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he98212t - index
Background - he98212t0004
Federal Contractors: Historical Perspective
on Noncompliance With Labor and Worker
Safety Laws
Mr. Chairman and Members of the Subcommittee:
We are pleased to be here today to assist the Subcommittee in its
examination of issues involving federal contractors' noncompliance with
federal labor laws. The consideration of a contractor's compliance with
federal laws during an agency's procurement procedure remains a
controversial issue. In 1995, the administration issued an executive order,
struck down in 1996 by the courts, that barred federal contractors from
receiving contracts if they hire permanent replacements for striking
workers.1 In 1996, the administration issued an executive order that would
bar contractors from hiring illegal immigrants. In early 1997, the
administration had planned to issue an executive order requiring federal
agencies to use Project Labor Agreements on their construction projects.2
After considerable industry opposition, the administration issued an
executive memorandum encouraging, but not requiring, agencies to use
Project Labor Agreements on larger federal construction projects. Some
representatives of the business community have voiced concern that
efforts to encourage federal agencies to consider contractors'
labor-management relations and health and safety records in awarding
contracts could lead to the inappropriate "blacklisting of some employers
as well as inflated procurement costs at the taxpayers' expense.
Today, we would like to shed some light on these issues by presenting
information on the extent to which federal contractors have not complied
with federal labor laws in the past. In particular, I will review our key
findings from recent reports exploring federal contractors' noncompliance
with the National Labor Relations Act (NLRA) during fiscal years 1993 and
1994 and with the Occupational Safety and Health (OSH) Act during fiscal
year 1994.3 Because we have not had an opportunity to update our findings
with data from fiscal year 1995 to the present, we are not in a position to
revise the amount of contract dollars firms in noncompliance currently
receive. I will also review the status of recommendations we made to the
National Labor Relations Board (NLRB) and to the Occupational Safety and
Executive Order 12954, barring federal contractors from hiring permanent replacements, was struck
down by the U.S. Court of Appeals for the District of Columbia.
Project Labor Agreements are a form of pre-hire collective bargaining agreement between
contractors, or owners on behalf of contractors, and labor unions in the construction industry. They
are pre-hire agreements because they can be negotiated before the employees vote on union
representation or before the contractor hires any workers. See Project Labor Agreements: The Extent
of Their Use and Related Information (GAO/GGD-98-82, May 29, 1998).
See Worker Protection: Federal Contractors and Violations of Labor Law (GAO/HEHS-96-8, Oct. 24,
1995) and Occupational Safety and Health: Violations of Safety and Health Regulations by Federal
Contractors (GAO/HEHS-96-157, Aug. 23, 1996). See list of related GAO products at the end of this
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