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U.S. Department of Labor Publishes Notice of Proposed Rulemaking on Non-Displacement of Qualified Workers Under Service Contracts

The U.S. Department of Labor (DOL) announced publication of a Notice of Proposed Rulemaking (NPRM) to propose regulations to implement Executive Order (EO) 14055, “Non-displacement of Qualified Workers Under Service Contracts.”

The order requires that contractors and subcontractors working on covered federal service contracts (i.e., most SCA-covered contracts over $250,000 or contracts with an executive department or agency, including an independent establishment subject to the Federal Property and Administrative Services Act) must, in good faith, offer service employees employed under the predecessor contract a right of first refusal of employment on the successor contract. Among many benefits, the EO promotes the retention of skilled workers on covered contracts, thereby preventing disruptions in federal services.

The EO and NPRM is expected to benefit taxpayers, contractors, and all service contract workers by:

  • Making federal procurement more efficient by reducing worker turnover and preventing disruptions in federal services;
  • Keeping skilled workers in their jobs;
  • Making it easier for employers to find workers who are already trained for the job;
  • Saving taxpayer dollars by improving the efficiency of federal procurement; and
  • Supporting service sector workers and the work they do for the American people by providing job stability.

Next Steps for Employers

Employers that would like to submit comments may do so by 11:59 p.m. ET on August 15, 2022 at using Regulatory Information Number (RIN) 1235-AA42.

HR Works will continue to monitor this topic and provide updated information as it becomes available.

HR Works, headquartered in Upstate New York, is a human resource management outsourcing and consulting firm serving clients throughout the United States for over thirty years. HR Works provides scalable strategic human resource management and consulting services, including: affirmative action programs; benefits administration outsourcing; HRIS self-service technology; full-time, part-time and interim on-site HR managers; HR audits; legally reviewed employee handbooks and supervisor manuals; talent management and recruiting services; and training of managers and HR professionals.