Patriotic Corporations of America Act of 2021
Bill: H.R.4186 | Sponsor: Rep. Schakowsky, Janice D. (D-IL)
Policy area: Government Operations and Politics

Summary:
Patriotic Corporations of America Act of 2021
This bill establishes new requirements for federal contracts, including Department of Defense contracts, with respect to issues of labor, environmental sustainability, taxes, and private equity firms.
Specifically, the bill prohibits an executive agency from awarding a contract unless the offeror, among other requirements
The bill sets forth additional provisions to assure that the offeror meets specified requirements with respect to the payment of environmental penalties, federal income tax liability and financial performance, and a controlling private equity firm meeting certain labor and environmental requirements.
The bill establishes specified contract preferences (e.g., in favor of an offeror that does not outsource jobs outside the United States and that has a collective bargaining agreement with employees).

To amend titles 41 and 10, United States Code, to include new 
      requirements for Federal contracts, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Patriotic Corporations of America 
Act of 2021''.

SEC. 2. FEDERAL PROCUREMENT REQUIREMENTS AND PREFERENCES.

    (a) Amendment.--Chapter 47 of division C of subtitle I of title 41, 
United States Code, is amended by adding at the end the following new 
sections:
``Sec. 4715. Requirements for offerors
    ``(a) Labor.--The head of an executive agency may not award a 
contract unless the following requirements are met:
            ``(1) The offeror agrees for the duration of the contract 
        to pay each employee of the offeror a wage of not less than the 
        greater of--
                    ``(A) $15, increased on an annual basis from such 
                amount by the annual percentage increase, if any, in 
                the median hourly wage of all employees as determined 
                by the Bureau of Labor Statistics; or
                    ``(B) the amount equal to the sum of--
                            ``(i) the wage rate in effect under section 
                        6(a)(1) of the Fair Labor Standards Act of 1938 
                        (29 U.S.C. 206(a)(1)); and
                            ``(ii) the amount that is 10 percent of 
                        such wage rate.
            ``(2) The offeror agrees to sign--
                    ``(A) a neutrality agreement, effective during the 
                period of the contract, with respect to efforts to form 
                a labor organization (as defined in section 2 of the 
                National Labor Relations Act (29 U.S.C. 152)); and
                    ``(B) an agreement, effective during the period of 
                the contract, not to hire employees to replace any 
                employee engaged in any strike, picketing, or other 
                concerted refusal to work or to close a business in 
                response to such a strike, picketing, or other refusal 
                to work.
            ``(3) The head of the executive agency, in consultation 
        with the National Labor Relations Board, determines that the 
        offeror has not been found in violation or settled a claim for 
        a violation of the right of an employee to organize under a 
        law, including regulations thereof, administered by the 
        National Labor Relations Board, or of a State regulation 
        determined relevant by the head of the executive agency, in 
        consultation with the Secretary of Labor.
            ``(4) The offeror provides each employee at least 7 days of 
        paid sick leave, 7 days of paid family and medical leave, and 7 
        days of paid vacation per year.
            ``(5) No assessable payment has been imposed, with respect 
        to the offeror, under section 4980H of the Internal Revenue 
        Code of 1986, with respect to any of the 12 months ending 
        before the date on which the contract is awarded.
            ``(6) The offeror submits to the head of the executive 
        agency an actionable plan to address natural disasters and 
        health crises, including policies and plans for--
                    ``(A) the determination of essential employees;
                    ``(B) increased essential employee pay and 
                quarantine pay;
                    ``(C) paid family and medical leave;
                    ``(D) temporary layoffs;
                    ``(E) whistleblower protections; and
                    ``(F) emergencies in the case of rapidly changing 
                circumstances.
            ``(7) The offerer submits to the head of the executive 
        agency an actionable plan to recruit and promote people of 
        color, women, LGBTQ+ people, people with disabilities, and 
        veterans.
    ``(b) Environmental Sustainability.--The head of an executive 
agency may not award a contract unless the head of the executive 
agency, in consultation with the Administrator of the Environmental 
Protection Agency, determines that the offeror has not, within the 
previous 5 years--
            ``(1) paid a penalty that is greater than $100,000 for a 
        violation of a law, including regulations thereof, administered 
        by Environmental Protection Agency; or
            ``(2) settled a claim in connection with such a violation 
        for an amount that is greater than $100,000.
    ``(c) Taxes.--The head of an executive agency may not award a 
contract unless the offeror--
            ``(1) maintains headquarters in the United States;
            ``(2) has Federal income tax liability which exceeds the 
        offeror's Federal income tax credits (other than such credits 
        which constitute cash payments of tax by the offeror);
            ``(3) is neither an expatriated entity (as defined in 
        subparagraph (A) of section 7874(a)(2) of the Internal Revenue 
        Code of 1986) nor a surrogate foreign corporation (as defined 
        in subparagraph (B) of such section); and
            ``(4) discloses financial performance and tax information 
        on a country-by-country basis.
    ``(d) Private Equity Firm Applicability.--In the case that a 
private equity firm holds a controlling interest in an offeror, if the 
head of an executive agency determines, in consultation with the 
Secretary of Labor, the National Labor Relations Board, and the 
Administrator of the Environmental Protection Agency, that one company 
in which the private equity firm has a controlling interest violated 
subsection (a)(3) or (b), such head shall bar any company in which the 
private equity firm had a controlling interest at the time of violation 
from participation in a Federal contract for a period of 5 years.
    ``(e) Employee Defined.--For the purposes of this section, the term 
`employee' includes an independent contractor.
``Sec. 4716. Contract preferences
    ``(a) In General.--There shall be a contract preference for an 
offeror that meets any of the following qualifications:
            ``(1) The offeror does not have a pay ratio of more than 
        100 to 1.
            ``(2) The offeror does not outsource jobs outside of the 
        United States.
            ``(3) If the offeror has a Board of Directors, the offeror 
        has at least one seat on such Board of Directors for a 
        representative elected by the employees.
            ``(4) The offeror contributes at least 5 percent of the 
        payroll to a portable pension fund for the employees.
            ``(5) The offeror provides at least 2 percent of stock to 
        their employees every year until the company is at least 20 
        percent owned by employees.
            ``(6) The offeror has a collective bargaining agreement 
        with employees.
            ``(7) Women and people of color make up at least 40 percent 
        of top executives and, if the offeror has a Board of Directors, 
        of the members of such Board.
            ``(8) The offeror publicly discloses workforce gender and 
        racial composition and pay gaps.
            ``(9) The offeror provides an affirmative action program 
        (as defined in section 30.4 of title 29, Code of Federal 
        Regulations, or a successor regulation) to ensure equal 
        opportunity in apprenticeships.
            ``(10) The offeror documents that they have assisted each 
        individual with an intellectual or developmental disability and 
        other individual with a significant disability employed by the 
        employer under an certificate under section 14(c) of the Fair 
        Labor Standards Act (29 U.S.C. 214(c)) to transition to 
        opportunities for competitive integrated employment and that 
        such individuals are employed in such opportunities for not 
        less than 20 hours per week, on average.
    ``(b) Application of Preference.--The head of an executive agency 
shall apply subsection (a) by providing greater preference to an 
offeror that meets a greater number of the qualifications under 
paragraphs (1) through (10) of such subsection.
    ``(c) Definitions.--For the purposes of this section--
            ``(1) the terms `developmental disability' and `integrated' 
        have the meaning given the terms in section 102 of the 
        Developmental Disabilities Assistance and Bill of Rights Act of 
        2000 (42 U.S.C. 15002);
            ``(2) the term `employee' includes an independent 
        contractor; and
            ``(3) the term `pay ratio' means the ratio described in 
        section 229.402(u)(1)(iii) of title 17, Code of Federal 
        Regulations (or any successor regulation), except that if the 
        highest compensated employee of the corporation is not the 
        principal executive officer, the ratio shall be determined 
        based on the compensation of such highest compensated 
        employee.''.
    (b) Technical and Conforming Amendment.--The table of sections for 
chapter 47 of division C of subtitle I of title 41, United States Code, 
is amended by adding at the end the following new items:

        ``4715. Requirements for offerors.
        ``4716. Contract preferences.''.
    (c) Applicability.--The amendments made by this section shall apply 
to any Federal contract entered into on or after the date of the 
enactment of this Act.

SEC. 3. DEPARTMENT OF DEFENSE CONTRACTS.

    (a) Additional Requirements for Department of Defense Contracts.--
            (1) In general.--Chapter 241 of title 10, United States 
        Code (as added by section 1816 of the William M. (Mac) 
        Thornberry National Defense Authorization Act for Fiscal Year 
        2021 (Public Law 116-283)), is amended by adding at the end the 
        following new section:
``Sec. 3310. Additional requirements for Department of Defense 
              contracts
    ``(a) Labor.--The Secretary of Defense may not award a contract 
unless the following requirements are met:
            ``(1) The offeror agrees for the duration of the contract 
        to pay each employee of the offeror a wage of not less than the 
        greater of--
                    ``(A) $15, increased on an annual basis from such 
                amount by the annual percentage increase, if any, in 
                the median hourly wage of all employees as determined 
                by the Bureau of Labor Statistics; or
                    ``(B) the amount equal to the sum of--
                            ``(i) the wage rate in effect under section 
                        6(a)(1) of the Fair Labor Standards Act of 1938 
                        (29 U.S.C. 206(a)(1)); and
                            ``(ii) the amount that is 10 percent of 
                        such wage rate.
            ``(2) The offeror agrees to sign--
                    ``(A) a neutrality agreement, effective during the 
                period of the contract, with respect to efforts to form 
                a labor organization (as defined in section 2 of the 
                National Labor Relations Act (29 U.S.C. 152)); and
                    ``(B) an agreement, effective during the period of 
                the contract, not to hire employees to replace any 
                employee engaged in any strike, picketing, or other 
                concerted refusal to work or to close a business in 
                response to such a strike, picketing, or other refusal 
                to work.
            ``(3) The Secretary of Defense, in consultation with the 
        National Labor Relations Board, determines that the offeror has 
        not been found in violation or settled a claim for a violation 
        of the right of an employee to organize under a law, including 
        regulations thereof, administered by the National Labor 
        Relations Board, or of a State regulation determined relevant 
        by the Secretary of Defense, in consultation with the Secretary 
        of Labor.
            ``(4) The offeror provides each employee at least seven 
        days of paid sick leave, seven days of paid family and medical 
        leave, and seven days of paid vacation per year.
            ``(5) No assessable payment has been imposed, with respect 
        to the offeror, under section 4980H of the Internal Revenue 
        Code of 1986, with respect to any of the 12 months ending 
        before the date on which the contract is awarded.
            ``(6) The offeror submits to the Secretary of Defense an 
        actionable plan to address natural disasters and health crises, 
        including policies and plans for--
                    ``(A) the determination of essential employees;
                    ``(B) increased essential employee pay and 
                quarantine pay;
                    ``(C) paid family and medical leave;
                    ``(D) temporary layoffs;
                    ``(E) whistleblower protections; and
                    ``(F) emergencies in the case of rapidly changing 
                circumstances.
            ``(7) The offerer submits to the Secretary of Defense an 
        actionable plan to recruit and promote people of color, women, 
        LGBTQ+ people, people with disabilities, and veterans.
    ``(b) Environmental Sustainability.--The Secretary of Defense may 
not award a contract unless the Secretary, in consultation with the 
Administrator of the Environmental Protection Agency, determines that 
the offeror has not, within the previous 5 years--
            ``(1) paid a penalty that is greater than $100,000 for a 
        violation of a law, including regulations thereof, administered 
        by Environmental Protection Agency; or
            ``(2) settled a claim in connection with such a violation 
        for an amount that is greater than $100,000.
    ``(c) Taxes.--The head of an executive agency may not award a 
contract unless the offeror--
            ``(1) maintains headquarters in the United States;
            ``(2) has Federal income tax liability which exceeds the 
        offeror's Federal income tax credits (other than such credits 
        which constitute cash payments of tax by the offeror);
            ``(3) is neither an expatriated entity (as defined in 
        subparagraph (A) of section 7874(a)(2) of the Internal Revenue 
        Code of 1986) nor a surrogate foreign corporation (as defined 
        in subparagraph (B) of such section); and
            ``(4) discloses financial performance and tax information 
        on a country-by-country basis.
    ``(d) Private Equity Firm Applicability.--In the case that a 
private equity firm holds a controlling interest in an offeror, if the 
Secretary of Defense determines, in consultation with the Secretary of 
Labor, the National Labor Relations Board, and the Administrator of the 
Environmental Protection Agency, that one company in which the private 
equity firm has a controlling interest violated subsection (a)(3) or 
(b), the Secretary shall bar any company in which the private equity 
firm had a controlling interest at the time of violation from 
contracting with the Department of Defense for a period of 5 years.
    ``(e) Employee Defined.--For the purposes of this section, the term 
`employee' includes an independent contractor.''.
            (2) Technical and conforming amendment.--The table of 
        sections at the beginning of such chapter is amended by adding 
        at the end the following new item:

        ``3310. Additional requirements for Department of Defense 
                            contracts.''.
    (b) Preference for Contracts With Certain Labor Requirements.--
            (1) In general.--Chapter 242 of title 10, United States 
        Code (as added by section 1817 of the William M. (Mac) 
        Thornberry National Defense Authorization Act for Fiscal Year 
        2021 (Public Law 116-283)), is amended by adding at the end the 
        following new section:
``Sec. 3325. Preference for contracts from offerors that meet certain 
              labor requirements
    ``(a) In General.--The Secretary of Defense shall establish a 
preference for contracting with an offeror that meets any of the 
following qualifications:
            ``(1) The offeror does not have a pay ratio of more than 
        100 to 1.
            ``(2) The offeror does not outsource jobs outside of the 
        United States.
            ``(3) If the offeror has a Board of Directors, the offeror 
        has at least one seat on such Board of Directors for a 
        representative elected by the employees of the offeror.
            ``(4) The offeror contributes at least 5 percent of the 
        payroll to a portable pension fund for employees of the 
        offeror.
            ``(5) The offeror provides at least 2 percent of stock to 
        employees of the offeror every year until the company is at 
        least 20 percent owned such employees.
            ``(6) The offeror has a collective bargaining agreement 
        with employees of the offeror.
            ``(7) Women and people of color make up at least 40 percent 
        of top executives of the offeror and, if the offeror has a 
        Board of Directors, of the members of such Board.
            ``(8) The offeror publicly discloses the gender and racial 
        composition, and any pay gaps that exist, of the employees of 
        the offeror.
            ``(9) The offeror provides an affirmative action program 
        (as defined in section 30.4 of title 29, Code of Federal 
        Regulations, or a successor regulation) to ensure equal 
        opportunity in apprenticeships.
            ``(10) The offeror documents assistance provided to each 
        individual with an intellectual or developmental disability and 
        any other individual with a significant disability employed by 
        the offeror under an certificate under section 14(c) of the 
        Fair Labor Standards Act (29 U.S.C. 214(c)) to transition to 
        opportunities for competitive integrated employment, and that 
        such individuals are employed in such opportunities for not 
        less than 20 hours per week, on average.
    ``(b) Application of Preference.--The Secretary of Defense shall 
apply subsection (a) by providing greater preference to an offeror that 
meets a greater number of the qualifications under paragraphs (1) 
through (10) of such subsection.
    ``(c) Definitions.--For the purposes of this section--
            ``(1) the terms `developmental disability' and `integrated' 
        have the meaning given the terms in section 102 of the 
        Developmental Disabilities Assistance and Bill of Rights Act of 
        2000 (42 U.S.C. 15002);
            ``(2) the term `employee' includes an independent 
        contractor; and
            ``(3) the term `pay ratio' means the ratio described in 
        section 229.402(u)(1)(iii) of title 17, Code of Federal 
        Regulations (or any successor regulation), except that if the 
        highest compensated employee of the corporation is not the 
        principal executive officer, the ratio shall be determined 
        based on the compensation of such highest compensated 
        employee.''.
            (2) Technical and conforming amendment.--The table of 
        sections for chapter 242 title 10, United States Code, is 
        amended by adding at the end the following new item:

        ``3325. Preference for contracts from offerors that meet 
                            certain labor requirements.''.
    (c) Effective Date.--Sections 3310 and 3325 of title 10, United 
States Code, as added by subsections (a) and (b), respectively, shall 
take effect on January 1, 2022.
    (d) Applicability.--This section and the amendments made by this 
section shall apply to any Federal contract entered into on or after 
the effective date of this section.
    (e) References; Saving Provision; Rule of Construction.--Sections 
1883 through 1885 of the William M. (Mac) Thornberry National Defense 
Authorization Act for Fiscal Year 2021 (Public Law 116-283) shall apply 
with respect to the amendments made by this section as if such 
amendments were made under title XVIII of such Act.
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