OFCCP Week In Review: February 21, 2022

• This Week’s Vaccination Injunction Puzzle at a Glance
• It is a “One Ticket, One Ride” Win for Only the Outdoorsy People as the Biden Minimum Wage Order Faces First Litigation Defeat
• A Third “Stop Gap” Continuing Resolution Keeps the Federal Government Alive through March 11th
• Upcoming Event | DE Masterclass Employment Law Roundtable Tackles Retaliation: The Rising Centerpiece of Civil Rights Enforcement

Thursday, February 17, 2022: It is a “One Ticket, One Ride” Win for Only the Outdoorsy People as the Biden Minimum Wage Order Faces First Litigation Defeat

Last week, we reported on two lawsuits brought by eight states seeking to enjoin enforcement of President Biden’s Executive Order 14026 implementing a $15/hour minimum wage for employees of federal contractors and subcontractors. This week, the Executive Order met its first litigation defeat, although it is a small win. Two judges of the United States Court of Appeals for the Tenth Circuit (Denver) issued an injunction against the minimum wage hike, but only as to contracts entered into or renewed after January 30, 2022 in connection with seasonal recreational services or seasonal recreational equipment rental to the general public on federal lands.

The U.S. District Court for Colorado had earlier denied a request by rafting companies which operate on federal lands for an injunction against the new minimum wage order.  The companies, rafting outfitters that offer seasonal whitewater rafting tours, argued the permits they received to use federal land did not make them federal contractors subject to the Executive Order, and that President Biden exceeded his authority when issuing the new wage mandate. Finding for the Administration, federal District Court Judge Philip Brimmer had held in January that substantial precedent showed that Presidents had authority to address the minimum wage of federal contractor employees pursuant to the Federal Procurement Act, including recent actions by both Presidents Obama and Trump. Furthermore, the lower court had held that an increase to the minimum wage for federal contractor employees was not “unusual agency action” or a rule of “extraordinary significance” which would be needed to implicate the “major questions” doctrine that would preclude administrative rulemaking.

The rafting companies then appealed Judge Brimmer’s order, while also requesting the Tenth Circuit to issue an injunction precluding enforcement of the minimum wage Executive Order during the pendency of their appeal.

In a two-page order, the Tenth Circuit has now agreed to issue an injunction during the pendency of the appeal on the grounds that the companies “demonstrated an entitlement to relief from the Minimum Wage in their particular circumstances.” The Tenth Circuit offered no reasoning for its determination and limited its injunction to “contracts or contract-like instruments entered into with the federal government in connection with seasonal recreational services or seasonal recreational equipment rental for the general public on federal lands.” Given the brevity of the order, it appears the Tenth Circuit merely sought to ensure the specific plaintiffs in the suit remained in the same economic position during their appeal. As a result, the Tenth Circuit’s ruling provides no reasoning that would be beneficial for the states to argue in the lawsuits they filed last week.

Punchline: Unless a federal contractor or subcontractor is a seasonal recreational vendor for the public on federal lands, the new minimum wage requirement continues to remain in place. Furthermore, the ruling provides no insight as to how the District Courts in Arizona and Texas will rule as to the legal arguments raised in the states’ suits that are similar in nature to the vaccine mandate arguments used previously. For now, the ruling does not appear to provide much hope for federal contractors and subcontractors seeking to overturn the $15/hour minimum wage requirement.

Friday, February 18, 2022: A Third “Stop Gap” Continuing Resolution Keeps the Federal Government Alive through March 11th

Down to the wire on Thursday afternoon, the U.S. Senate passed “H.R. 6671 – 117th Congress: Further Additional Extending Government Funding Act,” sending the bill to the President, who in turn signed it just hours before an otherwise federal government shutdown. The bill provides a Continuing Resolution (CR) that extends funding, but only for three weeks, through Friday, March 11, 2022.

Although the CR unanimously passed in the House last week, that was not the case in the Senate. Last-minute “Hail Mary” efforts by a few members of the Senate to add amendments to the bill all failed, but only after much drama on the floor of the Senate. These failed efforts included an attempted prohibition of any funding for COVID-19 vaccine mandates and specifically for schools and early childhood development facilities that enforce COVID-19 vaccine mandates on children. The Senate majority ultimately shot down these amendments as well as an amendment seeking to require balanced budgets in all future Continuing Budget Resolutions.

What’s Next?

The CR funds most programs and activities at the FY 2021 levels with several exceptions which provide flexibility in financing or additional appropriations for various programs. Because leaders of both Houses are now confident that they are only days away from a full and final agreement on a complete budget for the last almost seven months of the 2022 Fiscal Year (ending September 30, 2022), the parties agreed to this very short CR so the negotiators could finish.

In fact, the Chairs of both Appropriations Committees (Senate and House) even announced a bipartisan agreement for the fiscal year 2022 appropriations. Chairman of the Senate Appropriations Committee Patrick Leahy (D-VT) had this to say:

“The alternative – a full-year continuing resolution – is untenable and far too onerous on the American people. Our government is not meant to run on autopilot, and American taxpayer dollars should not be spent on outdated priorities. We have the responsibility to make the hard choices about how to invest in the American people.”

When asked on Wednesday when the President would send his FY 2023 budget to the Hill, White House Press Secretary Jen Psaki responded that she did not know. However, Shalanda Young, Acting Director of the Office of Management and Budget, recently reported it was expected to be after the President’s annual State of the Union address (March 1st).

Upcoming Event | Tuesday, February 22, 2022: DE Masterclass Employment Law Roundtable Tackles Retaliation: The Rising Centerpiece of Civil Rights Enforcement

Retaliation claims continue to surge across the country (see our recent report “Retaliation Remained the Top EEOC Charge in FY 2020”), and as such, federal agencies look to provide relief (see our report “NLRB, EEOC, and USDOL Join Forces To Use Their “Bully Pulpits” to Combat Workplace Retaliation”). However, what’s an employer to do with no substantive guidance from any of these agencies?

THIS COLUMN IS MEANT TO ASSIST IN A GENERAL UNDERSTANDING OF THE CURRENT LAW AND PRACTICE RELATING TO OFCCP. IT IS NOT TO BE REGARDED AS LEGAL ADVICE. COMPANIES OR INDIVIDUALS WITH PARTICULAR QUESTIONS SHOULD SEEK ADVICE OF COUNSEL.