Construction firms pulling back from federal market due to new reporting rules

Construction companies are stepping away from the federal contracting market because they say recently finalized reporting rules have placed too much risk on them.

The Fair Pay and Safe Workplaces executive order (EO 13,673) requires contractors to disclose any violations of 14 federal labor and employment laws and comparable state laws for the previous three years when seeking federal contracts worth more than $500,000. Agencies can deny contracts based on the disclosures.

Brian Turmail, executive director of public affairs for Associated General Contractors of America (AGC), reportedly called the rules “very subjective, very vague.” One complaint, according to Turmail, is that there is too much potential for regulators to assess violations inconsistently.

Fewer firms vying for federal contracts will mean higher costs, industry insiders say. A Bricklayers & Allied Craftworkers’ official countered that argument by saying responsible firms will be eager to win large contracts.