President Obama issued an Executive Order requiring contractors that have won service contracts to hire the non-managerial employees of the losing incumbent. The winning contractor is not permitted to advertise for the non-managerial positions until after the losing contractor’s employees have been given their "right of first refusal". The Order states that "[t]he federal government’s procurement interests in economy and efficiency are served when the successor contractor hires the predecessor’s employees." Although a similar Executive Order was in place during the Clinton Administration, supporters and critics of President Obama’s policy are making their voices heard.
Critics are concerned that mandating a predecessor’s employees be retained limits the winning contractor’s flexibility in achieving economy and efficiency. There are concerns also that it gives union-like protection for jobs. One of the exceptions for not hiring a predecessor’s employee is that he or she did not "perform suitably on the job." This language may be used as a sword against successor contractors by non-retained workers who want to contest the decision not to hire them. It might also require that the predecessor contractor hand over the employees’ personnel records. If non-retained workers can sue a contactor for not being hired, that alone may result in winning contractors maintaining "marginal" incumbent employees rather than hiring better skilled or motivated new employees. It may also have a chilling effect on how contractors rate their employees or document their records if there "poor references" may cause an employee not to be hired by a successor contractor.
Supporters of the requirement argue that it increases job stability, decreasing training costs. They point out also that most successor contractors already hired the predecessor’s employees anyway.
President Obama issued an Executive Order requiring contractors that have won service contracts to hire the non-managerial employees of the losing incumbent. The winning contractor is not permitted to advertise for the non-managerial positions until after the losing contractor’s employees have been given their "right of first refusal". The Order states that "[t]he federal government’s procurement interests in economy and efficiency are served when the successor contractor hires the predecessor’s employees." Although a similar Executive Order was in place during the Clinton Administration, supporters and critics of President Obama’s policy are making their voices heard.
Critics are concerned that mandating a predecessor’s employees be retained limits the winning contractor’s flexibility in achieving economy and efficiency. There are concerns also that it gives union-like protection for jobs. One of the exceptions for not hiring a predecessor’s employee is that he or she did not "perform suitably on the job." This language may be used as a sword against successor contractors by non-retained workers who want to contest the decision not to hire them. It might also require that the predecessor contractor hand over the employees’ personnel records. If non-retained workers can sue a contactor for not being hired, that alone may result in winning contractors maintaining "marginal" incumbent employees rather than hiring better skilled or motivated new employees. It may also have a chilling effect on how contractors rate their employees or document their records if there "poor references" may cause an employee not to be hired by a successor contractor.
Supporters of the requirement argue that it increases job stability, decreasing training costs. They point out also that most successor contractors already hired the predecessor’s employees anyway.