Starting June 21, 2010, U.S. government contracting departments and agencies will begin including provisions in government contracts requiring contractors and subcontractors to post an appropriate notice informing their employees engaged in contract-related work of their rights under federal labor laws. The terms of the notice, prescribed in the Department of Labor's regulations at 29 C.F.R. § 471 (which were finalized on May 20, 2010), serve to inform employees of their rights under the National Labor Relations Act to organize and bargain collectively with their employers and to engage in other protected concerted activity.

The notice and posting requirements do not apply to government contracts resulting from solicitations issued before June 21, 2010. Similarly, the regulations do not apply to collective bargaining agreements entered into by a federal agency, contracts that involve purchases below the simplified acquisition threshold (currently set at $100,000—see 41 U.S.C. § 403), or in those cases where the Director of the Office of Labor-Management Standards otherwise exempts a contracting department or agency from the requirements.

The regulations implement Executive Order 13496, which President Obama signed on January 30, 2009. The stated purpose of the Executive Order is "to promote economy and efficiency in government procurement" by ensuring that employees of certain government contractors are informed of their rights under federal labor laws.

In order to satisfy the DOL's new regulations, employers must physically post the requisite notice in "conspicuous places in and about the contractor's plants and offices so that the notice is prominent and readily seen by employees," and "[w]here employees covered by the NLRA engage in activities relating to the performance of the contract." Furthermore, if a significant portion of the employer's workforce is not proficient in English, the notice must be provided in the language or languages spoken by the employees. Finally, a contractor or subcontractor that customarily posts notices to employees electronically must also post the required notice electronically.

Employers that are parties to government contracts or subcontracts should look for this employee notice clause in all federal contracts, including renewals of existing contracts, and should be prepared to comply in a timely manner with the posting obligations.

Click here to read and print a copy of the Notice of Employee Rights set forth in the DOL's regulation.