Unions Seek Role in Federal Contracts

Unions Seek Role in Federal Contracts

By Neil Munro
Staff Writer

High-tech companies could lose lucrative federal contracts by getting entangled in labor disputes with unions if new proposals being considered by the White House are adopted, some business executives say.

The proposals, being considered by the Office of Federal Procurement Policy, would allow disputes between a company and its workers to be counted as a demerit on the company's performance records, which are increasingly being considered by federal contract officers during contract competitions.

The proposals could also wipe out corporate tax deductions for legal expenses incurred by labor disputes, said the executives, who are members of a lobbying coalition called the National Alliance Against Blacklisting, chaired by Hal Coxson, a lawyer with the Washington-based firm of Ogletree, Deakins, Nash, Smoak & Stewart. Member groups of the alliance, which is trying to stop or weaken the proposal, include the U.S. Chamber of Commerce and the Business Roundtable.

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Vice President
Al Gore

The proposed rules would boost unions' role in federal contracts, help them establish unions in the sparsely unionized information technology sector and force companies to grant higher wages and benefits to professional workers, say industry officials.

White House officials have not decided upon a release date or on final language for the proposal, said one source. One target for the new plan is the defense industry, the source said, adding "certainly, the information technology industry is not the focus."

Since February, officials from the AFL-CIO alliance of trade unions have been working with White House officials, including deputies in the office of Vice President Al Gore, to draft and promote the new regulations.

In a March 25 memo to union officials, John Sweeney, the president of the Washington-based AFL-CIO, asked union officials to collect examples "of corporate lawbreaking or bad practice." The examples are needed to rebut criticism of the proposals and "to help us make the most of these initiatives and have a positive, pro-worker impact on the world of federal contracting," said the memo.

The new rules are needed because "federal contractors are using taxpayer money to fight union organizing campaigns ... [and] government contractors are running sweatshops," said Ron Blackwell, director of the AFL-CIO's corporate affairs.

The proposal is likely to be released because both Clinton and Gore - who wants union support in his bid for the Democratic presidential nomination in 2000 - need "to shore up the administration's links with the unions, specifically after the Fast Track debate," said a Republican staff member. "I have no doubt they will [issue] the regulation. ... [but] we will not take it lightly," he said.

Early this month, union leaders overcame stiff opposition from Clinton and industry by persuading Congress to reject Clinton's request for Fast Track negotiating authority on international trade deals. If Congress had approved the Fast Track authority, which was strongly supported by information technology companies such as Microsoft Corp., U.S. and foreign negotiators could sign deals that Congress would be only able to accept or reject, but not amend.

If the regulations are enacted, either as a formal change to the Federal Acquisition Regulations or as less-formal implementation guidance for contract officers, unions could threaten a damaging labor dispute if companies don't accede to union demands, said Jody Olmer, a lobbyist with the U.S. Chamber of Commerce. If a company does not cooperate, a union complaint might hurt its "past performance" records and weaken its ability to keep or win contracts, she said.

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