Federal Contractors Must Now Post Notice Of Employee’s Rights to Unionize

By Stephen M. Darden, Esq. and Joseph B. Harvey, Esq.

(August 2010, published in The Johnson City Business Journal)

Just a few days after he was inaugurated, President Obama signed Executive Order 13496, which requires federal contractors and subcontractors to post a notice that informs employees of their rights under the National Labor Relations Act (NLRA), including the right to form and join unions.  The requirements of the Executive Order are now effective, having become enforceable as of June 21, 2010.

Pursuant to the Executive Order, the United States Department of Labor  (DOL) recently published the final regulation that prescribes the details of the required posting, including the exact language and even the dimensions of the poster.  The notice lists employees’ rights to organize, join, or assist a union, to take action with a co-worker to improve working conditions, and to strike and picket, among other things.  The posting also gives examples of unlawful conduct by employers and unions, provides the contact information for the National Labor Relations Board, and instructs employees to contact the Board with questions or complaints.

Federal contractors and subcontractors subject to the new law are required to post the notice in conspicuous places where the employer typically posts notices regarding other employment related matters  – on a bulletin board in the breakroom or near a time clock, for example.  In addition, if the employer customarily posts notices to employees electronically, for instance on a company website or intranet, the employer must also post the new poster electronically.  Federal contractors and subcontractors who have multiple facilities or operate at different locations are not necessarily required to post the notice at every facility or site.  Rather, the regulations require that the notice be posted only at those facilities or sites where employees perform work related to the federal contract.

The new posting requirement will be enforced by the Office of Federal Contract Compliance Programs (OFCCP).  The penalties for noncompliance can be severe, including cancellation, termination, or suspension of the contract in whole or in part, and “the contractor may be declared ineligible for further government contracts.”  However, when a violation is found, the regulations require that the OFCCP first make reasonable efforts to secure compliance through conciliation.  Thus, an employer who is willing to comply with the law most likely will not face the harshest of sanctions.

In 1954, 28.3% of Americans in the private workforce were represented by unions.  Since that time, the percentage of unionized employees has steadily decreased.  Currently, only about 12% of employees in the private sector are unionized.  This is a trend organized labor has tried to reverse in recent years.
Some have suggested that the proliferation of state and federal  laws protecting workers’ rights have made union representation less valuable — or even unnecessary.  Ironically, unions supported the passage of many laws that pushed unions’ services toward obsolescence.  But organized labor has changed its tactics in recent years — from promoting laws that would help workers to promoting laws that would help unions organize.  For example, organized labor has lobbied hard recently for the inaptly named “Employee Free Choice Act.”  The EFCA would make it easier for union to organize employees by implementing a “card check” procedure and eliminating the requirement of a secret ballot election among employees.   While organized labor has not been successful in passing the EFCA, it is no surprise that they have looked to other measures to increase membership and dues revenue.

While the DOL insists that the language of the new poster required by Executive Order 13496 is “balanced,” the posting requirement was clearly intended to promote unionization.  President Obama believes increasing union membership will benefit the economy and the country overall and has said so often.  According to the Executive Order, “attainment of industrial peace is most easily achieved and workers’ productivity is enhanced when workers are well informed of their rights under Federal labor laws, including the National Labor Relations Act.”

Given the poster’s intent, employers who are required to post the new notice should expect that the poster may prompt employees to ask questions about unions and think about whether they would like to be unionized.  Therefore, it is highly advisable for federal contractors and subcontractors to prepare supervisors and human resources personnel to respond appropriately to employees’ questions and to explain the realities of what it means to be unionized.   Companies who post the notice without a proactive strategy for responding to employee’s questions or union organizing activity may find that they are a part of organized labor’s “resurgence” under new laws and a NLRB favorable to union organization.


Stephen M. Darden, Esq. and Joseph B. Harvey, Esq. practice labor and employment law with Hunter, Smith & Davis, LLP.  Certification as a labor and employment law specialist is not currently available in Tennessee.