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Executive Order 13706, Establishing Paid Sick Leave for Federal Contractors (80 FR 54697) establishes paid sick leave for Federal contractors and subcontractors. The Executive order indicates that Executive Departments and agencies shall, to the extent permitted by law, ensure that new contracts, contract-like instruments, and solicitations as described in section 6 of the order, include a clause, which the contractor and any subcontractors shall incorporate into lower-tier subcontracts, specifying that all employees, in the performance of the contract or any subcontract thereunder, shall earn not less than one hour of paid sick leave for every 30 hours worked. Consistent with the Executive order, the Department of Labor will issue implementing regulations.

Overall Description of Deadline: Executive Order 13706, Establishing Paid Sick Leave for Federal Contractors (80 FR 54697).

Statement of Need:

On September 7, 2015, President Barack Obama signed Executive Order 13706 Establishing Paid Sick Leave for Federal Contractors. The Executive order states that the order seeks to increase efficiency and cost savings in the work performed by parties that contract with the Federal Government by ensuring that employees on those contracts can earn up to 7 days or more of paid sick leave annually, including paid leave allowing for family care. The order states that providing access to paid sick leave will improve the health and performance of employees of Federal contractors and bring benefits packages at Federal contractors in line with model employers, ensuring that they remain competitive employers in the search for dedicated and talented employees. The order indicates that [t]hese savings and quality improvements will lead to improved economy and efficiency in Government procurement.

Summary of the Legal Basis:

Section 2 of the Executive order states that Executive Departments and agencies shall, to the extent permitted by law, ensure that new contracts, contract-like instruments, and solicitations (collectively referred to as contacts), as described in section 6 of the order, include a clause, which the contractor and any subcontractors shall incorporate into lower-tier subcontracts, specifying, as a condition of payment, that all employees in the performance of the contract or any subcontract thereunder, shall earn not less than 1 hour of paid sick leave for every 30 hours worked. The order goes on to indicate that a contractor may not set a limit on the total accrual of paid sick leave per year, or at any point in time, at less than 56 hours. The order goes on to describe the purposes for which the employee may use the paid the sick leave. The Executive order requires the Secretary of Labor to issue regulations implementing the Executive order by September 30, 2016.

Alternatives:

To be determined.

Anticipated Costs and Benefits:

The Executive order indicates benefits associated with the paid sick leave Executive order include improved health and performance of employees of Federal contractors, ensuring that contractors remain competitive in line with model employers, and improved economy and efficiency in Government procurement. 

Costs will be determined as part of the NPRM.

Risks:

To be determined.