Final Rule on Nondisplacement of Service Contract Workers

The U.S. Department of Labor announced a final rule to implement the requirements of Executive Order 14055, “Nondisplacement of Qualified Workers Under Service Contracts,” which requires contractors and subcontractors performing work on covered federal service contracts to offer service employees employed under the predecessor contract the right of first refusal of employment on the successor contract.

The final rule establishes standards and procedures for implementing and enforcing Executive Order 14055. It establishes an investigation process that protects workers from displacement and is familiar to federal contractors. Stipulates how the Executive Order applies to subcontracts and identifies sanctions and remedies that may be imposed by the department under the Executive Order.

The final rule will take effect on February 12, 2024. It will apply only to solicitations issued on or after the effective date of the final regulations issued by the Federal Acquisition Regulatory Council (FAR Council). For more information, please visit Final Rule: Nondisplacement of Qualified Workers under Service Contracts (Executive Order 14055).