Republican lawmakers acted to formally undo one of former President Barack Obama's efforts to tighten labor regulations, with the House voting 236-87 Thursday on a resolution to undo an executive order that effectively created a blacklist for federal contractors that had been charged with labor violations.
The executive order was halted by a federal court in November, when a judge ruled that the Labor Department had exceeded its authority. It was a preliminary injunction, however, so the House voted on undoing it using the Congressional Review Act, which allows a majority in Congress to overturn an executive order.
Republicans said the rule was simply another burdensome regulation and argued that existing rules already gave the government significant oversight. "The rule imposes significant costs on contractors, which means signficant costs for the government, which means the taxpayers," said Rep. Jason Chaffetz, R-Utah, chairman of the House Oversight and Government Reform Committee.
Rep. Virginia Foxx, R-Va., chairwoman of the Education and the Workforce Committee, said the rule was structured to make contractors were guilty until proven innocent. The real purpose of it, she said, was to benefit "big labor" by making filing "frivolous complaints" against employers a more powerful tool.
Democrats countered that removing the rule merely rewarded "bad actors" at the expense of the conscientious contractors. "Tax dollars should not go to contractors that continually and willfully violate the rules," said Rep. Elijah Cummings of Maryland, the top Democrat on the oversight committee.
The vote was eagerly watched by business groups. The Chamber of Commerce said Thursday that the executive order was "seriously problematic, burdensome and unwarranted" and that it would count voting to undo it as a "key vote" in how it evaluates lawmakers. The National Association of Manufacturers issued a similar announcement.
The contracting rule, announced by the Labor Department in May, was issued in response to a 2014 executive order from Obama to "promote economy and efficiency in procurement by contracting with responsible sources who comply with labor laws."
The rule requires any company bidding on a contract larger than $500,000 to report any violations within the last three years of 14 federal labor and safety laws, as well as violations of any equivalent state laws. If the company wins the contract, it must make follow-up reports at six-month intervals until the contract is completed.
The rule extends disclosure to any "administrative merits determinations," that is, any complaints or charges issued against the company by a government agency "whether final or subject to appeal or further review."
"Because of any contractor's desire to remain eligible, enforcement agencies will have extraordinary leverage to extract agency-favorable 'labor compliance agreements' from contractors to resolve violations, even before the contractors will have had a chance to present their defense," said Jack Howard, the Chamber's senior vice president of congressional and public affairs.
Texas District Court Judge Marcia Crone agreed with that thinking, ruling in November that the White House had "departed from Congress's explicit instructions" regarding federal contracting. She said the administration's rule would treat "mere allegations of misconduct as violations of federal law, threatening to deprive contractors of their due process rights." Business groups cheered the ruling.