Another big win for conservatives as President Obama repealed an Obama era rule that gave labor unions preferential treatment in getting federal contracts.
Earlier this month Congress passed a bill rescinding Obama’s labor ruled, which would have forced every company applying for a federal contract to report all allegations of unfair labor practices filed against them. The rule would have cost companies almost $455 million in the first year alone, Senator Lamar Alexander (R-TN) argued that “the harmful Obama administration ‘blacklisting’ regulation … could have prevented our nation’s federal contractors from receiving a federal contract for an alleged labor violation before any wrongdoing has been proven.”
Labor law experts argued that the Obama rule would give labor unions “unprecedented” power.
Veteran union attorney Robert Schwartz wrote in a blog post that it provided “unions unprecedented new leverage against companies” because they could potentially derail contract opportunities with an allegation no matter how specious. Trey Kovacs, a labor law expert at the pro-free market Competitive Enterprise Institute, agreed with Schwartz’s analysis.
“The rule may provide incentive to labor unions, attempting to organize a workplace, to file frivolous labor-related charges against companies that bid on federal contractors in order to extract favorable union election conditions,” he said in a post.
Thankfully, Congress acted quickly to rescind the rule and President Trump moved just as swiftly to sign the new law giving equal footing to all companies.
“Congress has taken an important step in removing burdensome and duplicative reporting requirements and eliminating a costly barrier to entry that would have discouraged many small contractors from bidding on government contracts,” Associated Builders and Contractors spokesman Ben Brubeck said.
Congresswoman Virginia Foxx (R-NC) praised Trump for “rejecting this misguided approach.” Foxx said in a statement that “this duplicative rule would have served only to empower union bosses. There has long been a system in place to hold federal contractors accountable, and the best way to ensure fair pay and safe workplaces is to enforce that system effectively.”
If the law had not passed, the rule may have been in trouble anyway, as several legal challenges had already begun winding their way through out legal system.
Several private sector companies and industry associations challenged the rule in federal court, leading Dederal Judge Marcia A. Crone to issue a temporary injunction against its implementation in October. Associated Builders & Contractors, which filed the suit, praised Trump for eliminating the rule.
“The rule violated the due process rights of contractors by forcing them to report mere allegations of misconduct—which are often frivolous and filed with nefarious intentions by special interest groups—the same as fully adjudicated violations,” ABC spokesman Ben Brubeck said in a statement. “ABC is committed to working with the Trump administration and Congress to improve the government’s current procurement system to ensure that taxpayer-funded projects are awarded through a transparent and fair bid process.”
Thankfully, we won’t need the courts to weigh in on this unfair Obama practice because Congress did it’s job and repealed the unfair anti-free market rule.