Capitol Hill

The weight of a regulation
A new wage rule will affect federal contractors

The Obama administration continues its avalanche of regulations placed on contractors who work on federal projects. This year alone, the administration added rules that increase the minimum wage and disclosure of labor violations. And now, a recently finalized rule will require federal contractors to provide paid sick leave to employees.

When the rule first was proposed, NRCA filed detailed comments and asked the proposed rule be withdrawn. NRCA highlighted a number of its members' concerns, including increased labor costs, compliance and paperwork burdens, adding an unknown variable into the bidding process and disruptions in daily operations. The final rule acknowledged a few of NRCA's concerns, but no changes were made. This is not surprising given this rule was a result of an Executive Order issued by President Obama.

The specifics

The rule goes into effect Jan. 1, 2017, and is estimated to provide paid sick leave to 1.1 million workers. NRCA members will be subject to this regulation through procurement contracts for construction on federal properties that adhere to the Davis-Bacon Act. Under this final rule, employees whose wages are determined by the Davis-Bacon Act, including employees who qualify for an exemption from the Fair Labor Standards Act's minimum wage and overtime provisions, will qualify for paid sick leave.