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New Executive Order August 3, 2020 – Hiring Practices of Employers with Federal Contracts or Sub-Contracts Under Scrutiny

The Order:

Citing economic dislocation caused by COVID-19, the president today ordered each executive department and agency to review the performance of contracts, including subcontracts, awarded in fiscal years 2018 and 2019 to assess:

  1. Whether contractors used temporary foreign labor for work performed in the U.S., and if so, the nature of the work performed, whether opportunities for U.S. workers were affected, and any potential effects on national security;
  2. Whether contractors performed work in foreign countries that was previously performed in the U.S., and, if so, whether opportunities for U.S. workers were affected, whether affected U.S. workers were eligible for assistance under the Trade Adjustment Assistance program authorized by the Trade Act of 1974; and any potential effects on national security

Each agency is also to determine whether the hiring of temporary foreign labor or offshoring of work negatively impacted the economy and efficiency of federal procurement or national security, and propose action to improve the economy and efficiency federal procurement, and protect national security

The head of each agency, in coordination with the Director of the Office of Personnel Management, is to review its employment policies to assess the agency’s compliance with Executive Order 11935 of September 2, 1976 (Citizenship Requirements for Federal Employment), and section 704 of the Consolidated Appropriations Act, 2020, Public Law 116-93.

Within 45 days of the date of the order, the Secretaries of Labor and Homeland Security are to take action to protect U.S. workers from any adverse effects on wages and working conditions caused by the employment of H-1B visa holders at job sites (including third-party job sites), including measures to ensure that all employers of H-1B visa holders, including secondary employers, adhere to the requirements of section 212(n)(1) of the Immigration and Nationality Act (8 U.S.C. 1182(n)(1)).

Assessment of the order:

It is important to know that the existing law requires each H-1B employer to attest for each H-1B worker:

  1. The employer shall pay the higher of either the prevailing wage or the actual wage paid to workers in the same occupation, including for non-productive time; they shall offer nonimmigrant workers benefits and eligibility for benefits provided as compensation for services on the same basis as offered to U.S. workers;
  2. The employer shall provide working conditions for nonimmigrants which will not adversely affect the working conditions of workers similarly employed;
  3. No strike, lockout, or work stoppage in the course of a labor dispute in the occupational classification in the geographic area of intended employment exists, and the employer will notify the Department of Labor within 3 days of the occurrence of a strike or lockout in the occupation;
  4. Notice of the intent to hire the foreign national was provided to the bargaining representative or to workers in the occupation at the place of employment.

The Department of Labor must certify those attestations and the wage for that occupation in that geographic location on the Labor Condition Application prior to any H-1B petition being filed.

What This Order Means to Employers (and What Employers Should Consider)

Because the order restates existing law, it may be intended to signal that the executive branch is redoubling its efforts to monitor and enforce the rules.  As such, any employer with temporary foreign workers may want to contact us to conduct our own internal review to ensure they are in compliance, knowing the government is in the process of assessing the same themselves, particularly for those employers with federal contracts or subcontracts.

For further discussion or assistance, contact Barbara A. Marcouiller at bmarcouiller@PRKlaw.com.

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