June 20, 2021

Volume XI, Number 171


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June 17, 2021

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U.S. Labor Department Publishes Proposed Regulations Implementing Executive Order on Government Contractor Paid Sick Leave

The U.S. Department of Labor has published proposed regulations implementing Executive Order 13706, requiring federal contractors and subcontractors to give their workers the ability to earn up to seven days (56 hours) of paid sick leave each year.

The EO 13706, signed by President Barack Obama on September 7, 2015, requires DOL to issue final regulations by September 30, 2016. The Executive Order covers new contracts resulting from solicitations issued on or after January 1, 2017, and “new” contracts awarded outside the solicitation process on or after January 1, 2017. In addition to the DOL rulemaking, the Executive Order also requires the Federal Acquisition Regulatory Council (FAR Council) to issue implementing regulations for contracts subject to the Federal Acquisition Regulations.

Public comments on proposed regulations must be submitted by March 28, 2016.

Contracts Covered

Following the structures of the Federal Contractor Minimum Wage Executive Order and implementing regulations, Executive Order 13706 and its proposed regulations pertain to contracts, or contract-like instruments, that are:

  1. procurement contracts for construction covered by the Davis-Bacon Act (DBA) (but not contracts subject only to the Davis-Bacon Related Acts);

  2. service contracts covered by the Service Contract Act (SCA);

  3. concessions contracts, including any concessions contract excluded from the SCA by the DOL’s regulations at 29 CFR 4.133(b); and

  4. contracts in connection with federal property or lands and related to offering services for federal employees, their dependents, or the general public.

Employees Covered, Earning Rate

Employees entitled to paid leave are those who:

  1. work directly on covered contracts or

  2. conduct work “in connection” with covered contracts and whose wages are governed by DBA, SCA or the Fair Labor Standards Act (FLSA).

In an important distinction, unlike the Minimum Wage regulations, the government contractors’ paid sick leave obligations apply to exempt employees as well as those who are non-exempt under the FLSA. For both exempt and non-exempt workers, there is a narrow exemption from the mandated sick leave for those workers who perform work only “in connection with” the contract (but not in direct contract work) who spend less than 20 percent of their hours worked in any workweek performing such work.

Employers must allow covered employees to earn an hour of paid leave for every 30 hours of paid time (which may not necessarily mean worked time) on covered contracts.

Permitted Uses, Notice, Carry Over

Employees can use this leave to care for themselves or family members. Paid sick leave earned may be used by an employee for an absence resulting from:

  • Illness, injury, or medical condition;

  • Obtaining diagnosis, care, or preventive care from a health care provider;

  • Caring for a child, a parent, a spouse, a domestic partner, or any other individual related by blood or affinity whose close association with the employee is the equivalent of a family relationship, who has need for diagnosis, care, or preventive care, or is otherwise in need of care; and

  • Domestic violence, sexual assault, or stalking.

The worker must give at least seven days’ prior notice of the need to take leave if the need for leave is foreseeable, or as soon as practicable if the need is not foreseeable. If the worker takes more than three consecutive workdays of leave, certifications supporting the need for leave must be provided within 30 days from the first day of leave.

Workers can carry over unused leave from year to year and unused leave will be reinstated for employees rehired by a covered contractor (including a successor contractor that performs the same or similar services at the same location as the predecessor contractor) within 12 months after a job separation.

Payment for unused leave upon job separation is not required under the Executive Order.

Interplay with Other Requirements

The proposed regulations set forth the interplay between the federal paid sick leave requirement and:

  1. an employer’s existing paid time off policies; and

  2. state and local paid sick leave requirements.

For employers whose contracts are covered by SCA or DBA, the proposed regulations follow the mandate of the Executive Order by making clear that the new paid sick leave is in addition to the benefits provided to covered workers under wage determinations issued by the DOL under those laws.


Given the short comment period, until March 28, federal contractors interested in trying to change these regulations before they become final should act quickly.

We will provide more detailed analysis of the requirements and their impact on federal contractors, including the onerous recordkeeping obligations associated with the provision of paid sick leave.

Jackson Lewis P.C. © 2021National Law Review, Volume VI, Number 57



About this Author

Leslie Stout-Tabackman, Labor Employment Attorney, Shareholder, Jackson Lewis Law Firm

Leslie Stout-Tabackman is a Principal in the Washington, D.C. Region office of Jackson Lewis P.C. She has a broad-based practice counseling and representing employers on compliance with federal and state workplace laws and regulations, and designing and implementing sound practices and policies.

Ms. Stout-Tabackman regularly counsels and represents clients with matters before the U.S. Department of Labor’s (DOL) Wage and Hour Division, including Fair Labor Standards Act (FLSA) issues and prevailing wage and benefits issues arising under the Service Contract Act...

Francis P. Alvarez, Jackson Lewis, Health Care Management Attorney, Injured Workers Lawyer

Francis P. (Frank) Alvarez is a Principal in the White Plains, New York, office of Jackson Lewis P.C. He is the Leader of the Disability, Leave and Health Management Practice Group, which assists employers in meeting the legal and practical challenges posed by federal and state laws protecting injured and ill employees.

Counseling hundreds of employers each year, Mr. Alvarez spearheads the firm’s effort to provide imaginative and creative solutions to the complex array of workplace disability and health management issues...

Laura Mitchell, Jackson Lewis, Management Representation lawyer, Contractual Drafting Attorney

Laura A. Mitchell is a Principal in the Denver, Colorado, office of Jackson Lewis P.C. She represents management exclusively in all areas of employment law, focusing on affirmative action and government contractor compliance.

Ms. Mitchell is a Principal in the firm’s Affirmative Action and OFCCP Defense practice group, representing government and non-government contractors in Office of Federal Contract Compliance Programs (OFCCP) matters, preparing for and defending OFCCP audits, and counseling employers on issues stemming...

Patricia Anderson Pryor, Class Action, Litigator
Principal and Office Litigation Manager

Patricia Anderson Pryor is a Shareholder in the Cincinnati, Ohio office of Jackson Lewis P.C. Ms. Pryor is an experienced litigator in both state and federal courts, representing and defending employers in nearly every form of employment litigation, including class actions.

She represents and advises employers in federal and state administrative proceedings, in all forms of dispute resolution, including mediation and arbitration, and in managing all aspects of the employment relationship. She has represented...

Mickey Silberman, Labor and Employment law attorney, Jackson Lewis Law firm, Principal

Mickey Silberman is a Principal in the Denver, Colorado, office of Jackson Lewis P.C. He is the Chair of the Jackson Lewis Affirmative Action & OFCCP Defense Practice Group and the Co-head of the firm’s Pay Equity Resource Group.

Mr. Silberman and the practice group annually prepare thousands of affirmative action plans for employers in all industries and throughout the country. During the past several years, Mr. Silberman has directed the defense of hundreds of OFCCP audits, including successful defense of Corporate Management (“glass ceiling”) Reviews....