National Association of Government Contractors


Obama-era First Refusal Executive Order Rescinded

Late last month, President Trump issued an executive order to "promote economy and efficiency in Federal Government procurement," by rescinding an Obama-era EO, which gave existing employees, a "right of first refusal" for jobs on successor service contracts. 
 
Since 2009, when then-President Obama issued Executive Order (EO) 13495 (Nondisplacement of Qualified Workers Under Service Contracts), the majority of federal contractors (and their subcontractors) awarded follow-on service contracts at a particular location had been obligated to take several measures before hiring their own workforce.  
 
Most notably, contractors were required to extend job offers to employees of the predecessor contractor who had worked on the contract site for at least three months.
 
Only if those employees refused these offers could contractors turn to hire the employees of their choosing.  Additionally, the contracts themselves had to contain specific language detailing those obligations.
 
Executive Order 13495 has now been revoked, pending issuance final rule.  Secretary of Labor Eugene Scalia has also been ordered to terminate immediately any investigations or compliance actions based on EO 13495, and relevant departments and agencies must move "promptly" to rescind all regulations and other guidance arising from that EO. 
 
President Trump's revocation E.O. requires agencies to "promptly move to rescind any orders, rules, regulations, guidelines, programs, or policies implementing or enforcing Executive Order 13495." It further requires the Secretary of Labor to immediately terminate any investigations or compliance actions based on E.O. 13495.



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