Most importantly, any contractor that’s found to violate labor laws will be restricted from competing for certain contracts, and government agencies will have additional guidance on how to take labor violations into account in their process of awarding contacts. This will help keep taxpayer dollars out of the coffers of companies that are guilty of repeated violations that endanger the lives of workers and cheat employees out of pay.
The order represents a major step forward for increasing accountability and transparency among federal contractors, as well as protecting contracted employees by giving them more tools to fight back against workplace discrimination or harassment and ensuring that they are paid a fair wage.
Unfortunately, this will only be an improvement for workers at companies that contract with the federal government. That is why governors across the country should take similar steps on the state level to prohibit companies that have evaded taxes, broken the law, or mistreated workers from taking over public services. When state and local governments take these issues seriously workers, their families, and their communities all stand to benefit.
All too often, state and local governments are sold the false promise of outsourcing public jobs to private companies, with the expectation that businesses can do things “better, faster, and cheaper” than the government can. Unfortunately for taxpayers and workers, these promises rarely materialize, and taxpayers are too often left holding the bag while corporations make millions by cutting the quality of services and wages and benefits for workers. Even worse, in many states there is no mechanism to prevent future deals to outsource services to the same corporations that have proven that they can’t be trusted.
One particularly egregious example highlights the damage such a lack of oversight can do. Just last week, Corrections Corporation of America (CCA) was forced to pay more than $8 million in back wages and benefits to current and former employees at a California City facility after the private prison giant was found to have underpaid hundreds of employees and committed record-keeping violations under the Fair Labor Standards Act. This was hardly CCA’s first offense, but in spite of having been found to have abused and underpaid workers in several of its facilities over the last few years, they continue to operate detention centers and correctional facilities for federal, state, and local governments across the country.
At In the Public Interest, we’ve developed the Taxpayer Empowerment Agenda to help state governments avoid situations like this one, where workers are being exploited and taxpayers are not getting their money’s worth. The Agenda is built on four values: transparency, accountability, shared prosperity, and competition. It serves as a framework for taxpayers to reclaim control of government services and ensure that workers being paid with our tax dollars are treated fairly. The agenda includes a proposal to ban any company that has evaded taxes or broken the law from taking over public services. It also gives taxpayers a say in how their tax dollars are spent and allows for scrutiny of contractors’ budgets and labor practices.
Many of these proposals require legislative action, but governors should adopt the president’s “we can’t wait” attitude to act on what can be accomplished with executive action. Just as President Obama has done on the federal level, governors who implement these proposals will be standing on the side of taxpayers, workers, and plain common sense.
Donald Cohen is Executive Director of In the Public Interest, a resource center on government outsourcing, responsible contracting, and best practices for good government.