As part of our continued monitoring of the new human trafficking requirements, new guidance for a successful compliance plan, including a compliance plan template, was issued by a collaboration between the U.S. Department of State’s Office to Monitor and Combat Trafficking in Persons and three partners (Verité, Made in a Free World, and the Aspen Institute). The sample compliance plan that the U.S. State Department and its partners created, known as the Responsible Sourcing Tool, sets forth a model “Company Human Trafficking Policy,” which:
In addition to the specifically discussed categories, government grantees are subject to a host of additional compliance issues, including but not limited to employment requirements, human trafficking obligations, international compliance matters, and increasingly, cybersecurity concerns. As such, it is important for grantees to remain knowledgeable of recent changes and developments in these areas in order to achieve compliance and programmatic success.
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On May 18, 2016, the U.S. Department of Labor (DOL) released final revisions to the FLSA’s overtime exemption regulations, which were published on May 23, 2016. These new regulations are applicable to all employers, including federal nonprofit grant and cooperative agreement recipients, contractors, and subcontractors. Specifically, the new regulations doubled the minimum salary threshold for the executive, administrative, and professional exemptions (the “white-collar” exemptions) from $23,660 annually ($455 per week) to $47,476 annually ($913 per week). Ten percent of this new salary threshold may be earned and paid through nondiscretionary bonuses, incentive pay, and commissions, as long as such payments are made on at least a quarterly basis. Moreover, beginning on January 1, 2020, the salary threshold will automatically update every three years and will be tied to the 40th percentile of weekly earnings of full-time salaried workers in the region of the country with the lowest wages. No changes were made to the “standard duties” test for the white-collar exemptions.
As we touched on in a previous newsletter, on February 25, 2016, the U.S. Department of Labor (DOL) published its Notice of Proposed Rulemaking implementing Executive Order 13706, Establishing Paid Sick Leave for Federal Contractors. Executive Order 13706 requires parties, including nonprofits, that enter into contracts with the federal government to provide covered employees with up to seven days of paid sick leave on an annual basis, for such reasons as the employee’s medical condition, care for a close family member’s medical condition, and absences resulting from domestic violence, sexual assault, and stalking. The comment period was originally due to close on March 28, 2016. However, based on public comments received and the interest expressed, the DOL has extended the comment period until April 12, 2016.
On February 25, 2016, the DOL published its Notice of Proposed Rulemaking implementing Executive Order 13706, Establishing Paid Sick Leave for Federal Contractors (NPRM). Executive Order 13706, which was signed by President Obama on September 7, 2015, requires parties, including nonprofits, who enter into contracts with the federal government to provide covered employees with up to seven days of paid sick leave on an annual basis, for such reasons as the employee’s medical condition, care for a close family member’s medical condition and absences resulting from domestic violence, sexual assault, and stalking.
This year, the federal government focused its attention on eliminating U.S. government dollars from supporting human trafficking. The federal government manifested this focus through the enactment of aggressive compliance requirements for federal grantees and contractors. The year began with the implementation of expansive Federal Acquisition Regulation (FAR) provisions for federal contractors. Although the FAR requirements are not applicable to federal grantees, they are based on the Trafficking Victims Protection Act (TVPA) of 2000, 22 U.S.C. §§ 7101 et seq., which mandates that federal agencies require federal grantees and contractors to combat human trafficking behavior in federal grantees and contractors alike.
In our April 2014 update, we focused on President Obama’s Executive Order and Presidential Memorandumadvancing pay equality for women and minorities employed by Federal contractors, including nonprofits. The U.S. Department of Labor recently extended the deadline for comments on the proposed rules to implement the president’s directive.
On April 8, 2014, President Barack Obama signed an Executive Order and a Presidential Memorandum advancing pay equality for women and minorities employed by Federal contractors. The Order prohibits Federal contractors that generally have contracts exceeding $10,000 from retaliating against employees who discuss their compensation. The Memorandum directs the U.S. Department of Labor (DOL) to propose a rule requiring Federal contractors and subcontractors to submit summary compensation data to DOL, including data categorized by sex and race. The data will be used to develop tools to enhance both voluntary compliance with and enforcement of Federal Equal Pay and Civil Rights laws. DOL must issue the rule within 120 days. Contractors will not understand the full impact of either the Order or Memorandum until DOL implements its regulations. The Memorandum requests DOL “[t]o the extent feasible…avoid new record-keeping requirements and rely on existing reporting frameworks.” Although the Executive Order and Presidential Memorandum appear to apply to contractors and not grantees, nonprofits that have both contracts and grants with the Federal government will be covered.
In January, the Government Accountability Office (GAO) released a report – Recovery Act: Grant Implementation Experiences Offer Lessons for Accountability and Transparency – which details lessons learned regarding useful practices and challenges to ensuring the accountability of grants funded by the American Recovery and Reinvestment Act of 2009 (Recovery Act). Many of these challenges are common among a broad range of grant recipients, and thus, may be equally common and useful for all grant recipients to address such challenges.
Faced with aggressive timelines for distributing billions of dollars, federal, state, and local officials adopted a number of practices to foster accountability including: Continue Reading GAO’s Review of Recovery Act Grant Funds
On September 25, 2012, President Obama issued Executive Order 13627, Strengthening Protections Against Trafficking in Persons in Federal Contracts. Comments were due this month on a proposed rule issued by the Federal Acquisition Regulation (FAR) Council to implement the President’s Executive Order.
In short, the proposed rule strengthens prior legislation by imposing several new and significant responsibilities on contractors and subcontractors to act affirmatively to prevent human trafficking and forced labor. First, the rule prohibits certain conduct, such as the:
- Destruction, concealment, confiscation, or denial (in any manner) of an employee’s access to their identity documents (e.g., passport, work visa, etc.);
- Use of misleading or fraudulent recruitment practices;
- Charge of recruitment fees to employees;
- Provision or arrangement of housing that fails to meet the host country safety standards;
- Failure to provide a written employment contract, recruitment agreement, or similar document in the employee’s native language; and
- Failure to pay return transportation costs upon the end of employment for those brought into the U.S. for the purpose of working on a U.S. government contract or subcontract.
On November 14-15, 2013, the National Institute of Standards and Technology (NIST) held a workshop at North Carolina State University on the preliminary Cybersecurity Framework (PCF). Venable attended this workshop, as well as all of the previous NIST workshops addressing the Framework.
Of particular interest to federal grantees is EO 13636’s direction to the Department of Homeland Security (DHS) to “coordinate the establishment of a set of incentives designed to promote participation in the [voluntary program].” That being said, the vast majority of these incentives likely would require federal legislation to be realized. As a result, DHS stated at one of the topic-specific working sessions earlier this month that it only can offer “a very limited set of incentives” in the near term. Indeed, it appears that the only incentive mentioned by DHS that would be available at “launch time” in February 2014 is prioritization of support and technical assistance. Other “incentives” noted in the DHS presentation include continuing engagement with the insurance industry and private sector “to understand the role of insurance in organizational risk;” coordinating with the General Services Administration and the Department of Defense on procurement considerations; working to link existing federal grant programs to adoption of the Framework; discussing rate recovery for price-regulated industries with responsible state and federal agencies; and examining the potential for regulatory streamlining to promote adoption.
Consequently, while nonprofits may not be particularly focused on cybersecurity, much like several other social reform efforts of prior administrations, the President may use the procurement and non-procurement (i.e., grant) programs as a means of implementing cybersecurity protocol and requirements at large. Venable has tracked and written extensively on the development of the preliminary Cybersecurity Framework developed by NIST.