President Obama has issued Executive Order 13706, Establishing Paid Sick Leave for Federal Contractors. The EO ensures contractor employees can earn up to 7 days or more of paid sick leave annually. The new policy brings contractor employee benefits in line with those of federal workers and model employers to ensure that government contractors remain competitive in terms of attracting and retaining a dedicated and talented workforce.
A new contract clause, which must be flowed down to subcontractors, will require that contractor employees earn at least 1 hour of paid sick leave for every 30 hours worked. The EO also includes the following key provisions:
- contractors may not limit accrued paid sick leave to less than 56 hours per year;
- accrued sick leave can be carried over from year to year;
- sick leave will be reinstated for employees that leave and are rehired within 12 months; and
- sick leave may be used for a variety of circumstances, including: physical or mental illness or treatment; medical testing and preventative care; care of a child, spouse, domestic partner or other close relative; and matters related to domestic violence, sexual assault or stalking.
In terms of regulations and enforcement, the FAR Council is tasked to issue regulations to implement the EO, which applies to all covered contracts resulting from solicitations issued on or after January 1, 2017. The E.O. also specifies that disputes regarding compliance are not subject to the Contract Disputes Act, and “shall be disposed of” as provided in regulations to be prescribed by the Secretary of Labor.