# Establishing Paid Sick Leave for Federal Contractors > Briefs, arguments, decisions, and more. URL: https://www.frixlaw.com/law-library/documents/fr%3A2016-22964 ## Record - **Collection:** Federal Register - **Document type:** Rule - **Published:** September 30, 2016 - **Citation:** 81 FR 67598 ## Text DEPARTMENT OF LABOR Office of the Secretary 29 CFR Part 13 RIN 1235-AA13 Establishing Paid Sick Leave for Federal Contractors AGENCY: Wage and Hour Division, Department of Labor. ACTION: Final rule. SUMMARY: This Final Rule issues regulations to implement Executive Order 13706, Establishing Paid Sick Leave for Federal Contractors, signed by President Barack Obama on September 7, 2015. Executive Order 13706 requires certain parties that contract with the Federal Government to provide their employees with up to 7 days (56 hours) of paid sick leave annually, including paid leave allowing for family care; it explains that providing access to paid sick leave will improve the health and performance of employees of Federal contractors and bring their benefits packages in line with model employers, ensuring that Federal contractors remain competitive employers and generating savings and quality improvements that will lead to improved economy and efficiency in Government procurement. The Order directs the Secretary of Labor to issue regulations to implement its requirements by September 30, 2016. This Final Rule defines terms used in the regulatory text, describes the categories of contracts and employees the Order covers and excludes from coverage, sets forth requirements and restrictions governing the accrual and use of paid sick leave, and prohibits interference with or discrimination for the exercise of rights under the Executive Order. It also describes the obligations of contracting agencies, the Department of Labor, and contractors under the Executive Order, and it establishes the standards and procedures for complaints, investigations, remedies, and administrative enforcement proceedings related to alleged violations of the Order. As required by the Order and to the extent practicable, the Final Rule incorporates existing definitions, procedures, remedies, and enforcement processes under the Fair Labor Standards Act, the Service Contract Act, the Davis-Bacon Act, the Family and Medical Leave Act, the Violence Against Women Act, and Executive Order 13658, Establishing a Minimum Wage for Contractors. DATES: Effective date: This Final Rule is effective on November 29, 2016. Applicability date: For procurement contracts subject to the Federal Acquisition Regulation and Executive Order 13706, this Final Rule is applicable only after the effective date of regulations to be issued by the Federal Acquisition Regulatory Council. The Department of Labor will publish a document in the Federal Register to announce the applicability date for such contracts. FOR FURTHER INFORMATION CONTACT: Robert Waterman, Compliance Specialist, Wage and Hour Division, U.S. Department of Labor, Room S-3510, 200 Constitution Avenue NW., Washington, DC 20210; telephone: (202) 693-0406 (this is not a toll-free number). Copies of this Final Rule may be obtained in alternative formats (large print, Braille, audio tape or disc), upon request, by calling (202) 693-0675 (this is not a toll-free number). TTY/TDD callers may dial toll-free 1-877-889-5627 to obtain information or request materials in alternative formats. Questions of interpretation and/or enforcement of the agency's regulations may be directed to the nearest Wage and Hour Division (WHD) district office. Locate the nearest office by calling the WHD's toll free help line at (866) 4US-WAGE ((866) 487-9243) between 8 a.m. and 5 p.m. in your local time zone, or log onto the WHD's Web site for a nationwide listing of WHD district and area offices at http://www.dol.gov/whd/america2.htm . SUPPLEMENTARY INFORMATION: I. Executive Order 13706 Requirements and Background On September 7, 2015, President Barack Obama signed Executive Order 13706, Establishing Paid Sick Leave for Federal Contractors (the Executive Order or the Order). 80 FR 54697. Section 1 of Executive Order 13706 explains 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. 80 FR 54697. 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. Id. The Order further states that these savings and quality improvements will lead to improved economy and efficiency in Government procurement. Id. Section 2 of the Executive Order establishes paid sick leave for Federal contractors and subcontractors. 80 FR 54697. Section 2(a) provides that executive departments and agencies (agencies) shall, to the extent permitted by law, ensure that new contracts, contract-like instruments, and solicitations (collectively referred to as “contracts”), 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. Id. Section 2(b) prohibits a contractor from limiting the total accrual of paid sick leave per calendar year, or at any point, at less than 56 hours. Id. Section 2(c) explains that paid sick leave earned under the Order may be used by an employee for an absence resulting from: (i) Physical or mental illness, injury, or medical condition; (ii) obtaining diagnosis, care, or preventive care from a health care provider; (iii) 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 any of the conditions or needs for diagnosis, care, or preventive care described in (i) or (ii) or is otherwise in need of care; or (iv) domestic violence, sexual assault, or stalking, if the time absent from work is for the purposes described in (i) or (ii), to obtain additional counseling, to seek relocation, to seek assistance from a victim services organization, or take related legal action, including preparation for or participation in any related civil or criminal legal proceeding, or to assist an individual related to the employee as described in (iii) in engaging in any of these activities. 80 FR 54697. Section 2(d) provides that paid sick leave shall carry over from one year to the next and shall be reinstated for employees rehired by a covered contractor within 12 months after a job separation. Id. Under section 2(e), the use of paid sick leave cannot be made contingent on the requesting employee finding a replacement to cover any work time to be missed. 80 FR 54698. Section 2(f) provides that the paid sick leave required by the Order is in addition to a contractor's obligations under the Service Contract Act and Davis-Bacon Act, and contractors may not receive credit toward their prevailing wage or fringe benefit obligations under those Acts for any paid sick leave provided in satisfaction of the Order's requirements. Id. Section 2(g) provides that an employer's existing paid sick leave policy provided in addition to the fulfillment of Service Contract Act or Davis-Bacon Act obligations, if applicable, and made available to all covered employees will satisfy the requirements of the Executive Order if the amount of paid leave is sufficient to meet the requirements of section 2 and if it may be used for the same purposes and under the same conditions described in the Executive Order. Id. Section 2(h) of the Order establishes that paid sick leave shall be provided upon the oral or written request of an employee that includes the expected duration of the leave, and is made at least 7 calendar days in advance where the need for the leave is foreseeable, and in other cases as soon as is practicable. Id. Section 2(i) addresses when a contractor may require employees to provide certification or documentation regarding the use of leave. 80 FR 54698. It provides that a contractor may only require certification issued by a health care provider for paid sick leave used for the purposes listed in sections 2(c)(i), (c)(ii), or (c)(iii) for employee absences of 3 or more consecutive workdays, to be provided no later than 30 days from the first day of the leave. Id. It further provides that if 3 or more consecutive days of paid sick leave is used for the purposes listed in section 2(c)(iv), documentation may be required to be provided from an appropriate individual or organization with the minimum necessary information establishing a need for the employee to be absent from work. Id. The Executive Order notes that the contractor shall not disclose any verification information and shall maintain confidentiality about domestic abuse, sexual assault, or stalking, unless the employee consents or when disclosure is required by law. Id. Section 2(j) states that nothing in the Order shall require a covered contractor to make a financial payment to an employee upon a separation from employment for unused accrued sick leave. 80 FR 54698. Section 2(j) further notes, however, that unused leave is subject to reinstatement as prescribed in section 2(d). Id. Section 2(k) prohibits a covered contractor from interfering with or in any other manner discriminating against an employee for taking, or attempting to take, paid sick leave as provided for under the Order, or in any manner asserting, or assisting any other employee in asserting, any right or claim related to the Order. Id. Section 2(l) states that nothing in the Order shall excuse noncompliance with or supersede any applicable Federal or State law, any applicable law or municipal ordinance, or a collective bargaining agreement requiring greater paid sick leave or leave rights than those established under the Order. Id. Section 3(a) of the Executive Order provides that the Secretary of Labor (Secretary) shall issue such regulations by September 30, 2016, as are deemed necessary and appropriate to carry out the Order, to the extent permitted by law and consistent with the requirements of 40 U.S.C. 121, including providing exclusions from the requirements set forth in the Order where appropriate; defining terms used in the Order; and requiring contractors to make, keep, and preserve such employee records as the Secretary deems necessary and appropriate for the enforcement of the provisions of the Order or the regulations thereunder. 80 FR 54698. It also requires that, to the extent permitted by law, within 60 days of the Secretary issuing such regulations, the Federal Acquisition Regulatory Council (FARC) shall issue regulations in the Federal Acquisition Regulation (FAR) to provide for inclusion in Federal procurement solicitations and contracts subject to the Executive Order the contract clause described in section 2(a) of the Order. Id. Additionally, section 3(b) states that within 60 days of the Secretary issuing regulations pursuant to the Order, agencies shall take steps, to the extent permitted by law, to exercise any applicable authority to ensure that contracts or contract-like instruments for concessions and contracts entered into with the Federal Government in connection with Federal property or lands and related to offering services for Federal employees, their dependents, or the general public, entered into after January 1, 2017, consistent with the effective date of such agency action, comply with the requirements set forth in section 2 of the Order. 80 FR 54699. Section 3(c) specifies that any regulations issued pursuant to section 3 of the Order should, to the extent practicable and consistent with section 7 of the Order, incorporate existing definitions, procedures, remedies, and enforcement processes under the Fair Labor Standards Act, 29 U.S.C. 201 et seq. (FLSA); the McNamara-O'Hara Service Contract Act, 41 U.S.C. 6701 et seq. (SCA); the Davis-Bacon Act, 40 U.S.C. 3141 et seq. (DBA); the Family and Medical Leave Act, 29 U.S.C. 2601 et seq. (FMLA); the Violence Against Women Act of 1994, 42 U.S.C. 13925 et seq. (VAWA); and Executive Order 13658, Establishing a Minimum Wage for Contractors, 79 FR 9851 (Feb. 20, 2014) (Executive Order 13658 or Minimum Wage Executive Order). Id. Section 4(a) of the Executive Order grants authority to the Secretary to investigate potential violations of and obtain compliance with the Order, including the prohibitions on interference and discrimination in section 2(k) of the Order. 80 FR 54699. Section 4(b) further explains that the Executive Order creates no rights under the Contract Disputes Act, and disputes regarding whether a contractor has provided employees with paid sick leave prescribed by the Order, to the extent permitted by law, shall be disposed of only as provided by the Secretary in regulations issued pursuant to the Order. Id. Section 5 of the Executive Order establishes that if any provision of the Order, or applying such provision to any person or circumstance, is held to be invalid, the remainder of the Order and the application of the provisions of such to any person or circumstances shall not be affected thereby. Id. Section 6(a) of the Executive Order provides that nothing in the Order shall be construed to impair or otherwise affect (i) the authority granted by law to an executive department, agency, or the head thereof; or (ii) the functions of the Director of the Office of Management and Budget (OMB) relating to budgetary, administrative, or legislative proposals. 80 FR 54699. Section 6(b) states that the Order is to be implemented consistent with applicable law and subject to the availability of appropriations. Id. Section 6(c) explains that the Order is not intended to, and does not, create any right or benefit, substantive or procedural, enforceable at law or in equity by any party against the United States, its departments, agencies, or entities, its officers, employees, or agents, or any other person. Id. Section 6(d) of the Executive Order establishes that the Order shall apply only to a new contract or contract-like instrument, as defined by the Secretary in the regulations issued pursuant to section 3(a) of the Order, if: (i) (A) It is a procurement contract for services or construction; (B) it is a contract or contract-like instrument for services covered by the Service Contract Act; (C) it is a contract or contract-like instrument for concessions, including any concessions contract excluded by Department of Labor (the Department) regulations at 29 CFR 4.133(b); or (D) it is a contract or contract-like instrument entered into with the Federal Government in connection with Federal property or lands and related to offering services for Federal employees, their dependents, or the general public; and (ii) the wages of employees under such contract or contract-like instrument are governed by the DBA, SCA, or FLSA, including employees who qualify for an exemption from the FLSA's minimum wage and overtime provisions. 80 FR 54699. Section 6(e) states that, for contracts or contract-like instruments covered by the SCA or DBA, the Order shall apply only to contracts or contract-like instruments at the thresholds specified in those statutes. 80 FR 54699-700. Additionally, Section 6(e) provides that for procurement contracts in which employees' wages are governed by the FLSA, the Order shall apply only to contracts or contract-like instruments that exceed the micro-purchase threshold, as defined in 41 U.S.C. 1902(a), unless expressly made subject to the Order pursuant to regulations or actions taken under section 3 of the Order. 80 FR 54700. Section 6(f) specifies that the Order shall not apply to grants; contracts and agreements with and grants to Indian Tribes under the Indian Self-Determination and Education Assistance Act (Pub. L. 93-638), as amended; or any contracts or contract-like instruments expressly excluded by the regulations issued pursuant to section 3(a) of the Order. Id. Section 6(g) strongly encourages independent agencies to comply with the Order's requirements. Id. Section 7(a) of the Executive Order provides that the Order is effective immediately and shall apply to covered contracts where the solicitation for such contract has been issued, or the contract has been awarded outside the solicitation process, on or after: (i) January 1, 2017, consistent with the effective date for the action taken by the FARC pursuant to section 3(a) of the Order; or (ii) January 1, 2017, for contracts where an agency action is taken pursuant to section 3(b) of the Order, consistent with the effective date for such action. 80 FR 54700. Section 7(b) specifies that the Order shall not apply to contracts or contract-like instruments that are awarded, or entered into pursuant to solicitations issued, on or before the effective date for the relevant action taken pursuant to section 3 of the Order. Id. II. Discussion of Final Rule A. Legal Authority The President issued Executive Order 13706 pursuant to his authority under “the Constitution and the laws of the United States of America,” expressly including 40 U.S.C. 121, a provision of the Federal Property and Administrative Services Act (Procurement Act). 80 FR 54697. The Procurement Act authorizes the President to “prescribe policies and directives that [the President] considers necessary to carry out” the statutory purposes of ensuring “economical and efficient” government procurement and administration of government property. 40 U.S.C. 101, 121(a). Executive Order 13706 delegates to the Secretary the authority to issue regulations “deemed necessary and appropriate to carry out this order.” 80 FR 54698. The Secretary has delegated his authority to promulgate these regulations to the Administrator of the WHD. Secretary's Order 01-2014 (Dec. 19, 2014), 79 FR 77527 (published Dec. 24, 2014). B. Comments Received On February 25, 2016, the Department published a Notice of Proposed Rulemaking (NPRM) in the Federal Register , inviting public comments on a proposal to implement the provisions of Executive Order 13706, which were to be submitted by March 28, 2016. See 81 FR 9592. On March 14, 2016, the Department extended the period for submitting written comments until April 12, 2016. See 81 FR 13306. More than 35,000 individuals and entities commented on the Department's NPRM. Comments were received from a variety of interested stakeholders, such as labor organizations; contractors and contractor associations; worker advocates; advocacy groups focused on issues affecting women, children, seniors, and the LGBT community; Members of Congress; local government agencies; small businesses; and workers. The vast majority of comments received came from individuals who submitted materially identical comments through interested organizations. For example, 9,025 individuals submitted essentially identical comments in support of, or joined, a comment submitted by the National Partnership for Women & Families (National Partnership) in favor of the rule, and Organizing for Action submitted a comment in support of the rule signed by 20,853 individuals. The Department received many comments, such as those submitted by the Center for American Progress (CAP), Jobs With Justice, the Service Employees International Union (SEIU), the American Federation of Labor and Congress of Industrial Organizations (AFL-CIO), the National Women's Law Center (NWLC), A Better Balance, North America's Building Trades Unions (Building Trades), the National Employment Law Project (NELP), Pride at Work, The Leadership Conference on Civil and Human Rights, Lambda Legal, Demos, the Center for Law and Social Policy (CLASP), and 73 U.S. Senators and Representatives expressing support for establishing paid sick leave for employees of Federal contractors. For instance, the AFL-CIO agreed with the Order's policy rationale that providing access to paid sick leave improves the health and performance of Federal contractor employees, and the Leadership Conference on Civil and Human Rights wrote that providing paid sick leave means fewer employees will be forced to make difficult choices between their jobs and their health or the health of their families. The Department also received submissions from a number of commenters, including the U.S. Chamber of Commerce and the International Franchise Association (Chamber/IFA), Associated General Contractors of America (AGC), the Professional Services Council (PSC), the Equal Employment Advisory Council (EEAC), and Associated Builders and Contractors, Inc. (ABC), expressing opposition to the Order, many describing its requirements as burdensome for contractors. Some of these commenters also questioned the President's authority to issue the Order, which is a subject outside the purview of this rulemaking. Many commenters expressed reactions to, offered suggestions regarding, or posed questions about specific provisions in the proposed regulations. The Department will address such comments in the section-by-section analysis of the Final Rule below. C. Effective Date The Department received comments requesting that the effective date of this Final Rule be delayed. AGC requested that the Final Rule apply only to contracts resulting from solicitations issued no earlier than one year after the date of the rule's publication in the Federal Register ; the American Benefits Council asked for a “grace period” of 1 year before contractors were responsible for compliance with the Order; and TrueBlue, Inc. asked that the rule's effective date be 1 year after its publication. The General Contractors Association of Hawaii, Master Sheet Metal, Inc., and Alan Shintani, Inc. also requested a delay in the effective date beyond January 1, 2017. Because the Order itself specifically designates a date as of which its requirements apply to covered contracts, the Department does not believe it is appropriate to generally delay its effective date. (A specific, temporary exception from the Order's requirements for employees performing work subject to the terms of a collective bargaining agreement is discussed in the section of this preamble addressing § 13.4.) As such, this Final Rule is effective as indicated in the Dates section above, and shall apply to covered contracts where the solicitation for such contract has been issued, or the contract has been awarded outside the solicitation process, on or after January 1, 2017. D. Discussion of the Final Rule After considering all timely and relevant comments received in response to the February 25, 2016 NPRM, the Department is issuing this Final Rule to implement the provisions of Executive Order 13706. The Final Rule, which amends Title 29 of the Code of Federal Regulations (CFR) by adding part 13, establishes standards and procedures for implementing and enforcing Executive Order 13706. Subpart A of part 13 addresses general matters, including the purpose and scope of the rule, sets forth definitions of terms used in part 13, and describes the types of contracts and employees covered by the Order and part 13 and excluded from such coverage. It describes the paid sick leave requirements for contractors established by the Executive Order, including rules and restrictions regarding the accrual and use of such leave. It also prohibits interference with the accrual or use of paid sick leave provided pursuant to the Executive Order or part 13 and discrimination for the exercise of rights under the Executive Order or part 13, and it addresses failure to comply with the recordkeeping requirements of part 13. Finally, subpart A includes a prohibition against waiver of rights and a new provision regarding multiemployer plans and other plans, funds, or programs to provide paid sick leave. Subpart B establishes the obligations of the Federal Government (specifically, contracting agencies and the Department) under the Order, and subpart C establishes the obligations of contractors under the Order, including recordkeeping requirements. Subparts D and E specify standards and procedures related to alleged violations of the Order and part 13, including complaint intake, investigations, remedies, and administrative enforcement proceedings. Appendix A contains a contract clause to implement Executive Order 13706. The following section-by-section discussion of this Final Rule presents the contents of each section in more detail, summarizes and responds to comments received about specific provisions, and describes the Final Rule as adopted, including by noting and explaining modifications from the proposed rule. Subpart A—General Subpart A of part 13 summarizes the purpose of the rule, defines terms used in the rule, describes the types of contracts and employees covered by and excluded from the rule, and sets forth rules and restrictions regarding the accrual and use of paid sick leave. Subpart A also prohibits interference with the accrual or use of the paid sick leave required by, and discrimination for the exercise of rights under, the Executive Order or part 13, as well as violations of the recordkeeping requirements of part 13. Additionally, subpart A includes a prohibition against waiver of rights and a new provision regarding multiemployer plans and other plans, funds, or programs to provide paid sick leave. Section 13.1 Purpose and Scope Proposed § 13.1(a) explained that the purpose of the rule is to implement Executive Order 13706 and reiterated statements from the Order that the Federal Government's procurement interests in economy and efficiency are promoted when the Federal Government contracts with sources that provide paid sick leave to their employees. It explained that the Order states that providing access to paid sick leave will improve the productivity of employees by improving their health and performance and will bring benefits packages offered by Federal contractors in line with model employers, ensuring they remain competitive in the search for dedicated and talented employees. Proposed § 13.1(a) stated that it is for these reasons that the Executive Order concludes that the provision of paid sick leave under the Order will generate savings and quality improvements in the work performed by parties who contract with the Federal Government, thereby leading to improved economy and efficiency in Government procurement. The Department believes that, by increasing the quality and efficiency of services provided to the Federal Government, the Executive Order will improve the value that taxpayers receive from the Federal Government's investment. The Department did not receive comments regarding § 13.1(a) in particular, and, as noted above, comments questioning the President's authority to issue Executive Order 13706 are outside of the scope of this rulemaking. This provision is therefore adopted as proposed. Proposed § 13.1(b) set forth the general position of the Federal Government that providing access to paid sick leave on Federal contracts will increase efficiency and cost savings for the Federal Government, and it explained the general requirement established in Executive Order 13706 that new contracts with the Federal Government include a clause, which the contractor and any subcontractors shall incorporate into lower-tier subcontracts, requiring, as a condition of payment, that the contractor and any subcontractors provide paid sick leave to employees in the amount of not less than 1 hour of paid sick leave for every 30 hours worked on or in connection with covered contracts. The final sentence of proposed § 13.1(b) also specified that nothing in Executive Order 13706 or part 13 would excuse noncompliance with or supersede any applicable Federal or State law, any applicable law or municipal ordinance, or a collective bargaining agreement (CBA) requiring greater paid sick leave or leave rights than those established under the Order or part 13. The Department did not receive comments regarding § 13.1(b) and adopts the provision largely as proposed, except for one change that has no substantive effect: Deletion of the final sentence, because identical language appears in § 13.5(f)(1). Proposed § 13.1(c) outlined the scope of the proposed rule and provided that neither Executive Order 13706 nor part 13 created any rights under the Contract Disputes Act or created any private right of action. As noted in the NPRM, the Department does not interpret the Executive Order as limiting existing rights under the Contract Disputes Act. Proposed § 13.1(c) also implemented the directive in section 4(b) of the Order that disputes regarding whether a contractor has provided paid sick leave as prescribed by the Order, to the extent permitted by law, shall be disposed of only as provided by the Secretary in regulations issued under the Order. The proposed provision specified, however, that nothing in the Order or part 13 was intended to limit or preclude a civil action under the False Claims Act, 31 U.S.C. 3730, or criminal prosecution under 18 U.S.C. 1001. Finally, this proposed paragraph specified that neither the Order nor part 13 would preclude judicial review of final decisions by the Secretary in accordance with the Administrative Procedure Act, 5 U.S.C. 701 et seq. No commenters addressed this provision, and the Department adopts it as proposed. Section 13.2 Definitions Proposed § 13.2 defined terms for purposes of part 13. Section 3(c) of the Executive Order instructs that any regulations issued pursuant to the Order should “incorporate existing definitions” under the FLSA, SCA, DBA, FMLA, VAWA, and Executive Order 13658 “to the extent practicable and consistent with section 7 of this order.” 80 FR 54699. Because of the similarities in language, structure, and intent of the Minimum Wage Executive Order and Executive Order 13706, many of the definitions provided in the proposed rule were identical to or based on definitions promulgated in the Minimum Wage Executive Order Final Rule, which in turn were largely based on the definitions of relevant terms set forth in the statutory text or implementing regulations of the FLSA, SCA, or DBA. In addition, some definitions were based on definitions published by the FARC in section 2.101 of the FAR, 48 CFR 2.101, and others were based on definitions set forth in the Department's regulations implementing Executive Order 13495, Nondisplacement of Qualified Workers Under Service Contracts (Executive Order 13495 or Nondisplacement Executive Order), at 29 CFR 9.2. 79 FR 60637. Definitions in the proposed rule that were relevant because of provisions of Executive Order 13706 that do not appear in Executive Order 13658 were largely based on definitions set forth in the statutory text or implementing regulations of the FMLA or the VAWA, as well as regulations issued by the U.S. Office of Personnel Management (OPM) at 5 CFR part 630, subparts B and D, which govern the accrual and use of sick leave by employees of the Federal Government. As explained in the NPRM, the definitions discussed below will govern the implementation and enforcement of Executive Order 13706. Nothing in this Final Rule is intended to alter the meaning of or to be interpreted inconsistently with the definitions set forth in section 2.101 of the FAR for purposes of that regulation. The Department proposed to define accrual year to mean the 12-month period during which a contractor may limit an employee's accrual of paid sick leave to no less than 56 hours. No commenters suggested revising this definition, and it is adopted as proposed. The Department proposed to define the term Administrative Review Board as the Administrative Review Board within the U.S. Department of Labor. The Department received no comments addressing this definition, and it is adopted as proposed. The Department proposed to define the term Administrator to mean the Administrator of the Wage and Hour Division and to include any official of the Wage and Hour Division authorized to perform any of the functions of the Administrator under part 13. The Department received no comments regarding this definition and adopts it as proposed. The Department proposed to define as soon as is practicable to mean as soon as both possible and practical, taking into account all of the facts and circumstances of the individual case. This definition was derived from the definition of “as soon as practicable” in the FMLA regulations. 29 CFR 825.302(b). Although the Department received comments regarding the application of this term, as described in the discussion of § 13.5(d) below, the Department did not receive comments requesting changes to this definition and therefore implements it without modification. The Department proposed to define certification issued by a health care provider as any type of written document created or signed by a health care provider (or by a representative of the health care provider) that contains information verifying the existence of the physical or mental illness, injury, medical condition, or need for diagnosis, care, or preventive care or other need for care referred to in proposed § 13.5(c)(1)(i), (ii), or (iii). The proposed definition allowed employees to provide as certification a greater range of documents than would suffice to demonstrate the existence of a serious health condition for purposes of the FMLA. See 29 CFR 825.305, 825.306. For example, under the proposal, a note from a hospital nurse stating that an employee needed surgery and would require at least 3 days to recover before returning to work would meet the definition, as would a note from an employee's parent's doctor stating that the parent needs daily assistance with tasks such as dressing and eating. EEAC commented that employees should be required to provide as much information to certify the use of paid sick leave as is necessary to certify the use of FMLA leave; on the other hand, the Center for WorkLife Law at the University of California, Hastings College of Law (Center for WorkLife Law) commented that the Department should require no specificity in the certification beyond the fact that a medical or health condition exists, because such a statement is sufficient to prevent employee abuse of leave and would avoid inviting the contractor to inappropriately evaluate whether a particular condition justifies the use of paid sick leave. The Department declines to adopt either suggestion. With respect to EEAC's comment, the Department notes that the reasons for which an employee may use FMLA leave are significantly more limited than the permissible uses of paid sick leave under the Order and part 13, and it is therefore logical that the information required to justify the use of FMLA leave correspondingly reflects a higher threshold than is called for in using paid sick leave. But neither does the Department agree that a simple statement that an employee (or an employee's family member) has a medical or health issue would constitute the type of certification contemplated in the Executive Order. As the examples above indicate, the Department believes that great specificity regarding the medical or health issue is not required; a health care provider's note referring to surgery need not explain what condition the surgery treated or the specifics of the procedure, and a note from a doctor regarding a physical or mental condition (such as a broken leg or dementia) that causes a need for caretaking need not provide specific details about the parent's condition or the specific tasks with which assistance is required. In the discussion of this definition in the NPRM, the Department noted that a contractor could not require that an employee or the individual for whom the employee is caring have seen the health care provider in person in order to accept the certification. The Department did not receive comments regarding this interpretation. For purposes of clarity, it has included language in the final regulatory text making the point that the health care provider (or representative) need not have seen the employee or individual in person in order to create a valid certification. In the NPRM, the Department proposed to define child to mean (1) a biological, adopted, step, or foster son or daughter of the employee; (2) a person who is a legal ward or was a legal ward of the employee when that individual was a minor or required a legal guardian; (3) a person for whom the employee stands in loco parentis or stood in loco parentis when that individual was a minor or required someone to stand in loco parentis; or (4) a child, as described in paragraphs (1) through (3) of the definition, of an employee's spouse or domestic partner. The NPRM explained that this definition was adopted from the definition of “son or daughter” in the OPM regulations governing leave for Federal employees. 5 CFR 630.201(b). The Department noted that the proposed definition was deliberately broader than the definition of “son or daughter” in the FMLA, which includes only minor children or adult children “incapable of self-care because of a mental or physical disability.” 29 CFR 825.102. As the Department explained in the NPRM, the terms of the Executive Order make clear that employees are to be permitted to use paid sick leave for a broader range of purposes than those for which they can use FMLA leave, and one such more expansive use is to care for an employee's child of any age. EEAC commented that the Department should use as its definition of “child” the definition of “son or daughter” from the FMLA, asserting that an employee should not be able to use paid sick leave to care for adult children who are not incapable of self-care or the child of a spouse or domestic partner who is not also the employee's child. A comment from scholars affiliated with the Williams Institute at the UCLA School of Law, however, specifically supported the definition's inclusion of a child who is the employee's spouse or domestic partner's son or daughter but not legally recognized as the employee's child. Because the Department interprets the list of family members for whom an employee may use paid sick leave to care in section 2(c)(iii) of the Order as being deliberately broad and inclusive, see 80 FR 54697 (permitting the use of paid sick leave to care 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”)—and in particular because the list so plainly deviates from the more limited list in the FMLA, see 29 U.S.C. 2612(a)(1)(C) (permitting the use of FMLA leave “to care for the spouse, or a son, daughter, or parent, of the employee”)—the Department adopts the inclusive definition of child as proposed. The Department proposed a definition of concessions contract or contract for concessions identical to the definition of those terms in the Minimum Wage Executive Order Final Rule. See 79 FR 60722 (codified at 29 CFR 10.2). Specifically, the Department proposed to define the term as a contract under which the Federal Government grants a right to use Federal property, including land or facilities, for furnishing services, and included as examples of such contracts those the principal purpose of which is to furnish food, lodging, automobile fuel, souvenirs, newspaper stands, and/or recreational equipment. The Department noted that the proposed definition was not limited based on the beneficiary of the services but rather that it encompassed contracts regardless of whether they are of direct benefit to the Federal Government, its property, its civilian or military personnel, or the general public. See 29 CFR 4.133; see also 79 FR 60638. The NPRM noted that the proposed definition included, but was not limited to, all concessions contracts excluded by Departmental regulations under the SCA at 29 CFR 4.133(b). See 79 FR 60638. No commenters addressed the definition of concessions contract or contract for concessions, and the Department adopts the definition as proposed. The Department proposed to define contract and contract-like instrument collectively for purposes of the Executive Order in the same manner as it did in the Minimum Wage Executive Order implementing regulations. See 79 FR 60722 (codified at 29 CFR 10.2). Specifically, the NPRM defined a contract or contract-like instrument as an agreement between two or more parties creating obligations that are enforceable or otherwise recognizable at law. The proposed definition included, but was not limited to, a mutually binding legal relationship obligating one party to furnish services (including construction) and another party to pay for them. The proposed definition of the term contract broadly included all contracts and any subcontracts of any tier thereunder, whether negotiated or advertised, including any procurement actions, lease agreements, cooperative agreements, provider agreements, intergovernmental service agreements, service agreements, licenses, permits, or any other type of agreement, regardless of nomenclature, type, or particular form, and whether entered into verbally or in writing. The proposed definition of the term contract was interpreted broadly to include, but not be limited to, any contract that may be consistent with the definition provided in the FAR or applicable Federal statutes. The proposed definition further included, but was not limited to, any contract that may be covered under any Federal procurement statute. The Department specifically noted in the proposed definition that contracts may be the result of competitive bidding or awarded to a single source under applicable authority to do so. The proposed definition also explained that, in addition to bilateral instruments, contracts included, but were not limited to, awards and notices of awards; job orders or task letters issued under basic ordering agreements; letter contracts; orders, such as purchase orders, under which the contract becomes effective by written acceptance or performance; and bilateral contract modifications. The proposed definition also specified that the term contract included contracts covered by the SCA, contracts covered by the DBA, concessions contracts not subject to the SCA, and contracts in connection with Federal property or lands and related to offering services for Federal employees, their dependents, or the general public. As explained in the Minimum Wage Executive Order rulemaking, the proposed definition of contract was derived from the definition of the term contract set forth in Black's Law Dictionary (9th ed. 2009) and section 2.101 of the FAR (48 CFR 2.101), as well as the descriptions of the term contract that appear in the SCA's regulations at 29 CFR 4.110-4.111 and 4.130. See 79 FR 60638-41. The Department's proposal deliberately adopted a broad definition of this term, but noted that the mere fact that a legal instrument constitutes a contract would not mean that such contract is subject to the Executive Order. In order for a contract to be covered by the Executive Order and part 13, the contract must (1) qualify as a contract or contract-like instrument; (2) fall within one of the specifically enumerated types of contracts set forth in section 6(d)(i) of the Order and § 13.3; and (3) be a new contract. Therefore, the NPRM explained that, for example, although a cooperative agreement was a contract under the Department's proposed definition, a cooperative agreement would not be covered by the Executive Order and part 13 unless it was a new contract and was subject to the SCA or DBA, was a concessions contract, or was entered into in connection with Federal property or lands and related to offering services for Federal employees, their dependents, or the general public. The Department did not receive any comments requesting a change to this proposed definition, and it therefore adopts it as proposed. One commenter, Bodman PLC, asked for clarification of whether, based on the broad definition of contract, a financial institution that holds deposits insured by the Federal Deposit Insurance Corporation or the National Credit Union Administration would be covered by the Order and part 13. A contract with the Federal Government is not covered by the Order and this rulemaking unless it is one of the types of covered contracts named in the Order and further described in § 13.3 and the accompanying explanation in this preamble. Unless the types of agreements to which the commenter referred are procurement contracts for construction covered by the DBA, contracts for services covered by the SCA, contracts for concessions, or contracts in connection with Federal property or lands and related to offering services for Federal employees, their dependents, or the general public, the Order does not cover them. Furthermore, as explained below, with respect to the fourth category of covered contracts, the Department does not interpret “Federal property” to encompass money, and therefore purely financial transactions with the Federal Government are not covered by the Order or part 13. The Department proposed to define contracting officer based on the definition used in 29 CFR 10.2, issued pursuant to the Minimum Wage Executive Order, which in turn was adopted from the definition in section 2.101 of the FAR. See 79 FR 60641 (citing 48 CFR 2.101). As proposed, the term meant a representative of an executive department or agency with the authority to enter into, administer, and/or terminate contracts and make related determinations and findings. The term also included certain authorized representatives of the contracting officer acting within the limits of their authority as delegated by the contracting officer. The Department received no comments regarding this definition and adopts it as proposed. The Department proposed to define contractor to mean any individual or other legal entity that is awarded a Federal Government contract or a subcontract under a Federal Government contract. The proposed definition referred to both a prime contractor and all of its first- or lower-tier subcontractors on a contract with the Federal Government. It also included lessors and lessees. The Department noted that the term employer was used interchangeably with the terms contractor and subcontractor in part 13. The proposed definition also explained that the U.S. Government, its agencies, and its instrumentalities are not considered contractors, subcontractors, employers, or joint employers for purposes of compliance with the provisions of Executive Order 13706. The proposed definition, which was derived from the definition adopted in the Minimum Wage Executive Order rulemaking, see 79 FR 60722 (codified at 29 CFR 10.2), incorporated relevant aspects of the definitions of the term contractor in section 9.403 of the FAR, see 48 CFR 9.403; the SCA regulations at 29 CFR 4.1a(f); and the Department's regulations implementing the Nondisplacement Executive Order at 29 CFR 9.2. The proposed definition differed from the Minimum Wage Executive Order only in that it did not refer to employers of employees performing work on covered Federal contracts whose wages are computed pursuant to special certificates issued under 29 U.S.C. 214(c). The Department noted in the NPRM that although such employers would be contractors for purposes of Executive Order 13706, such a reference was not called for in the proposed definition because, unlike the Minimum Wage Executive Order, this Order does not contain any explicit reference to employees whose wages are computed pursuant to section 14(c) certificates. No commenters addressed this definition, and it is adopted as proposed. The Department proposed to define the term Davis-Bacon Act to mean the Davis-Bacon Act of 1931, as amended, 40 U.S.C. 3141 et seq., and its implementing regulations. This definition is adopted as proposed. The Department proposed to define the term domestic partner to mean an adult in a committed relationship with another adult. The proposed definition included both same-sex and opposite-sex relationships. The Department proposed to further explain that a committed relationship was one in which the employee and the domestic partner of the employee are each other's sole domestic partner (and are not married to or domestic partners with anyone else) and share responsibility for a significant measure of each other's common welfare and financial obligations. The proposed definition included, but was not limited to, any relationship between two individuals of the same or opposite sex that is granted legal recognition by a State or by the District of Columbia as a marriage or analogous relationship (including, but not limited to, a civil union). The proposed definition was adopted from the definitions of “domestic partner” and “committed relationship” in the OPM regulations regarding the use of sick leave by Federal employees. 5 CFR 630.201(b). The Department received a number of comments, including from Pride at Work, the Los Angeles LGBT Center, CAP, and Lambda Legal, largely supporting this proposed definition but also asking that it be clarified. Specifically, these organizations wrote that they have “a concern regarding the requirement that domestic partners share responsibility for a significant measure of each other's financial obligations” because for many couples, only one individual earns an income that supports both partners, and “the regulations should be clear that such couples are not excluded from the definition of domestic partners or committed relationship solely because only one partner earns income that they both depend upon.” The Department did not intend its proposed definition to imply that only if both members of a couple earn an income would that couple be considered domestic partners. Rather, the language regarding sharing responsibility for financial obligations could refer to a variety of circumstances, such as but not limited to one member of the couple paying for the housing and other necessities of the other, the couple having joint bank accounts, the couple sharing significant expenses, and/or the couple being jointly responsible for financial obligations such as mortgage or other loan payments. In other words, rather than calling for any particular financial arrangement, the financial interdependence clause of the definition is meant to indicate that the couple's financial situation reflects that the relationship is a committed one, rather than, for example, a casual roommate situation. See Final Rule, Absence and Leave; Definitions of Family Member, Immediate Relative, and Related Terms, 75 FR 33491, 33493-94 (June 14, 2010) (OPM's discussion of the term “committed relationship,” noting that its definition “would preclude casual roommates from qualifying as each other's domestic partner”). Because the Department's language is consistent with OPM's and does not have the meaning about which the commenters were concerned, the Department adopts the definition of domestic partner as proposed. The Department proposed to define domestic violence as (1) felony or misdemeanor crimes of violence (including threats or attempts) committed: (i) by a current or former spouse, domestic partner, or intimate partner of the victim; (ii) by a person with whom the victim shares a child in common; (iii) by a person who is cohabitating with or has cohabitated with the victim as a spouse, domestic partner, or intimate partner; (iv) by a person similarly situated to a spouse of the victim under domestic or family violence laws of the jurisdiction in which the victim resides or the events occurred; or (v) by any other adult person against a victim who is protected from that person's acts under the domestic or family violence laws of the jurisdiction in which the victim resides or the events occurred. Under the proposed definition, domestic violence also included (2) any crime of violence considered to be an act of domestic violence according to State law. This definition was derived from the VAWA, 42 U.S.C. 13925(a)(8), and its implementing regulations, 28 CFR 90.2(a). In its comment, the Women's Law Project expressed concern that this definition only refers to acts that are considered to be domestic violence for purposes of criminal laws rather than also including acts that constitute domestic violence for purposes of civil laws, in particular those allowing for civil protection orders. Because the Department did not intend for this definition to be narrow or exclude any subset of victims of acts that a State considers to constitute domestic violence, it is adopting the definition with the revisions suggested by the Women's Law Project. Specifically, in the fourth and fifth lines of the first part of the definition, the Department is inserting “civil or criminal” before “domestic and family violence laws,” and in the second part of the definition, the Department is replacing “according to State law” with “under the civil or criminal domestic or family violence laws of the jurisdiction in which the victim resides or the events occurred,” the same phrase used in the first part of the definition. The Department proposed to define employee similarly to the way the term worker was used in the Minimum Wage Executive Order rulemaking, see 79 FR 60723, but with some differences reflecting the differences in the text of that Executive Order and Executive Order 13706. As proposed, the term meant any person engaged in performing work on or in connection with a contract covered by the Executive Order, and whose wages under such contract are governed by the SCA, DBA, or FLSA, including employees who qualify for an exemption from the FLSA's minimum wage and overtime provisions, regardless of the contractual relationship alleged to exist between the individual and the employer. Furthermore, the term employee included any person performing work on or in connection with a covered contract and individually registered in a bona fide apprenticeship or training program registered with the U.S. Department of Labor's Employment and Training Administration, Office of Apprenticeship, or with a State Apprenticeship Agency recognized by the Office of Apprenticeship. Much of this proposed definition came directly from section 6(d)(ii) of the Executive Order, and much of it was identical to the definition of worker in the Minimum Wage Executive Order regulations. The most significant difference between the proposed definition of employee and the Minimum Wage Executive Order rulemaking's definition of worker was the inclusion of employees who qualify for an exemption from the FLSA's minimum wage and overtime provisions, such as employees employed in a bona fide executive, administrative, or professional capacity, as those terms are defined in 29 CFR part 541. Comments regarding the application of the Order and part 13 to such employees are addressed below, in the discussion of coverage of employees under § 13.3; for the reasons explained there, the Department adopts the relevant portion of this definition as proposed. The proposed definition also emphasized, as had been explained in the Minimum Wage Executive Order rulemaking, the well-established principle under the DBA, SCA, and FLSA that employee coverage does not depend upon the existence or form of any contractual relationship that may be alleged to exist between the contractor or subcontractor and such persons. See 79 FR 60644 (citing 29 U.S.C. 203(d), (e)(1), (g) (FLSA); 41 U.S.C. 6701(3)(B), 29 CFR 4.155 (SCA); 29 CFR 5.5(a)(1)(i) (DBA)). As reflected in the proposed definition, the Executive Order is intended to apply to a wide range of employment relationships. Neither an individual's subjective belief about his or her employment status nor the existence of a contractual relationship is determinative of whether an employee is covered by the Executive Order. EEAC and AGC remarked on the breadth of the proposed rule's statements about coverage of independent contractors, and AGC, Master Sheet Metal, Inc., General Contractors Association of Hawaii, and TrueBlue, Inc. specifically requested clarification that the rule does not apply to independent contractor owner-operators or sole proprietors to the extent they are not subject to SCA or DBA prevailing wage requirements. Although the Department reiterates its statement that allegations of a contractual relationship or the existence of a contract are not determinative of whether a worker is an employee or an independent contractor, it clarifies its statements about the effect of a worker being properly categorized as an independent contractor here. Whether a worker is an “employee” or an “independent contractor” as those terms are often used in other contexts is not material to whether that worker is a service employee for purposes of the SCA or a laborer or mechanic for purposes of the DBA. See, e.g., 29 CFR 4.155 (SCA); 29 CFR 5.5(a)(1)(i) (DBA); In re Igwe, ARB Case No. 07-120, 2009 WL 4324725, at *3-4 (Nov. 25, 2009) (rejecting an argument that “the individuals working on the four contracts were not entitled to SCA prevailing wages and fringe benefits because they were independent contractors, not employees” because “the relevant inquiry is whether the persons working on the contract come within the SCA definition of `service employee'” and explaining “the irrelevance of `contractual relationship' to that definition”). Because even workers who are independent contractors may be covered by the SCA and DBA, those workers, if so covered, are employees for purposes of the Order and part 13. A worker who is not a service employee for purposes of the SCA or a laborer or mechanic for purposes of the DBA and who is not an employee under the FLSA, however, is not covered by the Order or part 13. (The Department notes that an employee who qualifies for an exemption from the FLSA's minimum wage and overtime requirements is still an employee rather than an independent contractor; as explained elsewhere, employees who qualify for such exemptions are covered by the Order and part 13.) More specifically, owner-operators (such as owner-operator truck drivers) and sole proprietors are not covered by the Executive Order and part 13 to the extent they are not entitled to prevailing wages under the DBA or SCA and are properly classified as independent contractors whose wages are not governed by the FLSA. The Department's guidance regarding the classification of workers as independent contractors under the FLSA is available on the WHD Web site, http://www.dol.gov/whd . The proposed definition's inclusion of any person performing work on or in connection with a covered contract and individually registered in a bona fide apprenticeship or training program registered with the Department's Employment and Training Administration, Office of Apprenticeship, or with a State Apprenticeship Agency recognized by the Office of Apprenticeship, was similarly in keeping with the Minimum Wage Executive Order's adoption of those provisions from the SCA and DBA regulations. See 79 FR 60644 (citing 29 CFR 4.6(p) (SCA); 29 CFR 5.2(n) (DBA)). The Department received no comments regarding this portion of the proposed definition and has adopted it as proposed. The Department noted in the NPRM that, because unlike the Minimum Wage Executive Order, Executive Order 13706 makes no reference to individuals performing work on or in connection with a covered contract whose wages are calculated pursuant to special certificates issued under 29 U.S.C. 214(c), that category of employees was not explicitly mentioned in the proposed definition. It further explained that such individuals would nevertheless plainly fall within the definition of employee for purposes of this rulemaking because their wages are governed by the FLSA. The AFL-CIO and SEIU supported the Department's inclusion of such workers, and the Department makes no change to this implication of the definition. Finally, the Department has added language to this definition explaining the meaning of working “on or in connection with” a covered contract. Specifically, the definition now provides that an employee performs “on” a contract if the employee directly performs the specific services called for by the contract and that an employee performs “in connection with” a contract if the employee's work activities are necessary to the performance of a contract but are not the specific services called for by the contract. As noted in the more detailed discussion below of employee coverage as provided for in § 13.3, these concepts were explained in the NPRM but were not included in the regulatory text itself. The Department proposed to define executive departments and agencies for purposes of this rulemaking by adopting the definition of that term used in the Minimum Wage Executive Order rulemaking, which was derived from the definition of executive agency provided in section 2.101 of the FAR, 48 CFR 2.101. 79 FR 60642, 60722 (codified at 29 CFR 10.2). The Department therefore proposed to interpret the Executive Order to apply to executive departments within the meaning of 5 U.S.C. 101, military departments within the meaning of 5 U.S.C. 102, independent establishments within the meaning of 5 U.S.C. 104(1), and wholly owned Government corporations within the meaning of 31 U.S.C. 9101. The Department did not interpret this definition as including the District of Columbia or any Territory or possession of the United States. Bredhoff & Kaiser, PLLC submitted a comment on behalf of the National Postal Mail Handlers Union urging the Department to ensure that the Executive Order and part 13 apply to covered contracts with the U.S. Postal Service. Although the proposed rule did not identify any particular entities that would or would not have qualified as executive departments and agencies, its definition of that term referred to, among other types of entities, independent establishments within the meaning of 5 U.S.C. 104(1). That statutory provision expressly excludes the U.S. Postal Service. The Department agrees with the commenter that the Executive Order, which contains no indication that the U.S. Postal Service is not among the governmental entities the contracts of which may be covered, is best interpreted to apply to covered contracts with the U.S. Postal Service. The Minimum Wage Executive Order rulemaking did not address the implications of its adoption of the FAR's definition of executive departments and agencies, including its reference to independent establishments within the meaning of 5 U.S.C. 104(1) generally or coverage of the U.S. Postal Service specifically; there is no indication in the rulemaking that any commenter asked that the Department expand coverage to the U.S. Postal Service or that doing so would have had practical effect. The terms of Executive Order 13706 (as well as Executive Order 13658) indicate that contracts with the Federal Government covered by the SCA are covered by the Order, and it is clear that under the SCA, service contracts with the Federal Government covered by that Act include contracts with the U.S. Postal Service unless they are expressly excluded. See, e.g., 41 U.S.C. 6702(b)(7) (“This chapter does not apply to . . . a contract with the United States Postal Service, the principal purpose of which is the operation of postal contract stations.”). It is therefore appropriate to infer that the Executive Order was intended to apply to covered contracts with the U.S. Postal Service. Furthermore, the purpose of the Executive Order—ensuring that employees working on or in connection with covered contracts have access to paid sick leave—is best served by modifying the proposed definition to make clear that coverage extends to covered contracts with the U.S. Postal Service. Accordingly, the Department has expanded the definition of executive departments and agencies to refer to independent establishments not only within the meaning of 5 U.S.C. 104(1), but also within the meaning of 39 U.S.C. 201, which establishes the U.S. Postal Service “as an independent establishment of the executive branch of the Government of the United States.” The Department proposed to define Executive Order 13495 or Nondisplacement Executive Order to mean Executive Order 13495 of January 30, 2009, Nondisplacement of Qualified Workers Under Service Contracts, 74 FR 6103 (Feb. 4, 2009), and its implementing regulations at 29 CFR part 9. This definition is adopted as proposed. The Department proposed to define Executive Order 13658 or Minimum Wage Executive Order to mean Executive Order 13658 of February 12, 2014, Establishing a Minimum Wage for Contractors, 79 FR 9851 (Feb. 20, 2014), and its implementing regulations at 29 CFR part 10. This definition is adopted as proposed. The Department proposed to define Fair Labor Standards Act as the Fair Labor Standards Act of 1938, as amended, 29 U.S.C. 201 et seq., and its implementing regulations. This definition is adopted as proposed. The Department proposed to define Family and Medical Leave Act as the Family and Medical Leave Act of 1993, as amended, 29 U.S.C. 2601 et seq., and its implementing regulations. This definition is adopted as proposed. The Department proposed to define family violence, a term used in the definition of domestic violence, to mean any act or threatened act of violence, including any forceful detention of an individual that results or threatens to result in physical injury and is committed by a person against another individual (including an elderly individual) to or with whom such person is related by blood, is or was related by marriage or is or was otherwise legally related, or is or was lawfully residing. Because the VAWA does not provide a definition of the term, this definition was adopted from the definition of “family violence” in the Family Violence Prevention and Services Act, 42 U.S.C. 10401. See 42 U.S.C. 10402(4). The Department did not receive any comments regarding this definition and therefore adopts it as proposed. Proposed § 13.2 defined Federal Government as an agency or instrumentality of the United States that enters into a contract pursuant to authority derived from the Constitution or the laws of the United States. The proposed definition was identical to that used in the regulations implementing the Minimum Wage Executive Order. 79 FR 60722 (codified at 29 CFR 10.2). That definition was based on the definition of Federal Government set forth in 29 CFR 9.2, but eliminated the term “procurement” from that definition because Executive Order 13658 applies—as does Executive Order 13706—to both procurement and non-procurement contracts. 79 FR 60642. Consistent with the SCA, the term Federal Government under the proposal included nonappropriated fund instrumentalities under the jurisdiction of the Armed Forces or of other Federal agencies. See 29 CFR 4.107(a). The proposed definition provided that for purposes of Executive Order 13706 and part 13, Federal Government did not include the District of Columbia or any Territory or possession of the United States. As used in the Order and part 13, the term also did not include any independent regulatory agency within the meaning of 44 U.S.C. 3502(5) because such agencies are not required to comply with the Order or part 13. Bredhoff & Kaiser's comment, discussed above with respect to the definition of executive departments and agencies, suggested that the Department adjust the definition of Federal Government to ensure that this rulemaking applies to covered contracts with the U.S. Postal Service. The Department believes that the definition of Federal Government is sufficiently broad that the expansion of the definition of executive departments and agencies to include the U.S. Postal Service fulfills the purpose of making clear that the Department interprets the Order and part 13 to apply to covered contracts with the U.S. Postal Service. The Department therefore adopts the definition as proposed. The Department proposed to define health care provider as any practitioner who is licensed or certified under Federal or State law to provide the health-related service in question or any practitioner recognized by an employer or the employer's group health plan. The term included, but was not limited to, doctors of medicine or osteopathy, podiatrists, dentists, psychologists, optometrists, chiropractors, nurse practitioners, nurse-midwives, clinical social workers, physician assistants, physical therapists, and Christian Science Practitioners listed with the First Church of Christ, Scientist in Boston, Massachusetts. This definition was intended to be broad and inclusive, and the Department reiterates that the list is not exhaustive. For example, not only a nurse practitioner, but also a registered nurse or a licensed practical nurse, would fall under this definition if an employee sought a service such a practitioner was licensed or certified to provide. The definition was derived from the definitions of health care provider in the FMLA regulations, 29 CFR 825.125, and OPM regulations, 5 CFR 630.201 and 5 CFR 630.1202. EEAC was opposed to the breadth of this term, specifically suggesting that referring to “psychologists” instead of “clinical psychologists” and failing to limit “chiropractors” with the phrase “treatment consisting of manual manipulation of the spine to correct a subluxation as demonstrated by X-ray to exist” was inappropriate. Because the types of ailments and treatments for which an employee may use paid sick leave is intended to be broad, the list of practitioners is illustrative rather than restricting the types of professionals who fall within the definition, and the definition is already limited to practitioners licensed or certified under Federal or State law or recognized by an employer or the employer's group health plan, the Department does not believe the suggested changes are appropriate. Accordingly, it adopts the definition as proposed. The Department proposed to define the term independent agencies as any independent regulatory agency within the meaning of 44 U.S.C. 3502(5). Section 6(g) of the Executive Order states that “[i]ndependent agencies are strongly encouraged to comply with the requirements of this order.” The Department's proposal interpreted this provision, as it interpreted an identical provision in the Minimum Wage Executive Order, to mean that independent agencies are not required to comply with this Executive Order. See 79 FR 9853; 79 FR 60643. The proposed definition was therefore based on other Executive Orders that similarly exempt independent regulatory agencies within the meaning of 44 U.S.C. 3502(5) from the definition of agency or include language requesting that they comply. See, e.g., Executive Order 13636, 78 FR 11739 (Feb. 12, 2013) (defining agency as any executive department, military department, Government corporation, Government-controlled operation, or other establishment in the executive branch of the Government but excluding independent regulatory agencies as defined in 44 U.S.C. 3502(5)); Executive Order 13610, 77 FR 28469 (May 10, 2012) (same); Executive Order 12861, 58 FR 48255 (September 11, 1993) (“Sec. 4 Independent Agencies. All independent regulatory commissions and agencies are requested to comply with the provisions of this order.”); Executive Order 12837, 58 FR 8205 (Feb. 10, 1993) (“Sec. 4. All independent regulatory commissions and agencies are requested to comply with the provisions of this order.”). The Department received no comments regarding this definition and adopts it as proposed. The Department proposed to include in § 13.2 a definition of individual related by blood or affinity whose close association with the employee is the equivalent of a family relationship. The Department proposed to define the term to mean any person with whom the employee has a significant personal bond that is or is like a family relationship, regardless of biological or legal relationship. The NPRM noted that although this term is used in the OPM regulations, see 5 CFR 630.201 (defining “family member,” for purposes of Federal employees' use of leave, to include the term), OPM has not created a regulatory definition of it; the Department's proposed definition was, however, derived from OPM's discussion of the term in OPM's 2010 Final Rule, 75 FR 33491. In particular, OPM explained that creating an exhaustive list of the relationships that meet the definition is not possible, but that OPM has “broadly interpreted the phrase to include such relationships as grandparent and grandchild, brother- and sister-in-law, fiancé and fiancée, cousin, aunt and uncle, other relatives not specified in [the list naming a spouse, child, parent, brother, or sister], and close friend, to the extent that the connection between the employee and the individual was significant enough to be regarded as having the closeness of a family relationship even though the individuals might not be related by blood or formally in law.” 75 FR 33492. The Department explained in the NPRM that it understood the term to be inclusive of non-nuclear family structures, noting that it could include, for example, an individual who was a foster child in the same home in which the employee was a foster child for several years and with whom the employee has maintained a sibling-like relationship, a friend of the family in whose home the employee lived while she was in high school and whom the employee therefore considers to be like a mother or aunt to her, or an elderly neighbor with whom the employee has regularly shared meals and to whom the employee has provided unpaid caregiving assistance for the past 5 years and whom the employee therefore considers to be like a grandfather to her. In the NPRM, the Department sought comments regarding its proposed definition of this term, in particular regarding whether additional specificity was necessary. Numerous organizations—including but not limited to Lambda Legal, the National LGBTQ Task Force, Pride at Work, CAP, the Children's Alliance, the Family Equality Council, Equality Maine, Basic Rights Oregon, CLASP, Demos, A Better Balance, the Working Families Organization, Caring Across Generations, the Labor Project for Working Families in partnership with Family Values @ Work, and the Movement Advancement Project—strongly supported the proposed definition of this phrase. Many of these commenters noted that many Americans live in multigenerational households and LGBTQ Americans in particular often rely on “families of choice,” meaning that any specific limitations inserted into the definition could defeat the purpose of using the broad term. They also wrote that a broad definition has been successfully in place with respect to Federal employees' sick leave for years, indicating that the proposed definition would not be difficult to implement or likely to be abused. The New York City (NYC) Department of Consumer Affairs wrote about its experience enforcing a local paid sick time law and the importance of capturing, for example, an employee's fiancé or aunt in the set of people for whom the employee can take leave to care. The Main Street Alliance, a coalition of employers, wrote that using a broad definition alleviated the burden on contractors of determining whether an employee's relationship fit into some more limited set of relationships. Other commenters noted that the example included in the NPRM of the elderly neighbor was useful. Other commenters, however, did not support the proposed definition. The American Benefits Council, Seyfarth Shaw LLP, the Chamber/IFA, and Society for Human Resource Management and the College and University Professional Association for Human Resources (SHRM/CUPA-HR), for example, asked that the Department narrow the definition. Some of these commenters wrote that the definition applies more broadly than is necessary to achieve the goals of the Executive Order. Others noted that State and local paid sick time laws do not apply as broadly or that they believed it would be difficult for contractors to verify whether a relationship of the type described exists. A few commenters proposed specific replacement definitions: The Independent Electrical Contractors, Inc. (IEC) asked that the Department interpret the Order to allow an employee to use paid sick leave to care only for individuals with whom the employee has a biological or legal relationship; Koga Engineering and Construction, Royal Contracting Company LTD, Master Sheet Metal, Inc., and the General Contractors Association of Hawaii asked that this category extend only to family members for whom an employee can take FMLA leave; EEAC asked that it extend only to a “person with whom the employee has a significant personal bond that is or is like that of a child, parent or spouse”; and Vigilant asked that the Department interpret the word “affinity” to mean only a relationship by marriage. The Department carefully considered the comments received and is adopting this definition as proposed. The term has been used with respect to sick leave for Federal employees since 1994, see Final Rule, Absence and Leave; Sick Leave, 59 FR 62266, 62266-67, 62270-71 (codified at 5 CFR 630.201(b)(v)), and OPM has indicated that it has had and continues to have an expansive meaning, see 75 FR 33491-92. The Department agrees with commenters that these facts suggest that the term in the Executive Order is best interpreted to have the same meaning as the term in the OPM regulations and that OPM does not consider its use of the term to have proved unworkable. Furthermore, the Department will not depart from the plain meaning of the text, which clearly extends beyond marital relationships or those referenced in the FMLA and reflects a general intent to be broad and inclusive by adopting the specific, significantly narrower definitions some commenters suggested. The Department notes that the issue of contractor verification of employees' relationships is addressed below in the discussions of requests to use paid sick leave and certification or documentation of the need to use paid sick leave; because contractor inquiries into employees' private lives are deliberately limited, the Department does not expect such verification to be intensive or complicated. The Department proposed to define intimate partner, a term used in the definition of domestic violence, to mean a person who is or has been in a social relationship of a romantic or intimate nature with the victim, where the existence of such a relationship shall be determined based on a consideration of the length of the relationship; the type of relationship; and the frequency of interaction between the persons involved in the relationship. This definition was derived from the definition of “dating partner” in the VAWA. See 42 U.S.C. 13925(a)(9). No commenter suggested any revisions to this definition, and the Department adopts it as proposed. In the Final Rule, the Department has added a definition of multiemployer plan, because that term is used in the final regulations for reasons explained in the discussion of § 13.8. The term is defined to mean a plan to which more than one employer is required to contribute and which is maintained pursuant to one or more CBAs between one or more employee organizations and more than one employer. This definition is derived from, but not identical to, the definition of the term under the Employee Retirement Income Security Act of 1974 (ERISA), 29 U.S.C. 1001 et seq. See 29 U.S.C. 1002(37). Because of the differences between the ERISA definition and that used here, a plan could qualify as a multiemployer plan for purposes of part 13 even though it does not so qualify for purposes of ERISA. The Department proposed that the term new contract have the same meaning as in the Minimum Wage Executive Order Final Rule, but with dates altered to reflect the timing contemplated in section 7 of Executive Order 13706. See 79 FR 60722 (codified at 29 CFR 10.2); 80 FR 54700. Under the proposed definition, a new contract was a contract that results from a solicitation issued on or after January 1, 2017, or a contract that is awarded outside the solicitation process on or after January 1, 2017. This term included both new contracts and replacements for expiring contracts. It did not apply to the unilateral exercise of a pre-negotiated option to renew an existing contract by the Federal Government. The proposal explained that for purposes of the Executive Order, a contract that is entered into prior to January 1, 2017 would constitute a new contract if, through bilateral negotiation, on or after January 1, 2017: (1) The contract is renewed; (2) the contract is extended, unless the extension is made pursuant to a term in the contract as of December 31, 2016 providing for a short-term limited extension; or (3) the contract is amended pursuant to a modification that is outside the scope of the contract. The Minimum Wage Executive Order rulemaking explained that this definition was derived from section 8 of that Executive Order, 79 FR 9853, is consistent with the convention set forth in section 1.108(d) of the FAR, 48 CFR 1.108(d), and was developed in part in response to comments on the proposed definition of new contract that appeared in the Minimum Wage Executive Order NPRM. 79 FR 60643, 60646-49. No commenter suggested altering this definition, and the Department adopts it as proposed. Additional discussion of what constitutes a new contract appears in the text addressing § 13.3 below. For purposes of the Executive Order and part 13, which use the terms in reference to domestic violence, sexual assault, or stalking, the Department proposed to define obtain additional counseling, seek relocation, seek assistance from a victim services organization, or take related legal action to mean to spend time arranging, preparing for, or executing acts related to addressing physical injuries or mental or emotional impacts resulting from being a victim of domestic violence, sexual assault, or stalking. Under the NPRM, such acts included finding and using services of a counselor or victim services organization (a term also defined in § 13.2) intended to assist a victim to respond to or prevent future incidents of domestic violence, sexual assault, or stalking; identifying and moving to a different residence to avoid being a victim of domestic violence, sexual assault, or stalking; or a victim's pursuing any related legal action (another term defined in § 13.2). The Department stated in the proposal that counseling could, but need not be, provided by a health care provider. The Department did not receive comments addressing this definition and adopts it as proposed. The Department proposed to define obtaining diagnosis, care, or preventive care from a health care provider to mean receiving services from a health care provider, whether to identify, treat, or otherwise address an existing condition or to prevent potential conditions from arising. The Department interpreted this term broadly and provided the following non-exhaustive list of examples: Obtaining a prescription for antibiotics at a health clinic, attending an appointment with a psychologist, having an annual physical or gynecological exam, or receiving a teeth cleaning from a dentist's assistant. The proposed definition further noted that it included time spent traveling to and from the location at which such services are provided or recovering from receiving such services. The Center for the Study of Social Policy commented that the Department should state explicitly that this definition includes seeking treatment for drug or substance abuse. Under the definition as proposed and adopted, any treatment for drug, alcohol, or another addiction received from a practitioner who is a health care provider as defined in § 13.2 would be included in this definition. The Department adopts the definition as proposed. The Department proposed to define the term Office of Administrative Law Judges to mean the Office of Administrative Law Judges, U.S. Department of Labor. The Department adopts this definition as proposed. Proposed § 13.2 defined the term option by adopting the definition of that term used in the Minimum Wage Executive Order rulemaking, which in turn adopted the definition set forth in section 2.101 of the FAR, 48 CFR 2.101. 79 FR 60643, 60722 (codified at 29 CFR 10.2). Under the proposal, the term option meant a unilateral right in a contract by which, for a specified time, the Federal Government may elect to purchase additional supplies or services called for by the contract, or may elect to extend the term of the contract. No commenters suggested changes to this definition, and it is adopted as proposed. The Department proposed to define paid sick leave to mean compensated absence from employment that is required by Executive Order 13706 and part 13. In the NPRM and again in this Final Rule, the Department used and uses “paid sick leave” to refer to the leave required by the Order and part 13 and “paid sick time” to refer more generally to any compensated absence from work for time used for purposes similar (although not necessarily identical) to the purposes described in the Order, including as required by State and local laws or as provided pursuant to contractors' existing policies or under CBAs. The Department received no comments regarding this definition and adopts it as proposed. Proposed § 13.2 defined the term parent to mean (1) a biological, adoptive, step, or foster parent of the employee, or a person who was a foster parent of the employee when the employee was a minor; (2) a person who is the legal guardian of the employee or was the legal guardian of the employee when the employee was a minor or required a legal guardian; (3) a person who stands in loco parentis to the employee or stood in loco parentis to the employee when the employee was a minor or required someone to stand in loco parentis; or (4) a parent, as described in paragraphs (1) through (3) of the definition, of an employee's spouse or domestic partner. This definition was adopted from the OPM regulations regarding leave for Federal employees. 5 CFR 630.102(b). EEAC urged the Department to use the definition of parent provided in the FMLA in order not to include the parent of an employee's spouse or domestic partner. Because, as noted above, the Department interprets the Order's deliberate inclusion of family members beyond those for whom an employee could take FMLA leave to indicate a general intent to allow the use of leave to care for a broad set of family members, it is adopting the definition as proposed. The Department proposed to define physical or mental illness, injury, or medical condition as any disease, sickness, disorder, or impairment of, or any trauma to, the body or mind. The Department explained in the NPRM that the Executive Order intended for this term to be understood broadly, to include any illness, injury, or medical condition, regardless of whether it requires attention from a health care provider or whether it would be a “serious health condition” that qualifies for use of leave under the FMLA. See 29 U.S.C. 2611(11); 29 CFR 825.113. In the NPRM, the Department provided the following non-exclusive list of conditions included within the proposed definition: A common cold, ear infection, upset stomach, ulcer, flu, headache, migraine, sprained ankle, broken arm, or depressive episode. The Department did not receive comments addressing this definition and adopts it as proposed. The Department proposed to define predecessor contract to mean a contract that precedes a successor contract. Because this definition was only included in the proposed rule in connection with the provision in § 13.5(b)(4) requiring reinstatement of paid sick leave by successor contractors, which for the reasons explained below does not appear in the Final Rule, the Department has removed this definition from § 13.2. The proposed rule defined procurement contract for construction as that term was defined for purposes of the Minimum Wage Executive Order Final Rule, that is, to mean a contract for the construction, alteration, or repair (including painting and decorating) of public buildings or public works and which requires or involves the employment of mechanics or laborers, and any subcontract of any tier thereunder. 79 FR 60723 (codified at 29 CFR 10.2). That proposed definition, which was derived from language found at 40 U.S.C. 3142(a) and 29 CFR 5.2(h), included any contract subject to the DBA. See 79 FR 60643. No commenter addressed this definition, and it is adopted as proposed. The Department proposed to define the term procurement contract for services to mean a contract the principal purpose of which is to furnish services in the United States through the use of service employees, and any subcontract of any tier thereunder. The proposal also stated that the term includes any contract subject to the SCA. This proposed definition was derived, as explained in the Minimum Wage Executive Order, from language set forth in 41 U.S.C. 6702(a), 29 CFR 4.1a(e), and 29 CFR 9.2. 79 FR 60643. The Department did not receive comments specifically addressing this definition. For the reasons explained in the discussion of service contract coverage below, the Department is adopting the definition as proposed. For purposes of the Executive Order and part 13, which use the terms in reference to domestic violence, sexual assault, or stalking, the Department proposed to define related legal action or related civil or criminal legal proceeding to mean any type of legal action, in any forum, that relates to domestic violence, sexual assault, or stalking, including, but not limited to, family, tribal, territorial, immigration, employment, administrative agency, housing matters, campus administrative or protection or stay-away order proceedings, and other similar matters; and criminal justice investigations, prosecutions, and post-trial matters (including sentencing, parole, and probation) that impact the victim's safety and privacy. This definition, which the Department intended to be broad and inclusive, was derived from the definition of “legal assistance” that appears in the VAWA. See 42 U.S.C. 13925(a)(19). The Department explained in the NPRM that this definition encompassed actions in any civil or criminal court, including a juvenile court. The definition also included administrative proceedings run by institutions of higher education (college, community college, university, or trade school), such as those related to alleged violations of Title IX of the Education Amendments of 1972, 20 U.S.C. 1681 et seq. The Department received no comments regarding this definition and adopts it as proposed. Under proposed § 13.2, Secretary meant the Secretary of Labor and included any official of the U.S. Department of Labor authorized to perform any of the functions of the Secretary of Labor under part 13. The Department adopts this definition as proposed. The Department proposed to define the term Service Contract Act to mean the McNamara-O'Hara Service Contract Act of 1965, as amended, 41 U.S.C. 6701 et seq., and its implementing regulations. See 29 CFR 4.1a(a). This provision is adopted as proposed. The proposed definition of sexual assault in § 13.2 was any nonconsensual sexual act proscribed by Federal, tribal, or State law, including when the victim lacks capacity to consent. This definition was adopted from the VAWA. See 42 U.S.C. 13925(a)(29). No commenter suggested revising this definition, and the Department adopts it as proposed. In the NPRM, the term solicitation was defined to have the meaning given to it in the Minimum Wage Executive Order Final Rule, i.e., any request to submit offers, bids, or quotations to the Federal Government. 79 FR 60673 (codified at 29 CFR 10.2). As explained in the Minimum Wage Executive Order rulemaking, the definition was based on language from 29 CFR 9.2, and requests for information issued by Federal agencies and informal conversations with federal workers do not fall within the definition. See 79 FR 60643-44. No comments addressed this definition, and it is adopted as proposed. The Department proposed to define the term spouse as the other person with whom an individual entered into marriage as defined or recognized under State law for purposes of marriage in the State in which the marriage was entered into or, in the case of a marriage entered into outside of any State, if the marriage is valid in the place where entered into and could have been entered into in at least one State. This definition included an individual in a common law marriage that was entered into in a State that recognizes such marriages or, if entered into outside of any State, is valid in the place where entered into and could have been entered into in at least one State. This definition was derived from the FMLA regulations. See 29 CFR 825.122 (as updated by Definition of Spouse Under the Family and Medical Leave Act, 80 FR 9989 (Feb. 25, 2015)). As the Department noted in the NPRM, marriage and common law marriage include both same-sex and opposite-sex marriages or common law marriages. The Department did not receive comments regarding this definition and adopts it as proposed. Under proposed § 13.2, stalking meant engaging in a course of conduct directed at a specific person that would cause a reasonable person to fear for his or her safety or the safety of others or suffer substantial emotional distress. This definition was adopted from the VAWA. See 42 U.S.C. 13925(a)(30). The Department did not receive comments regarding this definition and adopts it as proposed. The Department proposed to define successor contract to mean a contract for the same or similar services as were provided by a different predecessor contractor at the same location. This definition does not appear in the Final Rule because, for the reasons explained in the discussion of § 13.5(b)(4), the term is no longer relevant. In proposed § 13.2, the Department defined the term United States as it did in the Minimum Wage Executive Order rulemaking, which used the definitions of that term set forth in 29 CFR 9.2 and 48 CFR 2.101, though it did not adopt any of the exceptions to the definition of the term set forth in the FAR. See 79 FR 60645. Based on those regulations, United States meant the United States and all executive departments, independent establishments, administrative agencies, and instrumentalities of the United States, including corporations of which all or substantially all of the stock is owned by the United States, by the foregoing departments, establishments, agencies, and instrumentalities, including nonappropriated fund instrumentalities. The proposed definition further noted that when used in a geographic sense, the United States meant the 50 States and the District of Columbia. The Department did not receive comments regarding this definition and adopts it as proposed. The Department proposed to define victim services organization to mean a nonprofit, nongovernmental, or tribal organization or rape crisis center, including a State or tribal coalition, that assists or advocates for victims of domestic violence, sexual assault, or stalking, including domestic violence shelters, faith-based organizations, and other organizations, with a documented history of effective work concerning domestic violence, sexual assault, or stalking. This definition was based on the definition of “victim service provider” in the VAWA. See 42 U.S.C. 13925(a)(43). The Department intended this definition to include organizations that provide services to adult, teen, and/or child victims of domestic violence, sexual assault, or stalking. The Department did not receive comments regarding this definition and adopts it as proposed. The Department proposed to define Violence Against Women Act as the Violence Against Women Act of 1994, 42 U.S.C. 13925 et seq., and its implementing regulations. This definition is adopted as proposed. Finally, the Department proposed to define Wage and Hour Division to mean the Wage and Hour Division within the U.S. Department of Labor. This definition is adopted as proposed. Section 13.3 Coverage Proposed § 13.3 addressed and implemented the coverage provisions of section 6 of Executive Order 13706. 80 FR 54697-700. Proposed § 13.3(a) stated that part 13 applies to any new contract with the Federal Government, unless excluded by § 13.4, provided that: (1)(i) It is a procurement contract for construction covered by the DBA; (ii) it is a contract for services covered by the SCA; (iii) it is a contract for concessions, including any concessions contract excluded from coverage under the SCA by Department of Labor regulations at 29 CFR 4.133(b); or (iv) it is a contract in connection with Federal property or lands and related to offering services for Federal employees, their dependents, or the general public; and (2) the wages of employees performing on or in connection with such contract are governed by the DBA, SCA, or FLSA, including employees who qualify for an exemption from the FLSA's minimum wage and overtime provisions. As explained in more detail below in the discussion of covered employees, the Department is promulgating this provision as proposed. Proposed § 13.3(b) incorporated the monetary value thresholds referred to in section 6(e) of the Executive Order. Specifically, it provided that for contracts covered by the SCA or the DBA, part 13 applies to prime contracts only at the thresholds specified in those statutes, and for procurement contracts where employees' wages are governed by the FLSA ( i.e., procurement contracts not covered by the SCA or DBA), part 13 applies when the prime contract exceeds the micro-purchase threshold, as defined in 41 U.S.C. 1902(a). Proposed § 13.3(b) further explained that for all other covered prime contracts and for all subcontracts awarded under covered prime contracts, part 13 applies regardless of the value of the contract. In this context, “all other prime contracts” covered by the Order and part 13 referred to non-procurement concessions contracts not covered by the SCA and non-procurement contracts with the Federal Government in connection with Federal property or lands and related to offering services for Federal employees, their dependents, or the general public not covered by the SCA. The Department received one comment relevant to this provision, addressed in the discussion of “procurement contracts for construction” below, and adopts § 13.3(b) as proposed. Proposed § 13.3(c), which was identical to the analogous provision in the Minimum Wage Executive Order Final Rule, 29 CFR 10.3(c), stated that part 13 only applies to contracts with the Federal Government requiring performance in whole or in part within the United States. It further explained that if a contract with the Federal Government is to be performed in part within and in part outside the United States and is otherwise covered by the Executive Order and part 13, the requirements of the Order and part 13 would apply with respect to that part of the contract that is performed within the United States. As explained below, the Department adopts this provision as proposed. Proposed § 13.3(d), adopted from the Minimum Wage Executive Order regulations, 29 CFR 10.3(d), explained that part 13 does not apply to contracts subject to the Walsh-Healey Public Contracts Act, 41 U.S.C. 6501 et seq. The Department is adopting this provision largely as proposed, but with one modification described below in the section discussing such contracts. The preamble to the proposed rule addressed several issues related to the coverage provisions in some detail, and the Department repeats those points here, in addition to responding to comments relevant to them, in order to ensure that this Final Rule contains a full discussion of the scope of coverage under the Order. As noted in the NPRM, the Minimum Wage Executive Order Final Rule addressed many of the same issues, and much of the discussion here reflects interpretations described in that rulemaking. Coverage of Executive Agencies and Departments Executive Order 13706 applies to all “[e]xecutive departments and agencies.” 80 FR 54697. Like the Minimum Wage Executive Order, it strongly encourages but does not compel “[i]ndependent agencies” to comply with its requirements. 80 FR 54700; see also 79 FR 9853. The Department explained in the NPRM that this exemption from coverage is narrow, in light of the Executive Order's broad goal of providing paid sick leave to employees on contracts with the Federal Government. The terms executive departments and agencies (modified to include the U.S. Postal Service, as explained above) and independent agencies are defined in § 13.2. The Department received no comments regarding this interpretation. Coverage of New Contracts With the Federal Government Proposed § 13.3(a) provided that the requirements of the Executive Order apply to a “new contract with the Federal Government.” By applying only to “new contracts,” the Executive Order ensures that contracting agencies and contractors will have sufficient notice of any obligations under Executive Order 13706 and can take into account any potential impact of the Order prior to entering into “new contracts” on or after January 1, 2017. As discussed above, the proposed definition of the term contract was broadly inclusive, and the proposed definition of new contract was modeled on the definition of that term in the Minimum Wage Executive Order Final Rule, 29 CFR 10.2, and incorporated the provisions of section 7 of Executive Order 13706. Therefore, as proposed, part 13 applied to covered contracts with the Federal Government that result from solicitations issued on or after January 1, 2017, or to contracts that are awarded outside the solicitation process on or after January 1, 2017. For example, any covered contracts that are added to the GSA Schedule in response to GSA Schedule solicitations issued on or after January 1, 2017 will qualify as “new contracts” subject to the Order; any covered task orders issued pursuant to those contracts also would be deemed to be “new contracts.” This included contracts to add new covered services as well as contracts to replace expiring contracts. As explained in the discussion of § 13.2, the definition of new contract (adopted as proposed) also provides that the term includes both new contracts and replacements for expiring contracts. Consistent with the Minimum Wage Executive Order Final Rule, however, the definition does not include the unilateral exercise of a pre-negotiated option to renew an existing contract by the Federal Government. As discussed above, option means a unilateral right in a contract by which, for a specified time, the Federal Government may elect to purchase additional supplies or services called for by the contract, or may elect to extend the term of the contract. See 48 CFR 2.101. The proposed definition of new contract also provided that for purposes of the Executive Order, a contract that is entered into prior to January 1, 2017 constituted a new contract if, through bilateral negotiation, on or after January 1, 2017: (1) The contract is renewed; (2) the contract is extended, unless the extension is made pursuant to a term in the contract as of December 31, 2016 providing for a short-term limited extension; or (3) the contract is amended pursuant to a modification that is outside the scope of the contract. These statements have the same meaning in part 13 as they did in the Minimum Wage Executive Order rulemaking. See 79 FR 60646-49. The NPRM also noted the Department's understanding that contract extensions may be accomplished through options created by an agency pursuant to FAR clause 52.217-8 (which allows for an extension of time of up to 6 months for a contractor to perform services that were acquired but not provided during the contract period) or FAR clause 52.217-9 (which provides for an extension of the contract term to provide additional services for a limited term specified in the contract at previously agreed upon prices). As explained, the contracting agency's exercise of extensions under these clauses would not trigger application of the Order's paid sick leave requirements because the clauses give the contracting agency a discretionary right to unilaterally exercise the option to extend, and unilateral options are excluded from the definition of “new contract.” Specifically, and particularly in light of these clauses, a bilaterally negotiated extension of an existing contract on or after January 1, 2017 would be viewed as a “new contract” unless the extension is made pursuant to a term in the contract as of December 31, 2016 providing for a short-term limited extension, in which case the extension would not constitute a “new contract” and would not be covered. Therefore, a short-term, bilaterally negotiated extension of contract terms ( e.g., an extension of 6 months or less) that was provided for by the pre-negotiated terms of the contract prior to January 1, 2017, such as a bridge to prevent a gap in service, would not constitute a new contract. See Interim Final Rule, Federal Acquisition Regulation; Establishing a Minimum Wage for Contractors, 79 FR 74544, 74545 (Dec. 15, 2014) (providing that contracting officers “shall include” the FAR contract clause to implement the Minimum Wage Executive Order when “bilateral modifications extending the contract . . . are individually or cumulatively longer than six months”). In addition, when a contracting agency exercises its unilateral right to extend the term of an existing service contract and simply makes pricing adjustments based on increased labor costs that result from its obligation to include a current SCA wage determination pursuant to 29 CFR 4.4 but no bilateral negotiations occur (other than any necessary to determine and effectuate those pricing adjustments), the Department would not view the exercise of that option as a “new contract” covered by the Executive Order. An extension that was bilaterally negotiated and not previously authorized by the terms of the existing contract, however, would be a “new contract” subject to the Order's paid sick leave requirements. A long-term extension of an existing contract will qualify as a “new contract” subject to the Executive Order even if such an extension was provided for by a pre-negotiated term of the contract. With respect to the coverage of other contract modifications, the Department's approach is identical to that in the Minimum Wage Executive Order Final Rule. 79 FR 60646-49. It reflects that modifications within the scope of the contract do not in fact constitute new contracts. Long-standing contracting principles recognize that an existing contract, especially a larger one, will often require modifications, which may include very modest changes ( e.g., a small change to a delivery schedule). Therefore, regulations such as the FAR do not require agencies to create new contracts to support these actions. Accordingly, contract modifications that are within the scope of the contract within the meaning of the FAR, see 48 CFR 6.001(c) and related case law, are not “new contracts” under the proposed definition, even when undertaken after January 1, 2017. The Department's proposal nonetheless strongly encouraged agencies to bilaterally negotiate, as part of any in-scope modification, application of the Executive Order's paid sick leave requirements so that such modified contracts could take advantage of the benefits of such leave. As also explained in the NPRM, if the parties bilaterally negotiate a modification that is outside the scope of the contract, the agency will be required to create a new contract, triggering solicitation and/or justification requirements, and thus such a modification after January 1, 2017 will constitute a “new contract” subject to the Executive Order's paid sick leave requirements. For example, if an existing SCA-covered contract for janitorial services at a Federal office building is modified by bilateral negotiation after January 1, 2017 to also provide for security services at that building, such a modification would likely be regarded as outside the scope of the contract and thus qualify as a “new contract” subject to the Executive Order. Similarly, if an existing DBA-covered contract for construction work at Site A was modified by bilateral negotiation after January 1, 2017 to also cover construction work at Site B, such a modification would generally be viewed as outside the scope of the contract and thus trigger coverage of the Executive Order. The Department cautioned, however, that whether a modification qualifies as “within the scope” or “outside the scope” of the contract is necessarily a fact-specific determination. See, e.g., AT&T Communications, Inc. v. Wiltel, Inc., 1 F.3d 1201, 1205 (Fed. Cir. 1993). The Department did not receive comments suggesting changes to these interpretations regarding what constitutes a “new contract.” AGC asked whether new task orders under existing indefinite-delivery, indefinite-quantity (IDIQ) contracts qualify as new contracts for purposes of the Executive Order. A task order under an IDIQ contract covered by the Executive Order and part 13 would itself be covered by the Order and part 13 to the extent the task order falls within one of the four categories of contracts covered by the Order. A task order under (and within the scope of) an IDIQ contract that is not covered by the Executive Order and part 13, either because the solicitation for the IDIQ contract was issued before January 1, 2017, or the IDIQ contract was awarded outside the solicitation process before January 1, 2017, would not qualify under the Order and part 13 as a new contract even if the task order was issued after January 1, 2017. However, the Department recommended in the NPRM, and reiterates here, that the FARC should encourage, if not require, contracting officers to modify existing IDIQ contracts in accordance with FAR section 1.108(d)(3) to include the paid sick leave requirements of Executive Order 13706 and part 13, particularly if the remaining ordering period extends at least 6 months and the amount of remaining work or number of orders expected is substantial. See 79 FR 74545 (providing that contracting officers “are strongly encouraged to include” the FAR contract clause to implement the Minimum Wage Executive Order in “existing indefinite-delivery indefinite-quantity contracts, if the remaining ordering period extends at least six months and the amount of remaining work or number of orders expected is substantial”). Coverage of Types of Contractual Arrangements Proposed § 13.3(a)(1) set forth the specific types of contractual arrangements with the Federal Government that are covered by the Executive Order. Consistent with the intent of Executive Order 13706 to apply to a wide range of contracts with the Federal Government for services or construction, proposed § 13.3(a)(1) implemented the Executive Order by generally extending coverage to procurement contracts for construction covered by the DBA; service contracts covered by the SCA; concessions contracts, including any concessions contract excluded by the Department's regulations at 29 CFR 4.133(b); and contracts in connection with Federal property or lands and related to offering services for Federal employees, their dependents, or the general public. Each of these categories of contractual agreements is discussed in greater detail below. The Department notes that, as was also the case under the Minimum Wage Executive Order rulemaking, these categories are not mutually exclusive—a concessions contract might also be covered by the SCA, as might a contract in connection with Federal property or lands, for example—but a contract that falls within any one of the four categories is covered. Procurement Contracts for Construction: Section 6(d)(i)(A) of the Executive Order extends coverage to any “procurement contract for . . . construction.” 80 FR 54699. As explained in the NPRM and the Minimum Wage Executive Order rulemaking, 79 FR 60650, this language indicates that the Executive Order and part 13 apply to contracts subject to the DBA and that they do not apply to contracts subject only to the Davis-Bacon Related Acts, including those set forth at 29 CFR 5.1(a)(2)-(60). The Final Rule makes no change to this interpretation. The DBA applies, in relevant part, to contracts to which the Federal Government is a party, for the construction, alteration, or repair, including painting and decorating, of public buildings and public works of the Federal Government and which require or involve the employment of mechanics or laborers. 40 U.S.C. 3142(a). The DBA's regulatory definition of construction is expansive and includes all types of work done on a particular building or work by laborers and mechanics employed by a construction contractor or construction subcontractor. See 29 CFR 5.2(j). The DBA's implementing regulations define the term “public building or public work” as any building or work, the construction, prosecution, completion, or repair of which is carried on directly by authority of or with funds of a Federal agency to serve the interest of the general public. See 29 CFR 5.2(k). Proposed § 13.3(b) implemented section 6(e) of Executive Order 13706, 80 FR 52699-700, which provides that the Order applies only to DBA-covered prime contracts that exceed the $2,000 value threshold specified in the DBA. See 40 U.S.C. 3142(a). Under this provision, which is adopted as proposed, there is no value threshold requirement for application of Executive Order 13706 and part 13 to subcontracts awarded under such prime contracts. The Mechanical Contractors Association of America (MCAA) asked in its comment why the proposal covered subcontracts that fall below the DBA threshold amount. The Department believes coverage of subcontracts without regard to their monetary value is appropriate because it is consistent with the DBA itself, which applies the threshold only to prime contracts, 40 U.S.C. 3142(a), is consistent with the coverage provisions of the Minimum Wage Executive Order, which also do not apply threshold amounts to subcontracts, 29 CFR 10.3(b), and ensures that employees who work for lower-tier contractors on projects in which the prime contract is DBA-covered are not denied access to paid sick leave. Procurement Contracts for Services: Proposed § 13.3(a)(1)(ii) provided, in language identical to that of 29 CFR 10.3(a)(1)(ii) as promulgated by the Minimum Wage Executive Order Final Rule, 79 FR 60723, that coverage of the Executive Order and part 13 encompasses any “contract for services covered by the Service Contract Act.” That proposed provision implemented section 6(d)(i)(B) of the Executive Order, which states that the Order applies to “a contract or contract-like instrument for services covered by the Service Contract Act.” 80 FR 54699. The SCA applies (subject to the exceptions discussed below) to any contract entered into by the United States that “has as its principal purpose the furnishing of services in the United States through the use of service employees.” 41 U.S.C. 6702(a)(3); see also 29 CFR 4.110. The SCA is intended to cover a wide variety of service contracts with the Federal Government, so long as the principal purpose of the contract is to provide services using service employees. See, e.g., 29 CFR 4.130(a). SCA coverage exists regardless of the direct beneficiary of the services or the source of the funds from which the contractor is paid for the service and irrespective of whether the contractor performs the work in its own establishment, on a Government installation, or elsewhere. 29 CFR 4.133(a). The NPRM noted, however, that in addition to the provision in section 6(d)(i)(B) of the Executive Order extending coverage to contracts covered by the SCA, section 6(d)(i)(A) provides that the Order applies to “a procurement contract for services.” 80 FR 54699. In the Minimum Wage Executive Order rulemaking, the Department interpreted these two phrases together to mean that Executive Order 13658 applied to all procurement and non-procurement contracts covered by the SCA. As the NPRM to implement Executive Order 13706 explained, the phrase “a procurement contract for services” could instead be construed to encompass a category or categories of procurement contracts for services beyond those covered by the SCA. The SCA does not apply to all procurement contracts with the Federal Government for services. For example, the SCA itself contains a list of exemptions from its coverage: It does not apply to “a contract for the carriage of freight or personnel by vessel, airplane, bus, truck, express, railway line or oil or gas pipeline where published tariff rates are in effect”; “a contract for the furnishing of services by radio, telephone, telegraph, or cable companies, subject to the Communications Act of 1934”; “a contract for public utility services, including electric light and power, water, steam, and gas”; “an employment contract providing for direct services to a Federal agency by an individual”; and “a contract with the United States Postal Service, the principal purpose of which is the operation of postal contract stations.” 41 U.S.C. 6702(b); see also 29 CFR 4.115-4.122. Additionally, the SCA regulations at 29 CFR 4.123(d) and (e) identify certain categories of contracts the Department has exempted from SCA coverage pursuant to authority granted by the SCA, see 41 U.S.C. 6707(b), to the extent regulatory criteria for exclusion from coverage are satisfied. For example, 29 CFR 4.123(e)(1)(i)(A) exempts from SCA coverage certain contracts principally for the maintenance, calibration, or repair of automated data processing equipment and office information/word processing systems. Furthermore, the SCA does not apply to contracts for services to be performed exclusively by persons who are not service employees, i.e., persons who qualify as bona fide executive, administrative, or professional employees as defined in the FLSA's regulations at 29 CFR part 541. 29 CFR 4.113(a)(2); see also 41 U.S.C. 6701(a)(3)(C), 6702(a)(3); WHD Field Operations Handbook (FOH) ¶ 14c07. Similarly, a contract for services “performed essentially by bona fide executive, administrative, or professional employees, with the use of service employees being only a minor factor in contract performance,” is not covered by the SCA. 29 CFR 4.113(a)(3); FOH ¶ 14c07. In the proposed rule, the Department sought comment as to whether it should include within the coverage of Executive Order 13706 a wider set of procurement contracts for services than those contracts for services covered by the SCA. The Department's proposal noted that, for example, an interpretation treating as covered procurement contracts for services performed exclusively or essentially by employees who qualify as bona fi [Text truncated at 120,000 characters. The full text is on the page linked above.] --- Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/fr%3A2016-22964. Public record. Not legal advice.