Lexology, always a reliable source for government contracting updates (and more), hit a trifecta of such features with its procurement related article selections that hit my inbox today. Here's a brief sampling of them.
On January 6, 2021, the DoD issued a class deviation, effective immediately, to implement the nationwide court order enjoining Sections 4 and 5 of Executive Order (EO) 13950, Combating Race and Sex Stereotyping. EO 13950 prohibits federal agencies, contractors, and grant recipients from using workplace diversity and inclusion trainings to “promote race or sex stereotyping or scapegoating,” with Section 4 applying specifically to government contractors.That new Court Order trumped Executive Order 13950. Also see Venable's post,Dismantling EO 13950 – Nationwide Preliminary Injunction Results in Suspension of Enforcement Measures for a bit more flavor and information.
For the foreseeable future, Federal contractors, subcontractors, and grant recipients alike no longer need to comply with or worry about the enforcement of EO 13950, especially given President‑elect Joe Biden's very recent announcement that he is appointing Boston Mayor Marty Walsh as the Secretary of Labor. In particular, Mayor Walsh has issued executive orders over the past few years that declare racism an emergency and public health crisis with the goal of "dismantl[ing] [] systemic racism"; acknowledge and improve racial equity through government, as further reported on here; and "create a national model for breaking down system racism across all aspects" of Boston, as reported here. Given that history, it is likely safe to assume that, if confirmed, Mr. Walsh has no intention of advancing policies akin to those in EO 13950.Religion: OFCCP Issues Final Rule on Religious Exemptions for Government Contractors
The Office of Federal Contract Compliance Programs issued Implementing Legal Requirements Regarding the Equal Opportunity Clause’s Religious Exemption final rule, which becomes effective on January 8, 2021. The final rule is intended to clarify the scope and application of the religious exemption in light of recent developments, including Supreme Court rulings and Executive Orders. Among other things, it clarifies that, in addition to churches, the exemption covers employers that: are organized for a religious purpose; hold themselves out to the public as carrying out a religious purpose; engage in exercise of religion consistent with and in furtherance of a religious purpose; and either operate on a not-for-profit basis or present other strong evidence that their purpose is substantially religious. Moreover, religious employers may condition employment on compliance with religious tenets, as long as they do not discriminate on other protected bases. This particular provision has caused concern, as some have interpreted it to permit discrimination against LGBTQ individuals. Among its key provisions, the final rule adds a rule of construction to provide the maximum legal protection of religious exercise permitted by the Constitution and laws, including the Religious Freedom Restoration Act.Privacy (well, one person's privacy is another person's transparency): New Corporate Transparency Act Will Impose Beneficial Ownership Reporting Requirements on Many Companies, Particularly Small Businesses
The Corporate Transparency Act (CTA), part of the 2021 National Defense Authorization Act enacted into law on January 1, 2021, will impose new beneficial ownership reporting requirements on many companies. The stated purposes of the CTA include the collection of beneficial ownership interest information for corporations, limited liability companies and similar entities "to (A) set a clear, Federal standard for incorporation practices; (B) protect vital United States national security interests; (C) protect interstate and foreign commerce; (D) better enable critical national security, intelligence and law enforcement efforts to counter money laundering, the financing of terrorism and other illicit activity; and (E) bring the United States into compliance with international anti-money laundering and countering the financing of terrorism standards." Many types of entities, however, are exempted from the requirements of the CTA. These entities include, among others: public companies; governmental entities; banks and bank holding companies; credit unions; broker dealers; registered investment companies; registered investment advisers; insurance companies; registered public accounting firms; public utilities; certain pooled investment vehicles; 501(c) entities; companies with more than 20 full-time employees in the United States, more than $5 million in gross receipts or sales, and an operating presence at a physical office in the United States; and entities owned or controlled by one or more of such exempt entities. A reporting company will be required to identify each beneficial owner and applicant and report the individual's full legal name, date of birth, current residential or business address, and a "unique identifying number from an acceptable identification document" (generally a nonexpired passport, state issued driver's license or identification card or, if the individual does not have any of these, a nonexpired foreign passport) or a FinCen identifying number. The reporting company need only report the name of the exempt entity having a direct or indirect ownership interest in the reporting company (and not any of the other identifying information otherwise required). There are many issues of scope, definition and interpretation in the CTA which are expected to be addressed by the Treasury's forthcoming implementing regulations.See, also, How do you determine prospective contractor responsibility if you don't know who the contractor really is?
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