The Obama administration’s move to crack down on federal contractors who violate labor laws and to ensure that employees of contractors retain their access to court for certain disputes has won approval from Public Citizen, a nonpartisan public advocacy group.

The administration released guidance and a notice of rulemaking to implement a 2014 executive order issued by the president to ensure that federal contractors maintain fair, safe and just workplaces.

The U.S. Department of Labor (DOL) guidance and rulemaking under the Federal Acquisition Regulation will improve critical workplace protections and level the playing field for law-abiding businesses because the specific requirements will help deter employer misconduct, Public Citizen said.

Contractors will not simply be able to pay a fine

“The DOL guidance suggests that there will be deeper implications for employers who violate labor laws, particularly the Occupational Safety and Health Act,” said Keith Wrightson, worker safety advocate for Public Citizen’s Congress Watch division. “Contractors who are working on federally funded projects will not simply be able to pay a fine and continue to violate the law. Those violations will now be a factor in whether or not the federal government continues to do business with them, and rightly so.”

Among other worker rights assurances, the executive order prohibits federal contractors with contracts estimated to exceed $1 million from using the fine print of their employment contracts to force employees to settle employment disputes in a private arbitration system. Now, federal contractor employees with certain civil rights, harassment and sexual assault claims can choose to go to court after disputes with their employers arise. The executive order is similar to a U.S. Department of Defense rule for defense contractors.

About forced arbitration

Forced arbitration clauses are used increasingly in employment contracts, preventing serious claims of employee harm – such as discrimination, unfair wages and other violations of federal and state labor laws – from being heard in open court. Today’s rulemaking notice rightfully noted the real public benefit of giving employers incentive to treat workers fairly: “Increased risk of public exposure, class-action suits and higher damages awards provides [sic] an incentive for employers to comply with anti-discrimination laws that arbitration cannot match.”

“As we said when the president issued the executive order, access to justice is a fundamental American right that should not be discarded in the fine print of employment contracts,” said Christine Hines, consumer and civil justice counsel for Public Citizen’s Congress Watch division. “This rule will restore worker rights to a certain extent when it comes to employer misconduct. It is up to Congress to pass a law, the Arbitration Fairness Act, to make arbitration voluntary for all individuals and give them the right to seek remedies in court for all consumer, employment and civil rights disputes.”

“The president has used the duly granted powers of the executive branch to make positive change for government employees. As it has successfully implemented this executive order, the administration also should issue an executive order to improve the efficiency of the contracting process by dealing with the appearance of corruption, and require disclosure of political spending for government contractors,” said Lisa Gilbert, director of Public Citizen’s Congress Watch division. “The president continues to use his authority well, and this is another important reform we hope to soon see.”