Via Federal Express (Tracking Number 8278-6288-8281)

RE: Comment on Proposed Rule -- 29 C.F.R. § 470 -- "Obligations of Federal Contractors and  Subcontractors; Notice of Employee Rights Concerning Payment of Union Dues or Fees"

Dear Deputy Assistant Secretary for Labor-Management Programs:

The Department of Labor's (Department) proposed rule, 29 C.F.R. § 470, is excellent. Such important and substantive labor law reform is long overdue, and the National Legal and Policy Center (NLPC), which sponsors the Organized Labor Accountability Project (http://www.nlpc.org), strongly encourages the Department to make this proposed rule a final rule as quickly as possible.

Executive Order 13201, and thus this rule, not only promote economy and efficiency in Government procurement, they also enhance employees' ability to protect their federal rights under the landmark decision of the Supreme Court of the United States: Communications Workers of America v. Beck, 487 U.S. 735 (1988). Advancing Beck rights is good, just, and moral policy. For engaging in such badly needed policy reform, the President of the United States and the Department of Labor must be commended.

The benefits to employees of strong Beck rights are numerous. For example, they enable employees to protect their hard-earned money from union corruption. As the Department is certainly well aware, America is experiencing a rising wave of union corruption (see NLPC's Union Corruption Update on the Internet at http://www.nlpc.org/olap/ucu/index.htm). Thus, any effort to improve the exercise of Beck rights is welcomed.

Likewise, vigorous promotion of Beck rights makes it easier for employees to exercise their First Amendment freedom to fund political candidates and causes of their own choice or none at all.

Additionally, constant exercising of Beck rights makes unions more accountable to the very people who they are supposed to represent. Beck gives individual employees the choice of whether or not to fund a portion of the union's expenditures. This makes the union more responsive to market forces. (Of course a National Right to Work Act would be the ultimate form of making unions responsive to market forces.) That is, if employees believe the union is providing a good service in activities other than collective bargaining, contract administration, and grievance adjustment, then they will be inclined to fully fund the union. Alternatively, if the union continually fails to meet employees needs, employees may choose to withhold the portion of their funds to which they are entitled under Beck. Thus, in this situation, unions have to continually earn the confidence of employees with respect to items outside of collective bargaining, contract administration, and grievance adjustment.

Again, the proposed rule should be made final a soon as possible. While NLPC is very supportive of the Department's action, the rule does have some shortcomings--in some situations it does not go far enough. Therefore, NLPC believes the following specific comments should be incorporated into the final rule so as to improve the rule and further enhance employees' ability to exercise their Beck rights:
 

Section 470.1

1. Organization -- To improve clarity, each of the paragraphs within § 470.1 should have an identifying letter. Such lettering will make it easier to cite § 470.1's definitions in future legal documents. Moreover, three definitions, "Collective Bargaining Agreement," "Government Contract," and "Subcontract," have subparagraphs or subsentences with numbers (i.e., (1), (2)); thus, without adding the suggested lettering, there is potential for confusion. For example, if a future document cites to 29 C.F.R. § 470.1(1), it is unclear to what precisely that citation cites. Alternatively, if, under the suggested lettering, the documents cites to 29 C.F.R. § 470.1(b)(1), it is clear that the citation refers to the first subparagraph under the "Collective Bargaining Agreement" definition. Thus, the following emboldened letters should be added to § 470.1:

(a) Assistant Secretary . . .
(b) Collective Bargaining Agreement . . .
(c) Construction . . .
(d) Construction Work Site . . .
(e) Contract . . .
(f)  Contracting Agency . . .
(g) Contractor . . .
(h)  Department . . .
(i)  Employee Notice Clause
(j)  Government . . .
(k) Government Contract . . .
(l) Labor Organization . . .
(m) Modification of a Contract . . .
(n) Order or Executive Order . . .
(o) Person . . .
(p) Prime Contractor . . .
(q) Related Rules, Regulations, and Orders . . .
(r) Secretary . . .
(s) Subcontract . . .
(t) Subcontractor . . .
(u) Union . . .
(v) Union-Security Agreement . .
(w) United States . . .

3. Definition of Union Security Agreement -- To avoid any unnecessary confusion, the word "fees" should be added to the definition of "Union Security Agreement" as follows:

Union-security agreement means an agreement entered into between a contractor and a labor organization which requires certain employees of the contractor to pay uniform periodic dues and/or fees, initiation fees, or other payments to that labor organization as a condition of employment.

United States as used in this part includes the several States, the District of Columbia, the Virgin Islands, the Commonwealth of Puerto Rico, Guam, American Samoa, the Commonwealth of the Northern Mariana Islands, and Wake Island, and all other territories or possessions belonging to the United States of America.

1. Providing Much Needed Additional Information -- The notice to employees proposed in § 470.2(a) is very good. However, while an effective poster cannot be cluttered with too many words, the poster does not provide enough information. Simply referring employees to the National Labor Relations Board (NLRB) will not adequately promote employees' Beck rights.

Thus, the Department should consider adding a pull-off pamphlet at the bottom of the poster and including an Internet address on the poster and the pamphlet to a new Department webpage. Both the pamphlet and the webpage should contain basic legal advice to help employees navigate their way through the Beck procedures of unions and the NLRB. For examples of the types basic legal advice the pamphlet and the webpage should offer, please see the National Right to Work Legal Defense Foundation's excellent employee-friendly webpage entitled "How do I cut off the use of my dues for politics and other nonbargaining activities?" This page may be found at http://www.nrtw.org/a/a_4.htm.

Additionally, this detailed step-by-step information on the Department's new webpage should be accompanied by general form letters, requests, and similar documents that can be downloaded (in Adobe Acrobat "pdf" files) and used by employees in their legal fight to obtain their Beck refunds.

2. Enhancing the Text of the Poster -- The following emboldened additions and changes to the poster within § 470.2(a) will better advance employees Beck rights:

Under Federal law, employees cannot be required to join a union or maintain membership in a union in order to retain their jobs.

Under certain conditions, the law permits a union and an employer to enter into a union-security an agreement requiring employees to pay uniform periodic dues and initiation fees initiation fees and uniform periodic dues or fees to that union.

However, employees who are not union members can object to the use of their payments for certain purposes. and Employees can only be required to pay their share of union costs relating to collective bargaining, contract administration, and grievance adjustment. This means, for example, employees have a right not to pay for a union's political expenditures.

If you do not want to pay that portion of dues or fees used to support activities not related to collective bargaining, contract administration, or grievance adjustment, you are entitled to an appropriate reduction in your payment payments to the union. If you believe that you have been required to pay dues or fees used in part to support activities not related to collective bargaining, contract administration, or grievance adjustment, [add underline] you may be entitled to a refund and to an appropriate reduction in future payments.

For further information concerning your rights, you may wish to contact the National Labor Relations Board (NLRB) either at one of its Regional offices or at the following address: National Labor Relations Board, Division of Information, 1099 14th Street, NW, Washington, D.C. 20570. To locate the nearest NLRB office, see NLRB's website at www.nlrb.gov.

Additional information and sample refund request forms are available from the U.S. Department of Labor at www.dol.gov . . . [add new website address proposed above].

3. In the event that the contractor does not comply with any or all of the requirements set forth in paragraphs (1) or (2) above, this contract may will be cancelled, terminated, or suspended in whole or in part, and the contractor may will be declared ineligible for further Government contracts in accordance with procedures authorized in or adopted pursuant to Executive Order 13201 . . .

Section 470.3

1. Exemptions -- Section 470.3(c) should be improved as follows:

The Deputy Assistant Secretary for Labor-Management Programs may exempt a contracting agency or any person from requiring the inclusion of any or all of the employee notice clause in any specific contract, subcontract, or purchase order when the Deputy Assistant Secretary deems that special circumstances in the national interest so require. Requests for such exemptions are strongly discouraged, and there is a high burden on the requester to demonstrate that such special circumstances exist. Requests for such exemptions must be in writing, and must be directed to the Deputy Assistant Secretary for Labor-Management Programs . . .

 
Section 470.4

1. Number of Employees -- The § 470.4(a) exemption from § 470.2(a) for employers that employ fewer than 15 persons should be eliminated. The posting requirement of § 470.2(a) should apply to all employers regardless of their number of employees.

Alternatively, the Department should include in § 470.4(a) a provision explicitly giving under-15-employee employers the option to comply with § 470.2(a) and also strongly encourage them to do so. Such an option would enable a concerned under-15-employee employer to promote employees' Beck rights and would lessen the employer's exposure to union harassment, such as unfounded unfair labor practice complaints to the NLRB.

2. Local Law -- Because § 470 applies to employers located outside the several States, § 470.4(c) should be expand to include jurisdictions such as Guam, which recently enacted a Right-to-Work law. See Legislature Overrides Governor's Veto of Right-to-Work Legislation in Guam, [2000] Daily Labor Rep. (BNA) No.107, at A-9 (June 2, 2000). Thus, the following change should be made to § 470.4(c):

The posting requirement does not apply to contractor establishments or construction work sites in jurisdictions where state or local law forbids enforcement of union-security agreements.

Section 470.10

Content and Clarity -- The following changes and improvements should be made to § 470.10:

(a) The Deputy Assistant Secretary for Federal Contract Compliance may will conduct a compliance evaluation to determine whether a contractor holding a nonexempt contract is in compliance with the requirements of this part. . . .

(b) During such an evaluation, a determination will be made whether:

(1) The Accurate, correct, and unmarred employee notice is notices under § 470.2(a) are posted in many conspicuous places in and about each all of the contractor's establishments and/or construction work sites not exempted under § 470.4, including all places where notices to employees are customarily posted; and . . .

(c) The results of the evaluation will be documented in the evaluation record, which will include findings regarding the contractor's compliance with the requirements of the Executive Order and this part and, as applicable, conciliation efforts made, corrective action taken, and/or enforcement recommended under § 470.13.

1. Clarity -- To improve clarity, the word and parentheses "(complainant)" should be added after the word "employee" in the first sentence of § 470.11(a). This addition is required by the text of § 470.11(b), which twice uses the word complainant to refer to the employee mentioned in § 470.11(a) (i.e., "The complaint must be in writing and must include the name, address, and telephone number of the complainant, . . ." and "The complainant must sign the complaint.").  Thus, the first sentence of § 470.11(a) should read as follows:

An employee (complainant) of a covered contractor may file a complaint alleging that the contractor has failed to post the employee notice as required by the Executive Order and this part; and/or has failed to include the employee notice clause in nonexempt subcontracts or purchase orders.

Section 470.12

Time Limit -- Meaningful enforcement if § 470 and the resulting deterrent effect of such enforcement requires a time limit on the Departments "reasonable efforts to secure compliance through conciliation" under § 470.12(a). Therefore, §§ 470.12(a) and (c) should be amended as follows:

(a) If any complaint investigation or compliance evaluation indicates a violation of the Executive Order or this part, the Department will make reasonable efforts to secure compliance through conciliation subject to the time limit of § 470.12(c) . . .

(c) If a violation cannot be resolved through conciliation efforts within 10 days (not including weekends and federal holidays) of the initiation by the Department of such conciliation efforts, the Deputy Assistant Secretary for Labor-Management Programs may will proceed in accordance with § 470.13.

Enhancing the Text -- The procedures called for in § 470.13 are excellent, and only the following changes and improvements should be made to § 470.13:

(a) (1) Violations of the Executive Order may result in administrative proceedings to enforce the Order. The bases for a finding of a violation may will include, but are not limited to . . .

(2) If a determination is made that the Executive Order or the regulations in this part have been violated, and the violation has not been corrected through conciliation subject to the time limit of § 470.12(c), the Deputy Assistant Secretary for Labor-Management Programs may will refer the matter to the Solicitor of Labor for institution of administrative enforcement proceedings. . . .

(b) (5) . . . If the Assistant Secretary determines that the contractor has violated the Executive Order or the regulations in this part, the final administrative order may will enjoin the violations, require the contractor to provide appropriate remedies and, subject to the procedures in § 470.14, impose appropriate sanctions and penalties.

Enhancing the Text -- The sanctions and penalties called for in § 470.14 are excellent, and only the following changes and improvements, including paragraph (g), should be made to § 470.14:

(c) The sanctions and penalties described in this section, however, will may not be imposed if: . . .

(d) In enforcing the Order and this part, the Assistant Secretary may will: . . .

(2) Issue an order of debarment under section 6(b) of the Order providing that one or more all contracting agencies must refrain from entering into further contracts, or extensions or other modification of existing contracts, with any noncomplying contractor. . . .

(f) Periodically Monthly, the Assistant Secretary will publish and distribute, or cause to be published and distributed, to all executive agencies a list of the names of contractors that have, in the judgment of the Assistant Secretary under § 470.13(b) (5), failed to comply with the provisions of the Executive Order and this part, or of related rules, regulations, and orders of the Secretary of Labor, and as a result have been declared ineligible for future contracts or subcontracts under the Executive Order and the regulations in this part.

(g) Monthly, the Assistant Secretary will publish, or cause to be published, in the Federal Register and on the Department's website, for use by the general public, a list of the names of contractors that have, in the judgment of the Assistant Secretary under § 470.13(b) (5), failed to comply with the provisions of the Executive Order and this part, or of related rules, regulations, and orders of the Secretary of Labor, and as a result have been declared ineligible for future contracts or subcontracts under the Executive Order and the regulations in this part.

No Change -- The § 470.15 provision for contractor hearings is adequate as is and should not be changed.
 

Section 470.16

No Change -- The § 470.16 provision for contractor reinstatement is adequate as is and should not be changed.
 

Section 470.20

No Change -- The § 470.20 provision allowing the Secretary to delegate authority is adequate as is and should not be changed.
 

Section 470.21

No Change -- The § 470.21 provision for rulings and interpretations by the Assistant Secretary is adequate as is and should not be changed.
 

Section 470.22

Broad Definition -- The § 470.22 provision allowing the Assistant Secretary to take action "to ensure that no person intimidates, threatens, or coerces any individual for the purpose of interfering with the filing of a complaint, furnishing information, or assisting or participating in any manner in a compliance evaluation, complaint investigation, hearing, or any other activity related to the administration of the Executive Order or the regulations in this part" is exceptional and must not be deleted from the final rule.

The only improvement would be to ensure that the phrase "no person intimidates, threatens, or coerces any individual" is given the broadest definition possible. Consider adding a very broad definition or example to explain this phrase. Also, consider adding language stating that the Department must give the broadest meaning possible to this phrase as it administers the Executive Order and these regulations.

 
Section 470.23

No Change -- Section 470.23 about other provisions is adequate as is and should not be changed.
 
 

In conclusion, the proposed rule should be made final a soon as possible. NLPC is very supportive of the Department's action, but the Department should strongly consider NLPC's aforementioned specific comments to improve the proposed rule and further enhance employees’ ability to exercise their Beck rights.
 

Sincerely,

Kenneth F. Boehm
Chairman
 

Organized Labor Accountability Project

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