars in FY 2008. As a 

result, because the largest Federal contractors 

disproportionately represent ‘‘dollars’’ spent by the 

Federal government, the FPDB’s data on small 

‘‘dollars’’ spent understates the number of small 

entities with which the Federal government does 

business. 

The Department concludes that the percentage of 

all Federal contractors that are ‘‘small’’ is probably 

somewhere between 19% and 50%, the two 

percentages derived from the FPDS figures on small 

‘‘actions’’ and small ‘‘dollars.’’ The mean of these 

two percentages is approximately 35%, and the 

Department will use this figure above to estimate 

how many of all Federal contractors are ‘‘small 

entities’’ in SBA’s terms. 

23The Department received one comment 

asserting that the Department erroneously 

concluded in the proposed rule that an effect on an 

estimated 67% of the federal contractor community 

was insubstantial. To the contrary, the Department 

noted in the proposed rule, as here, that the rule 

was likely to affect a ‘‘substantial number of federal 

Continued 

upon figures obtained from 

USASpending.gov, which compiles 

information on federal spending and 

contractors across government agencies, 

the Department concludes that there 

were 186,536 unique Federal 

contractors holding Federal contracts in 

FY 2008.21 Although this rule does not 

apply to Federal contracts below the 

simplified acquisition threshold, the 

Department does not have a means by 

which to calculate what portion of all 

Federal contractors hold only contracts 

with the government below the 

simplified acquisition threshold. 

Therefore, in order to determine the 

number of entities affected by this rule, 

the Department counted all Federal 

contractors, regardless of the size of the 

government contract held. Based on 

data analyzed in the Federal 

Procurement Data System (fpds.gov), 

which compiles data about types of 

contractors, of all 186,536 unique 

Federal prime contractors, 

approximately 35% are ‘‘small entities’’ 

as defined by the Small Business 

Administration (SBA) size standards.22

Therefore, for the purposes of the RFA 

analysis, the Department estimates that 

this rule will affect 65,288 small Federal 

prime contractors. 

As noted above, for the purposes of 

this analysis, the Department estimates 

that each prime contractor subcontracts 

a portion of the prime contract three 

times, on average. However, the 

community of prime contractors does 

not utilize a unique subcontractor for 

each subcontract; the Department 

assumes that subcontractors may be 

working under several prime contracts 

for either a single prime contractor or 

multiple prime contractors, or both. In 

addition, some subcontractors may also 

be holding prime contracts with the 

government, so they may already be 

counted as affected entities. Therefore, 

in order to determine the unique 

number of subcontractors affected by 

this rule, the Department estimates there 

are the same number of unique 

subcontractors as prime contractors, 

resulting in the estimate that 186,536 

subcontractors are affected by this rule. 

Further, for the purposes of this 

analysis, the Department assumes that 

all subcontractors are ‘‘small entities’’ as 

defined by SBA size standards. 

Therefore, in order to estimate the total 

number of ‘‘small’’ contractors affected 

by this rule, the Department has added 

together the estimates for the number of 

small prime contractors calculated 

above (65,288) with the estimate of all 

subcontractors (186,536), all of which 

we assume are small. Accordingly, the 

Department estimates that 251,824 small 

prime and subcontractors are affected by 

this rule. 

Based on this analysis, the 

Department concludes that this final 

rule will not have a significant 

economic impact on a substantial 

number of small entities. The 

Regulatory Flexibility Act does not 

define either ‘‘significant economic 

impact’’ or ‘‘substantial’’ as it relates to 

the number of regulated entities. 5 

U.S.C. 601. In the absence of specific 

definitions, ‘‘what is ‘significant’ or 

‘substantial’ will vary depending on the 

problem that needs to be addressed, the 

rule’s requirements, and the preliminary 

assessment of the rule’s impact.’’ See A 

Guide for Government Agencies: How to 

Comply with the Regulatory Flexibility 

Act, Office of Advocacy, U.S. Small 

Business Administration at 17 (available 

at http://www.sba.gov) (‘‘SBA Guide’’). 

As to economic impact, one important 

indicator is the cost of compliance in 

relation to revenue of the entity or the 

percentage of profits affected. Id. In this 

case, the Department has determined 

that the average cost of compliance with 

this rule in the first year for all Federal 

contractors and subcontractors will be 

$108.57. The Department concludes that 

this economic impact is not significant. 

Furthermore, the Department has 

determined that of the entire regulated 

community of all 186,536 prime 

contractors and all 186,536 

subcontractors, 67% percent of that 

regulated community constitute small 

entities (251,824 small contractors 

divided by all 373,072 contractors). 

Although this figure represents a 

substantial number of federal 

contractors and subcontractors, because 

Federal contractors are derived from 

virtually all segments of the economy 

and across industries, this figure is a 

small portion of the national economy 

overall. Id. at 20 (‘‘the substantiality of 

the number of businesses affected 

should be determined on an industryspecific basis and/or the number of 

small businesses overall’’).23


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contractors and subcontractors.’’ 74 FR at 38495. 

However, the purpose of the RFA, and it focus, is 

to minimize the impact of agency regulations on 

particular industries or sectors of the economy. See 

SBA Guide at 15–20. As stated in the proposed rule 

and above, federal contractors and subcontractors 

represent all industries and sectors of the economy, 

thus the effect of the rule is dissipated across the 

economy. As an alternative approach, the comment 

urged the Department to recognize federal 

contractors and subcontractors as a discrete 

‘‘industry,’’ which the Department declines to do 

because the adoption of such a standard would 

defeat the focus of the analysis. Finally, in 

assuming both here and in the proposed rule that 

100% of subcontractors were small within SBA’s 

terms, the Department employed an expansive 

estimate that undoubtedly inflated of the overall 

number of affected entities. The use of the broad 

assumption serves to illustrate the point that even 

if a substantial number of federal contractors and 

subcontractors are affected by the final rule, the 

effect of the rule on the economy as a whole is not 

substantial. 

Accordingly, the Department concludes 

that the rule does not impact a 

substantial number of small entities in 

a particular industry or segment of the 

economy. Therefore, under 5 U.S.C. 605, 

the Department concludes that the final 

rule will not have a significant 

economic impact on a substantial 

number of small entities. 

Unfunded Mandates Reform 

For purposes of the Unfunded 

Mandates Reform Act of 1995, this rule 

would not include any Federal mandate 

that might result in increased 

expenditures by State, local, and tribal 

governments, or increased expenditures 

by the private sector of more than $100 

million in any one year. 

Paperwork Reduction Act 

As part of its continuing effort to 

reduce paperwork and respondent 

burden, the Department of Labor 

conducts a public consultation program 

to provide the general public and 

Federal agencies with an opportunity to 

comment on proposed and continuing 

collections of information in accordance 

with the Paperwork Reduction Act of 

1995 (‘‘PRA’’) (44 U.S.C. 3506(c)(2)(A)). 

This helps to ensure that the public 

understands the Department’s collection 

instructions; respondents can provide 

the requested data in the desired format, 

reporting burden (time and financial 

resources) is minimized, collection 

instruments are clearly understood, and 

the Department can properly assess the 

impact of collection requirements on 

respondents. 

Certain sections of this rule, including 

§ 471.11(a) and (b), contain information 

collection requirements for purposes of 

the PRA. In accordance with the PRA, 

the August 3, 2009 NPRM solicited 

comments on the information 

collections as they were proposed. 

Additionally, the Department separately 

requested comments on the information 

collections in a 60 day notice published 

in the Federal Register on September 8, 

2009 (74 FR 46236), and submitted a 

contemporaneous request for OMB 

review of the proposed collection of 

information. The Department did not 

receive any comments in response to 

either the NPRM PRA analysis or the 

September 8, 2009 notice. OMB did not 

approve the collections of information 

contained in the NPRM stage of this 

rulemaking, and directed the 

Department to resubmit the relevant 

PRA documentation to OMB at the final 

rulemaking stage. 

The rule requires contractors to post 

notices and cooperate with any 

investigation in response to a complaint 

or as part of a compliance evaluation. It 

also permits employees to file 

complaints with the Department 

alleging that a contractor has failed to 

comply with those requirements. The 

application of the PRA to those 

requirements is discussed below. 

The final rule imposes certain 

minimal burdens associated with the 

posting of the employee notice poster 

required by the Executive Order and 

§ 471.2(a). As noted in § 471.2(e), the 

Department will supply the notice, and 

contractors will be permitted to post 

exact duplicate copies of the notice. 

Under the regulations implementing the 

PRA, ‘‘[t]he public disclosure of 

information originally supplied by the 

Federal government to [a] recipient for 

the purpose of disclosure to the public’’ 

is not considered a ‘‘collection of 

information’’ under the Act. See 5 CFR 

1320.3(c)(2). Therefore, the posting 

requirement is not subject to the PRA. 

The final rule will also impose certain 

burdens on the contractor associated 

with cooperating with an investigation 

into failure to comply with Part 471. 

The regulations implementing the PRA 

exempt any information collection 

requirements imposed by an 

administrative agency during the 

conduct of an administrative action 

against specific individuals or entities. 

See 5 CFR 1320.4. Once the agency 

opens a case file or equivalent about a 

particular party, this exception applies 

during the entire course of the 

investigation, before or after formal 

charges or complaints are filed or formal 

administrative action is initiated. Id. 

Therefore, this exemption would apply 

to the Department’s investigation of 

complaints alleging violations of the 

Order or this rule as well as compliance 

evaluations. 

As for the burden hour estimate for 

employees filing complaints, the 

Department estimates, based on the 

experience of OFCCP administering 

other laws applicable to Federal 

contractors, that it will take an average 

of 1.28 hours for such a complainant to 

compose a complaint containing the 

necessary information and to send that 

complaint to the Department. This 

number is also consistent with the 

burden estimate for filing a complaint 

under E.O. 13201 and the now-revoked 

Part 470 regulations. 

The Department has estimated it 

would receive a total of 50 employee 

complaints in any given year, which is 

significantly larger than the estimate 

contained its most recent PRA 

submission for Executive Order 13201. 

In that submission, the Department 

estimated it would receive 20 employee 

complaints. This number itself had been 

revised downwards because the 

Department never received any 

employee complaints pursuant to the 

now-revoked Part 470 regulations. 

Because the applicability of the final 

rule and Executive Order 13496 is 

greater in scope than the now-revoked 

Part 470 and Executive Order 13201 in 

terms of geography (the now-revoked 

Part 470 regulations only applied to 

states without right-to-work laws, 

whereas this rule applies nationwide), 

the Department has revised upwards its 

estimate of employee complaints under 

this rule from 20 to 50. 

Section 471.3(b) permits contracting 

departments to submit written requests 

for an exemption from the obligations of 

the Executive Order (waiver request) as 

to particular contracts or classes of 

contracts under specified circumstance. 

The PRA does not cover the costs to the 

Federal government for the submission 

of waiver requests by contracting 

agencies or departments or for the 

processing of waiver requests by the 

Department of Labor. The regulations 

implementing the PRA define the term 

‘‘burden,’’ in pertinent part, as ‘‘the total 

time, effort, or financial resources 

expended by persons to generate, 

maintain, retain, or disclose or provide 

information to or for a Federal agency.’’ 

5 CFR 1320.3(b)(1). The definition of the 

term ‘‘person’’ in the same regulations 

includes ‘‘an individual, partnership, 

association, corporation (including 

operations of government-owned 

contractor-operated facilities), business 

trust, or legal representative, an 

organized group of individuals, a State, 

territorial, tribal, or local government or 

branch thereof, or a political 

subdivision of a State, territory, tribal, 

or local government or a branch of a 

political subdivision.’’ 5 CFR 1320.3(k). 

It does not include the Federal 

government or any branch, political 

subdivision, or employee thereof. 

Therefore, the cost to the Federal 


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government for the submission of 

waiver requests by contracting agencies 

and departments need not be taken into 

consideration. 

The Department invited the public to 

comment on whether each of the 

proposed collections of information: (1) 

Ensures that the collection of 

information is necessary to the proper 

performance of the agency, including 

whether the information will have 

practical utility; (2) estimates the 

projected burden, including the validity 

of the methodology and assumptions 

used, accurately; (3) enhances the 

quality, utility, and clarity of the 

information to be collected; and (4) 

minimizes the burden of the collection 

of information on those who are to 

respond, including through the use of 

appropriate automated, electronic, 

mechanical, or other technological 

collection techniques or other forms of 

information technology (e.g., permitting 

electronic submission of responses). As 

noted above, the Department received 

no comments on the PRA analysis. 

The Department notes that a federal 

agency cannot conduct or sponsor a 

collection of information unless it is 

approved by OMB under the PRA, and 

displays a currently valid OMB control 

number, and the public is not required 

to respond to a collection of information 

unless it displays a currently valid OMB 

control number. Also, notwithstanding 

any other provisions of law, no person 

shall be subject to penalty for failing to 

comply with a collection of information 

if the collection of information does not 

display a currently valid OMB control 

number. 

As instructed by OMB and in 

accordance with the PRA (5 CFR 

1320.11 (h)), in connection with this 

final rule, the Department submitted an 

ICR to OMB for its request of the new 

information collection requirements 

contained in this rule. OMB approved 

the ICR on May 5, 2010, under OMB 

Control Number 1215–0209, which will 

expire on May 31, 2013. 

Executive Order 13132 (Federalism) 

The Department has reviewed this 

rule in accordance with Executive Order 

13132 regarding federalism, and has 

determined that the rule does not have 

‘‘federalism implications.’’ The 

employee notice required by the 

Executive Order and part 471 must be 

posted only by employers covered 

under the NLRA. Therefore, the rule 

does not ‘‘have substantial direct effects 

on the States, on the relationship 

between the national government and 

the States, or on the distribution of 

power and responsibilities among the 

various levels of government.’’ 

Executive Order 13084 (Consultation 

and Coordination With Indian Tribal 

Governments) 

The Department certifies that this 

final rule does not impose substantial 

direct compliance costs on Indian tribal 

governments. 

Small Business Regulatory Enforcement 

Fairness Act of 1996 

This rule is not a major rule as 

defined by Section 804 of the Small 

Business Regulatory Enforcement 

Fairness Act of 1996. This rule will not 

result in an annual effect on the 

economy of $100 million or more; a 

major increase in costs or prices; or 

significant adverse effects on 

competition, employment, investment, 

productivity, innovation, or on the 

ability of the United States-based 

companies to compete with foreignbased companies in domestic and 

export markets. 

List of Subjects in 29 CFR Part 471 

Administrative practice and 

procedure, Government contracts, 

Employee rights, Labor unions. 

Text of Final Rule 

■ Accordingly, a new Subchapter D, 

consisting of Part 471, is added to 29 

CFR Chapter IV to read as follows: 

Subchapter D—Notification of 

Employee Rights Under Federal Labor 

Laws 

PART 471—OBLIGATIONS OF 

FEDERAL CONTRACTORS AND 

SUBCONTRACTORS; NOTIFICATION 

OF EMPLOYEE RIGHTS UNDER 

FEDERAL LABOR LAWS 

Subpart A—Definitions, Requirements 

for Employee Notice, and Exceptions 

and Exemptions 

Sec. 

471.1 What definitions apply to this part? 

471.2 What employee notice clause must 

be included in Government contracts? 

471.3 What exceptions apply and what 

exemptions are available? 

471.4 What employers are not covered 

under the rule? 

Appendix A to Subpart A of Part 471— 

Text of Employee Notice Clause 

Sec. 

Subpart B—General Enforcement; 

Compliance Review and Complaint 

Procedures 

471.10 How will the Department determine 

whether a contractor is in compliance 

with Executive Order 13496 and this 

part? 

471.11 What are the procedures for filing 

and processing a complaint? 

471.12 What are the procedures to be 

followed when a violation is found 

during a complaint investigation or 

compliance evaluation? 

471.13 Under what circumstances, and 

how, will enforcement proceedings 

under Executive Order 13496 be 

conducted? 

471.14 What sanctions and penalties may 

be imposed for noncompliance, and 

what procedures will the Department 

follow in imposing such sanctions and 

penalties? 

471.15 Under what circumstances must a 

contractor be provided the opportunity 

for a hearing? 

471.16 Under what circumstances may a 

contractor be reinstated? 

Subpart C—Ancillary Matters 

471.20 What authority under this part or 

Executive Order 13496 may the Secretary 

delegate, and under what circumstances? 

471.21 Who will make rulings and 

interpretations under Executive Order 

13496 and this part? 

471.22 What actions may the Director of 

OLMS take in the case of intimidation 

and interference? 

471.23 What other provisions apply to this 

part? 

Authority: 40 U.S.C. 101 et seq.; Executive 

Order 13496, 74 FR 6107, February 4, 2009; 

Secretary’s Order 7–2009, 74 FR 58834, Nov. 

13, 2009; Secretary’s Order 8–2009, 74 FR 

58835, Nov. 13, 2009. 

Subpart A—Definitions, Requirements 

for Employee Notice, and Exceptions 

and Exemptions 

§ 471.1 What definitions apply to this part? 

Construction means the construction, 

rehabilitation, alteration, conversion, 

extension, demolition, weatherization, 

or repair of buildings, highways, or 

other changes or improvements to real 

property, including facilities providing 

utility services. The term construction 

also includes the supervision, 

inspection, and other on-site functions 

incidental to the actual construction. 

Construction work site means the 

general physical location of any 

building, highway, or other change or 

improvement to real property which is 

undergoing construction, rehabilitation, 

alteration, conversion, extension, 

demolition, weatherization or repair, 

and any temporary location or facility at 

which a contractor or subcontractor 

meets a demand or performs a function 

relating to the contract or subcontract. 

Contract means, unless otherwise 

indicated, any Government contract or 

subcontract. 

Contracting agency means any 

department, agency, establishment, or 

instrumentality in the executive branch 

of the Government, including any 

wholly owned Government corporation, 

that enters into contracts. 


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Contractor means, unless otherwise 

indicated, a prime contractor or 

subcontractor. 

Department means the U.S. 

Department of Labor. 

Director of OFCCP means the Director 

of the Office of Federal Contract 

Compliance Programs in the Department 

of Labor. 

Director of OLMS means the Director 

of the Office of Labor-Management 

Standards in the Department of Labor. 

Employee notice clause means the 

contract clause set forth in Appendix A 

that Government contracting 

departments and agencies must include 

in all Government contracts and 

subcontracts pursuant to Executive 

Order 13496 and this part. 

Government means the Government of 

the United States of America. 

Government contract means any 

agreement or modification thereof 

between any contracting agency and any 

person for the purchase, sale, or use of 

personal property or non-personal 

services. The term ‘‘personal property,’’ 

as used in this section, includes 

supplies, and contracts for the use of 

real property (such as lease 

arrangements), unless the contract for 

the use of real property itself constitutes 

real property (such as easements). The 

term ‘‘non-personal services’’ as used in 

this section includes, but is not limited 

to, the following services: utilities, 

construction, transportation, research, 

insurance, and fund depository. The 

term Government contract does not 

include: 

(1) Agreements in which the parties 

stand in the relationship of employer 

and employee; and 

(2) Federal financial assistance, as 

defined in 29 CFR 31.2. 

Labor organization means any 

organization of any kind, or any agency 

or employee representation committee 

or plan, in which employees participate 

and which exists for the purpose, in 

whole or in part, of dealing with 

employers concerning grievances, labor 

disputes, wages, rates of pay, hours of 

employment, or conditions of work. 

Modification of a contract means any 

alteration in the terms and conditions of 

that contract, including amendments, 

renegotiations, and renewals. 

Order or Executive Order means 

Executive Order 13496 (74 FR 6107, 

Feb. 4, 2009). 

Person means any natural person, 

corporation, partnership, 

unincorporated association, State or 

local government, and any agency, 

instrumentality, or subdivision of such 

a government. 

Prime contractor means any person 

holding a contract with a contracting 

agency, and, for the purposes of 

subparts B and C of this part, includes 

any person who has held a contract 

subject to the Executive Order and this 

part. 

Related rules, regulations, and orders 

of the Secretary of Labor, as used in 

§ 471.2 of this part, means rules, 

regulations, and relevant orders issued 

pursuant to the Executive Order or this 

part. 

Secretary means the Secretary of 

Labor, U.S. Department of Labor, or his 

or her designee. 

Subcontract means any agreement or 

arrangement between a contractor and 

any person (in which the parties do not 

stand in the relationship of an employer 

and an employee): 

(1) For the purchase, sale or use of 

personal property or non-personal 

services that, in whole or in part, is 

necessary to the performance of any one 

or more contracts; or 

(2) Under which any portion of the 

contractor’s obligation under any one or 

more contracts is performed, undertaken 

or assumed. 

Subcontractor means any person 

holding a subcontract and, for the 

purposes of subparts B and C of this 

part, any person who has held a 

subcontract subject to the Executive 

Order and this part. 

Union means a labor organization as 

defined above. 

United States means the several 

States, the District of Columbia, the 

Virgin Islands, the Commonwealth of 

Puerto Rico, Guam, American Samoa, 

the Commonwealth of the Northern 

Mariana Islands, and Wake Island. 

§ 471.2 What employee notice clause must 

be included in Government contracts? 

(a) Government contracts. With 

respect to all contracts covered by this 

part, Government contracting 

departments and agencies must, to the 

extent consistent with law, include the 

language set forth in Appendix A to 

Subpart A of Part 471 in every 

Government contract, other than those 

contracts to which exceptions are 

applicable as stated in § 471.3. 

(b) Inclusion by reference. The 

employee notice clause need not be 

quoted verbatim in a contract, 

subcontract, or purchase order. The 

clause may be made part of the contract, 

subcontract, or purchase order by 

citation to 29 CFR Part 471, Appendix 

A to Subpart A. 

(c) Adaptation of language. The 

Director of OLMS may find that an Act 

of Congress, clarification of existing law 

by the courts or the National Labor 

Relations Board, or other circumstances 

make modification of the contractual 

provisions necessary to achieve the 

purposes of the Executive Order and 

this part. In such circumstances, the 

Director of OLMS will promptly issue 

rules, regulations, or orders as are 

needed to ensure that all future 

government contracts contain 

appropriate provisions to achieve the 

purposes of the Executive Order and 

this part. 

(d) Physical Posting of Employee 

Notice. A contractor or subcontractor 

that posts notices to employees 

physically must also post the required 

notice physically. Where a significant 

portion of a contractor’s workforce is 

not proficient in English, the contractor 

must provide the notice in the language 

employees speak. The employee notice 

must be placed: 

(1) In conspicuous places in and 

about the contractor’s plants and offices 

so that the notice is prominent and 

readily Seen by employees. Such 

conspicuous placement includes, but is 

not limited to, areas in which the 

contractor posts notices to employees 

about the employees’ terms and 

conditions of employment; and 

(2) Where employees covered by the 

National Labor Relations Act engage in 

activities relating to the performance of 

the contract. An employee shall be 

considered to be so engaged if: 

(i) The duties of the employee’s 

position include work that fulfills a 

contractual obligation, or work that is 

necessary to, or that facilitates, 

performance of the contract or a 

provision of the contract; or 

(ii) The cost or a portion of the cost 

of the employee’s position is allowable 

as a cost of the contract under the 

principles set forth in the Federal 

Acquisition Regulation at 48 CFR Ch. 1, 

part 31: Provided, That a position shall 

not be considered covered by this part 

by virtue of this provision if the cost of 

the position was not allocable in whole 

or in part as a direct cost to any 

Government contract, and only a de 

minimis (less than 2%) portion of the 

cost of the position was allocable as an 

indirect cost to Government contracts, 

considered as a group. 

(e) Obtaining a poster with the 

employee notice. A poster with the 

required employee notice, including a 

poster with the employee notice 

translated into languages other than 

English, will be printed by the 

Department, and will be provided by the 

Federal contracting agency or may be 

obtained from the Division of 

Interpretations and Standards, Office of 

Labor-Management Standards, U.S. 

Department of Labor, 200 Constitution 

Avenue, NW., Room N–5609, 

Washington, DC 20210, or from any 


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field office of the Department’s Office of 

Labor-Management Standards or Office 

of Federal Contract Compliance 

Programs. A copy of the poster in 

English and in languages other than 

English may also be downloaded from 

the Office of Labor-Management 

Standards Web site at http:// 

www.olms.dol.gov. Additionally, 

contractors may reproduce and use 

exact duplicate copies of the 

Department’s official poster. 

(f) Electronic postings of employee 

notice. A contractor or subcontractor 

that customarily posts notices to 

employees electronically must also post 

the required notice electronically. Such 

contractors or subcontractors satisfy the 

electronic posting requirement by 

displaying prominently on any Web site 

that is maintained by the contractor or 

subcontractor, whether external or 

internal, and customarily used for 

notices to employees about terms and 

conditions of employment, a link to the 

Department of Labor’s Web site that 

contains the full text of the poster. The 

link to the Department’s Web site must 

read, ‘‘Important Notice about Employee 

Rights to Organize and Bargain 

Collectively with Their Employers.’’ 

Where a significant portion of a 

contractor’s workforce is not proficient 

in English, the contractor must provide 

the notice required in this subsection in 

the language the employees speak. This 

requirement will be satisfied by 

displaying prominently on any Web site 

that is maintained by the contractor or 

subcontractor, whether external or 

internal, and customarily used for 

notices to employees about terms and 

conditions of employment, a link to the 

Department of Labor’s Web site that 

contains the full text of the poster in the 

language the employees speak. In such 

cases, the Office of Labor-Management 

Standards will provide translations of 

the link to the Department’s Web site 

that must be displayed on the 

contractor’s or subcontractor’s Web site. 

§ 471.3 What exceptions apply and what 

exemptions are available? 

(a) Exceptions for specific types of 

contracts. The requirements of this part 

do not apply to any of the following: 

(1) Collective bargaining agreements 

as defined in the Federal Service LaborManagement Relations Statute, entered 

into by an agency and the exclusive 

representative of employees in an 

appropriate unit to set terms and 

conditions of employment of those 

employees. 

(2) Government contracts that involve 

purchases below the simplified 

acquisition threshold set by Congress 

under the Office of Federal Procurement 

Policy Act. Therefore, the employee 

notice clause need not be included in 

government contracts for purchases 

below that threshold, provided that 

(i) No agency or contractor is 

permitted to procure supplies or 

services in a manner designed to avoid 

the applicability of the Order and this 

part; and 

(ii) The employee notice clause must 

be included in government contracts for 

indefinite quantities, unless the 

contracting agency or contractor has 

reason to believe that the amount to be 

ordered in any year under such a 

contract will be less than the simplified 

acquisition threshold set in the Office of 

Federal Procurement Policy Act. 

(3) Government contracts resulting 

from solicitations issued before the 

effective date of this rule. 

(4) Subcontracts of $10,000 or less in 

value, except that contractors and 

subcontractors are not permitted to 

procure supplies or services in a manner 

designed to avoid the applicability of 

the Order and this part. 

(5) Contracts and subcontracts for 

work performed exclusively outside the 

territorial United States. 

(b) Exemptions for certain contracts. 

The Director of OLMS may exempt a 

contracting department or agency or 

groups of departments or agencies from 

the requirements of this part with 

respect to a particular contract or 

subcontract or any class of contracts or 

subcontracts when the Director finds 

that either: 

(1) The application of any of the 

requirements of this part would not 

serve its purposes or would impair the 

ability of the Government to procure 

goods or services on an economical and 

efficient basis; or 

(2) Special circumstances require an 

exemption in order to serve the national 

interest. 

(c) Procedures for requesting an 

exemption and withdrawals of 

exemptions. Requests for exemptions 

under this subsection from a contracting 

department or agency must be in 

writing, and must be directed to the 

Director of OLMS, U.S. Department of 

Labor, 200 Constitution Avenue, NW., 

Room N–5603, Washington, DC, 20210. 

The Director of OLMS may withdraw an 

exemption granted when, in the 

Director’s judgment, such action is 

necessary or appropriate to achieve the 

purposes of this part. 

§ 471.4 What employers are not covered 

under this part? 

(a) The following employers are 

excluded from the definition of 

‘‘employer’’ in the National Labor 

Relations Act (NLRA), and are not 

covered by the requirements of this part: 

(1) The United States or any wholly 

owned Government corporation; 

(2) Any Federal Reserve Bank; 

(3) Any State or political subdivision 

thereof; 

(4) Any person subject to the Railway 

Labor Act; 

(5) Any labor organization (other than 

when acting as an employer); or 

(6) Anyone acting in the capacity of 

officer or agent of such labor 

organization. 

(b) Additionally, employers 

exclusively employing workers who are 

excluded from the definition of 

‘‘employee’’ under the NLRA are not 

covered by the requirements of this part. 

Those excluded employees are 

employed: 

(1) As agricultural laborers; 

(2) In the domestic service of any 

family or person at his home; 

(3) By his or her parent or spouse; 

(4) As an independent contractor; 

(5) As a supervisor as defined under 

the NLRA; 

(6) By an employer subject to the 

Railway Labor Act; or 

(7) By any other person who is not an 

employer as defined in the NLRA 

Appendix A to Subpart A of Part 471— 

Text of Employee Notice Clause 

‘‘1. During the term of this contract, the 

contractor agrees to post a notice, of such size 

and in such form, and containing such 

content as the Secretary of Labor shall 

prescribe, in conspicuous places in and about 

its plants and offices where employees 

covered by the National Labor Relations Act 

engage in activities relating to the 

performance of the contract, including all 

places where notices to employees are 

customarily posted both physically and 

electronically. The ‘‘Secretary’s notice’’ shall 

consist of the following: 

‘‘Employee Rights Under The National Labor 

Relations Act’’ 

‘‘The NLRA guarantees the right of 

employees to organize and bargain 

collectively with their employers, and to 

engage in other protected concerted activity. 

Employees covered by the NLRA* are 

protected from certain types of employer and 

union misconduct. This Notice gives you 

general information about your rights, and 

about the obligations of employers and 

unions under the NLRA. Contact the National 

Labor Relations Board, the Federal agency 

that investigates and resolves complaints 

under the NLRA, using the contact 

information supplied below, if you have any 

questions about specific rights that may 

apply in your particular workplace. 

‘‘Under the NLRA, you have the right to: 

• Organize a union to negotiate with your 

employer concerning your wages, hours, and 

other terms and conditions of employment. 

• Form, join or assist a union. 


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• Bargain collectively through 

representatives of employees’ own choosing 

for a contract with your employer setting 

your wages, benefits, hours, and other 

working conditions. 

• Discuss your terms and conditions of 

employment or union organizing with your 

co-workers or a union. 

• Take action with one or more co-workers 

to improve your working conditions by, 

among other means, raising work-related 

complaints directly with your employer or 

with a government agency, and seeking help 

from a union. 

• Strike and picket, depending on the 

purpose or means of the strike or the 

picketing. 

• Choose not to do any of these activities, 

including joining or remaining a member of 

a union. 

‘‘Under the NLRA, it is illegal for your 

employer to: 

• Prohibit you from soliciting for a union 

during non-work time, such as before or after 

work or during break times; or from 

distributing union literature during non-work 

time, in non-work areas, such as parking lots 

or break rooms. 

• Question you about your union support 

or activities in a manner that discourages you 

from engaging in that activity. 

• Fire, demote, or transfer you, or reduce 

your hours or change your shift, or otherwise 

take adverse action against you, or threaten 

to take any of these actions, because you join 

or support a union, or because you engage in 

concerted activity for mutual aid and 

protection, or because you choose not to 

engage in any such activity. 

• Threaten to close your workplace if 

workers choose a union to represent them. 

• Promise or grant promotions, pay raises, 

or other benefits to discourage or encourage 

union support. 

• Prohibit you from wearing union hats, 

buttons, t-shirts, and pins in the workplace 

except under special circumstances. 

• Spy on or videotape peaceful union 

activities and gatherings or pretend to do so. 

‘‘Under the NLRA, it is illegal for a union 

or for the union that represents you in 

bargaining with your employer to: 

• Threaten you that you will lose your job 

unless you support the union. 

• Refuse to process a grievance because 

you have criticized union officials or because 

you are not a member of the union. 

• Use or maintain discriminatory 

standards or procedures in making job 

referrals from a hiring hall. 

• Cause or attempt to cause an employer 

to discriminate against you because of your 

union-related activity. 

• Take other adverse action against you 

based on whether you have joined or support 

the union. 

‘‘If you and your coworkers select a union 

to act as your collective bargaining 

representative, your employer and the union 

are required to bargain in good faith in a 

genuine effort to reach a written, binding 

agreement setting your terms and conditions 

of employment. The union is required to 

fairly represent you in bargaining and 

enforcing the agreement. 

‘‘Illegal conduct will not be permitted. If 

you believe your rights or the rights of others 

have been violated, you should contact the 

NLRB promptly to protect your rights, 

generally within six months of the unlawful 

activity. You may inquire about possible 

violations without your employer or anyone 

else being informed of the inquiry. Charges 

may be filed by any person and need not be 

filed by the employee directly affected by the 

violation. The NLRB may order an employer 

to rehire a worker fired in violation of the 

law and to pay lost wages and benefits, and 

may order an employer or union to cease 

violating the law. Employees should seek 

assistance from the nearest regional NLRB 

office, which can be found on the Agency’s 

Web site: http://www.nlrb.gov. ‘‘Click on the 

NLRB’s page titled ‘‘About Us,’’ which 

contains a link, ‘‘Locating Our Offices.’’ You 

can also contact the NLRB by calling toll-free: 

1–866–667–NLRB (6572) or (TTY) 1–866– 

315–NLRB (6572) for hearing impaired. 

‘‘* The National Labor Relations Act covers 

most private-sector employers. Excluded 

from coverage under the NLRA are publicsector employees, agricultural and domestic 

workers, independent contractors, workers 

employed by a parent or spouse, employees 

of air and rail carriers covered by the Railway 

Labor Act, and supervisors (although 

supervisors that have been discriminated 

against for refusing to violate the NLRA may 

be covered). 

‘‘This is an official Government Notice and 

must not be defaced by anyone. 

‘‘2. The contractor will comply with all 

provisions of the Secretary’s notice, and 

related rules, regulations, and orders of the 

Secretary of Labor. 

‘‘3. In the event that the contractor does not 

comply with any of the requirements set 

forth in paragraphs (1) or (2) above, this 

contract may be cancelled, terminated, or 

suspended in whole or in part, and the 

contractor may be declared ineligible for 

further Government contracts in accordance 

with procedures authorized in or adopted 

pursuant to Executive Order 13496 of January 

30, 2009. Such other sanctions or remedies 

may be imposed as are provided in Executive 

Order 13496 of January 30, 2009, or by rule, 

regulation, or order of the Secretary of Labor, 

or as are otherwise provided by law. 

‘‘4. The contractor will include the 

provisions of paragraphs (1) through (4) 

herein in every subcontract or purchase order 

entered into in connection with this contract 

(unless exempted by rules, regulations, or 

orders of the Secretary of Labor issued 

pursuant to Section 3 of Executive Order 

13496 of January 30, 2009), so that such 

provisions will be binding upon each 

subcontractor. The contractor will take such 

action with respect to any such subcontract 

or purchase order as may be directed by the 

Secretary of Labor as a means of enforcing 

such provisions, including the imposition of 

sanctions for non-compliance: Provided, 

however, if the contractor becomes involved 

in litigation with a subcontractor, or is 

threatened with such involvement, as a result 

of such direction, the contractor may request 

the United States to enter into such litigation 

to protect the interests of the United States.’’ 

Subpart B—General Enforcement; 

Compliance Review and Complaint 

Procedures 

§ 471.10 How will the Department 

determine whether a contractor is in 

compliance with Executive Order 13496 and 

this part? 

(a) The Director of OFCCP may 

conduct a compliance evaluation to 

determine whether a contractor holding 

a covered contract is in compliance with 

the requirements of this part. Such an 

evaluation may be limited to 

compliance with this part or may be 

included in a compliance evaluation 

conducted under other laws, Executive 

Orders, and/or regulations enforced by 

the Department. 

(b) During such an evaluation, a 

determination will be made whether: 

(1) The employee notice required by 

§ 471.2(a) is posted in conformity with 

the applicable physical and electronic 

posting requirements contained in 

§ 471.2(d) and (f); and 

(2) The provisions of the employee 

notice clause are included in 

government contracts, subcontracts or 

purchase orders entered into on or after 

June 21, 2010, or that the government 

contracts, subcontracts or purchase 

orders have been exempted under 

§ 471.3(b). 

(c) The results of the evaluation will 

be documented in the evaluation record, 

which will include findings regarding 

the contractor’s compliance with the 

requirements of the Executive Order and 

this part and, as applicable, conciliation 

efforts made, corrective action taken 

and/or enforcement recommended 

under § 471.13. 

§ 471.11 What are the procedures for filing 

and processing a complaint? 

(a) Filing complaints. An employee of 

a covered contractor may file a 

complaint alleging that the contractor 

has failed to post the employee notice 

as required by the Executive Order and 

this part; and/or has failed to include 

the employee notice clause in 

subcontracts or purchase orders. 

Complaints may be filed with the Office 

of Labor-Management Standards 

(OLMS) or the Office of Federal Contract 

Compliance Programs (OFCCP) at 200 

Constitution Avenue, NW., Washington, 

DC 20210, or with any OLMS or OFCCP 

field office. 

(b) Contents of complaints. The 

complaint must be in writing and must 

include: 

(1) The employee’s name, address, 

and telephone number; 

(2) The name and address of the 

contractor alleged to have violated the 

Executive Order and this part; 


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(3) An identification of the alleged 

violation and the establishment or 

construction work site where it is 

alleged to have occurred; 

(4) Any other pertinent information 

that will assist in the investigation and 

resolution of the complaint; and 

(5) The signature of the employee 

filing the complaint. 

(c) Complaint investigations. In 

investigating complaints filed with the 

Department under this section, the 

Director of OFCCP will evaluate the 

allegations of the complaint and 

develop a case record. The record will 

include findings regarding the 

contractor’s compliance with the 

requirements of the Executive Order and 

this part, and, as applicable, a 

description of conciliation efforts made, 

corrective action taken, and/or 

enforcement recommended. 

§ 471.12 What are the procedures to be 

followed when a violation is found during a 

complaint investigation or compliance 

evaluation? 

(a) If any complaint investigation or 

compliance evaluation indicates a 

violation of the Executive Order or this 

part, the Director of OFCCP will make 

reasonable efforts to secure compliance 

through conciliation. 

(b) Before the contractor may be found 

to be in compliance with the Executive 

Order or this part, the contractor must 

correct the violation found by the 

Department (for example, by posting the 

required employee notice, and/or by 

amending its subcontracts or purchase 

orders with subcontractors to include 

the employee notice clause), and must 

commit, in writing, not to repeat the 

violation. 

(c) If a violation cannot be resolved 

through conciliation efforts, the Director 

of OFCCP will refer the matter to the 

Director of OLMS, who may take action 

under § 471.13. 

(d) For reasonable cause shown, the 

Director of OLMS may reconsider, or 

cause to be reconsidered, any matter on 

his or her own motion or in response to 

a request. 

§ 471.13 Under what circumstances, and 

how, will enforcement proceedings under 

Executive Order 13496 be conducted? 

(a) General. (1) Violations of the 

Executive Order or this part may result 

in administrative enforcement 

proceedings. The bases for a finding of 

a violation may include, but are not 

limited to: 

(i) The results of a compliance 

evaluation; 

(ii) The results of a complaint 

investigation; 

(iii) A contractor’s refusal to allow a 

compliance evaluation or complaint 

investigation to be conducted; or 

(iv) A contractor’s refusal to cooperate 

with the compliance evaluation or 

complaint investigation, including 

failure to provide information sought 

during those procedures. 

(v) A contractor’s refusal to take such 

action with respect to a subcontract as 

directed by the Director of OFCCP or the 

Director of OLMS as a means of 

enforcing compliance with the 

provisions of this part. 

(vi) A subcontractor’s refusal to 

adhere to requirements of this part 

regarding employee notice or inclusion 

of the contract clause in its 

subcontracts. 

(2) If a determination is made by the 

Director of OFCCP that the Executive 

Order or the regulations in this part 

have been violated, and the violation 

has not been corrected through 

conciliation, he or she will refer the 

matter to the Director of OLMS for 

enforcement consideration. The Director 

of OLMS may refer the matter to the 

Solicitor of Labor to begin 

administrative enforcement 

proceedings. 

(b) Administrative enforcement 

proceedings. (1) Administrative 

enforcement proceedings will be 

conducted under the control and 

supervision of the Solicitor of Labor, 

under the hearing procedures in 29 CFR 

part 18, Rules of Practice and Procedure 

for Administrative Hearings Before the 

Office of Administrative Law Judges. 

(2) The administrative law judge will 

certify his or her recommended decision 

issued under 29 CFR 18.57 to the 

Administrative Review Board. The 

decision will be served on all parties 

and amicus curiae. 

(3) Within 25 days (10 days if the 

proceeding is expedited) after receipt of 

the administrative law judge’s 

recommended decision, either party 

may file exceptions to the decision. 

Exceptions may be responded to by the 

other parties within 25 days (7 days if 

the proceeding is expedited) after 

receipt. All exceptions and responses 

must be filed with the Administrative 

Review Board. 

(4) After the expiration of time for 

filing exceptions, the Administrative 

Review Board may issue a final 

administrative order, or may otherwise 

appropriately dispose of the matter. In 

an expedited proceeding, unless the 

Administrative Review Board issues a 

final administrative order within 30 

days after the expiration of time for 

filing exceptions, the administrative law 

judge’s recommended decision will 

become the final administrative order. If 

the Administrative Review Board 

determines that the contractor has 

violated the Executive Order or the 

regulations in this part, the final 

administrative order will order the 

contractor to cease and desist from the 

violations, require the contractor to 

provide appropriate remedies, or, 

subject to the procedures in § 471.14, 

impose appropriate sanctions and 

penalties, or any combination thereof. 

§ 471.14 What sanctions and penalties 

may be imposed for noncompliance, and 

what procedures will the Department follow 

in imposing such sanctions and penalties? 

(a) After a final decision on the merits 

has issued and before imposing the 

sanctions and penalties described in 

paragraph (d) of this section, the 

Director of OLMS will consult with the 

affected contracting agencies, and 

provide the heads of those agencies the 

opportunity to respond and provide 

written objections. 

(b) If the contracting agency provides 

written objections, those objections 

must include a complete statement of 

reasons for the objections, which must 

include a finding that, as applicable, the 

completion of the contract, or further 

contracts or extensions or modifications 

of existing contracts, is essential to the 

agency’s mission. 

(c) The sanctions and penalties 

described in this section will not be 

imposed if: 

(1) The head of the contracting 

agency, or his or her designee, continues 

to object to the imposition of such 

sanctions and penalties, or 

(2) The contractor has not been given 

an opportunity for a hearing. 

(d) In enforcing the Executive Order 

and this part, the Director of OLMS may 

take any of the following actions: 

(1) Direct a contracting agency to 

cancel, terminate, suspend, or cause to 

be canceled, terminated or suspended, 

any contract or any portions thereof, for 

failure to comply with its contractual 

provisions required by Section 7(a) of 

the Executive Order and the regulations 

in this part. Contracts may be canceled, 

terminated, or suspended absolutely, or 

continuance of contracts may be 

conditioned upon compliance. 

(2) Issue an order of debarment under 

Section 7(b) of the Executive Order 

providing that one or more contracting 

agencies must refrain from entering into 

further contracts, or extensions or other 

modification of existing contracts, with 

any non-complying contractor. 

(3) Issue an order of debarment under 

Section 7(b) of the Executive Order 

providing that no contracting agency 

may enter into a contract with any noncomplying subcontractor. 


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(e) Whenever the Director of OLMS 

exercises the authority in this section, 

the contracting agency must report the 

actions it has taken to the Director of 

OLMS within such time as the Director 

of OLMS will specify. 

(f) Periodically, the Director of OLMS 

will publish and distribute to all 

executive agencies a list of the names of 

contractors and subcontractors that 

have, in the judgment of the Director of 

OLMS, failed to comply with the 

provisions of the Executive Order and 

this part, or of related rules, regulations, 

and orders of the Secretary of Labor, and 

as a result have been declared ineligible 

for future contracts under the Executive 

Order and the regulations in this part. 

§ 471.15 Under what circumstances must a 

contractor be provided the opportunity for 

a hearing? 

Before the Director of OLMS takes 

either of the following actions, a 

contractor or subcontractor must be 

given the opportunity for a hearing: 

(a) Issues an order for cancellation, 

termination, or suspension of any 

contract or debarment of any contractor 

from further Government contracts 

under Sections 7(a) or (b) of the 

Executive Order and § 471.14(d)(1) or 

(2) of this part; or 

(b) Includes the contractor on a 

published list of non-complying 

contractors under Section 7(c) of the 

Executive Order and § 471.14(f) of this 

part. 

§ 471.16 Under what circumstances may a 

contractor be reinstated? 

Any contractor or subcontractor 

debarred from or declared ineligible for 

further contracts under the Executive 

Order and this part may request 

reinstatement in a letter to the Director 

of OLMS. In connection with a request 

for reinstatement, debarred contractors 

and subcontractors shall be required to 

show that they have established and 

will carry out policies and practices in 

compliance with the Executive Order 

and implementing regulations. Before 

reaching a decision, the Director of 

OLMS may request that a compliance 

evaluation of the contractor or 

subcontractor be conducted, and may 

require the contractor or subcontractor 

to supply additional information 

regarding the request for reinstatement. 

If the Director of OLMS finds that the 

contractor or subcontractor has come 

into compliance with the Executive 

Order and this part and has shown that 

it will carry out the Executive Order and 

this part, the contractor or subcontractor 

may be reinstated. The Director of 

OLMS shall issue a written decision on 

the request. 

Subpart C—Ancillary Matters 

§ 471.20 What authority under this part or 

Executive Order 13496 may the Secretary 

delegate, and under what circumstances? 

Section 11 of the Executive Order 

grants the Secretary the right to delegate 

any functions or duties under the Order 

to any officer in the Department of 

Labor or to any other officer in the 

executive branch of the Government, 

with the consent of the head of the 

department or agency in which that 

officer serves. 

§ 471.21 Who will make rulings and 

interpretations under Executive Order 

13496 and this part? 

The Director of OLMS and the 

Director of OFCCP will make rulings 

under or interpretations of the Executive 

Order or the regulations contained in 

this part in accordance with their 

respective responsibilities under the 

regulations. Requests for a ruling or 

interpretation must be submitted to the 

Director of OLMS, who will consult 

with the Director of OFCCP to the extent 

necessary and appropriate to issue such 

ruling or interpretation. 

§ 471.22 What actions may the Director of 

OLMS take in the case of intimidation and 

interference? 

The Director of OLMS may impose 

the sanctions and penalties contained in 

§ 471.14 of this part against any 

contractor or subcontractor who does 

not take all necessary steps to ensure 

that no person intimidates, threatens, or 

coerces any individual for the purpose 

of interfering with the filing of a 

complaint, furnishing information, or 

assisting or participating in any manner 

in a compliance evaluation, complaint 

investigation, hearing, or any other 

activity related to the administration or 

enforcement of the Executive Order or 

this part. 

§ 471.23 What other provisions apply to 

this part? 

(a) The regulations in this part 

implement only the Executive Order, 

and do not modify or affect the 

interpretation of any other Department 

of Labor regulations or policy. 

(b) Each contracting department and 

agency must cooperate with the Director 

of OLMS and the Director of the OFCCP, 

and must provide any information and 

assistance that they may require, in the 

performance of their functions under 

the Executive Order and the regulations 

in this part. 

(c)(1) This subpart does not impair or 

otherwise affect: 

(i) Authority granted by law to a 

department, agency, or the head thereof; 

or 

(ii) Functions of the Director of the 

Office of Management and Budget 

relating to budgetary, administrative, or 

legislative proposals. 

(2) This subpart must be implemented 

consistent with applicable law and 

subject to the availability of 

appropriations. 

(d) Neither the Executive Order nor 

this part creates any right or benefit, 

substantive or procedural, enforceable at 

law or in equity by any party against the 

United States, its departments, agencies, 

or entities, its officers, employees, or 

agents, or any other person. 

Signed in Washington, DC, May 7, 2010. 

John Lund, 

Director, Office of Labor-Management 

Standards. 

Patricia A. Shiu, 

Director, Office of Federal Contract 

Compliance Programs. 

[FR Doc. 2010–11639 Filed 5–19–10; 8:45 am] 

BILLING CODE 4510–CP–P 


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