Federal Acquisition Regulation: Combating Trafficking in Persons-Definition of “Recruitment Fees”, 29244-29247 [2016-11056]

Agencies

• DEPARTMENT OF DEFENSE
• General Services Administration
• National Aeronautics and Space Administration

[Federal Register Volume 81, Number 91 (Wednesday, May 11, 2016)]
[Proposed Rules]
[Pages 29244-29247]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-11056]


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DEPARTMENT OF DEFENSE

GENERAL SERVICES ADMINISTRATION

NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

48 CFR Parts 22 and 52

[FAR Case 2015-017; Docket No. 2015-0017; Sequence No. 1]
RIN 9000-AN02


Federal Acquisition Regulation: Combating Trafficking in 
Persons--Definition of ``Recruitment Fees''

AGENCY: Department of Defense (DoD), General Services Administration 
(GSA), and National Aeronautics and Space Administration (NASA).

ACTION: Proposed rule.

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SUMMARY: DoD, GSA, and NASA are proposing to amend the Federal 
Acquisition Regulation (FAR) to provide a definition of ``recruitment 
fees.'' The FAR policy on combating trafficking in persons prohibits 
contractors from charging employees recruitment fees, in accordance 
with the Executive Order entitled ``Strengthening Protections Against 
Trafficking in Persons in Federal Contracts.''

DATES: Interested parties should submit written comments to the 
Regulatory Secretariat at one of the addresses shown below on or before 
July 11, 2016 to be considered in the formation of the final rule.

ADDRESSES: Submit comments in response to FAR Case 2015-017 by any of 
the following methods:
     Regulations.gov: https://www.regulations.gov. Submit 
comments via the Federal eRulemaking portal by searching for ``FAR Case 
2015-017''. Select the link ``Comment Now'' that corresponds with ``FAR 
Case 2015-017''. Follow the instructions on the screen. Please include 
your name, company name (if any), and ``FAR Case 2015-017'' on your 
attached document.
     Mail: General Services Administration, Regulatory 
Secretariat (MVCB), ATTN: Ms. Flowers, 1800 F Street NW., 2nd Floor, 
Washington, DC 20405-0001.
    Instructions: Please submit comments only and cite FAR Case 2015-
017: Combating Trafficking in Persons--Definition of ``Recruitment 
Fees'' in all correspondence related to this case. Comments received 
generally will be posted without change to https://www.regulations.gov, 
including any personal and/or business confidential information 
provided. To confirm receipt of your comment(s), please check 
www.regulations.gov, approximately two to three days after submission 
to verify posting (except allow 30 days for posting of comments 
submitted by mail).

FOR FURTHER INFORMATION CONTACT: Ms. Cecelia L. Davis, Procurement 
Analyst, at 202-219-0202 for clarification of content. For information 
pertaining to status or publication schedules, contact the Regulatory 
Secretariat Division at 202-501-4755. Please cite FAR Case 2015-017.

SUPPLEMENTARY INFORMATION:

I. Background

    DoD, GSA, and NASA are proposing to revise the FAR to add a 
definition of ``recruitment fees'' to subpart 22.17, Combating 
Trafficking in Persons, and the associated clause at 52.222-50.
    DoD, GSA, and NASA published a final rule entitled Ending 
Trafficking in Persons (FAR Case 2013-001) in the Federal Register at 
80 FR 4967, on January 29, 2015. That rule, which implemented Executive 
Order 13627 and title XVII of the National Defense Authorization Act 
for Fiscal Year 2013, became effective on March 2, 2015. As implemented 
in that rule, the policy at FAR section 22.1703(a) and in the clause at 
52.222-50(b) prohibits contractors, contractor employees, 
subcontractors, subcontractor employees, and their agents from charging 
employees recruitment fees.

II. Discussion and Analysis

A. Early Discussion and Analysis

    To provide an opportunity for early input, the Defense Acquisition

[[Page 29245]]

Regulations Council and the Civilian Agency Acquisition Council (the 
Councils) posted on January 28, 2015, at https://www.acq.osd.mil/dpap/dars/ a draft definition of ``recruitment fees,'' developed by an 
interagency group of policy experts on human trafficking. Comments were 
received from four respondents and are available for viewing at that 
Web site.
    The divergence in public input highlighted the tension between 
providing a comprehensive definition of the term to maximize worker 
protections, and of ensuring that the definition does not elicit 
unintended consequences that interfere with contractor business 
operations. As a result, while the Council has made some changes to the 
rule to reflect initial input, it has also included a number of 
questions that warrant additional input from the public (see Section 
III).
    The Councils made some revisions to the draft definition of 
``recruitment fees,'' such as--
     Addressing fees, charges, costs, assessments, or other 
financial obligations assessed against employees or potential 
employees, associated with the recruiting process, regardless of the 
manner or timing of their imposition or collection;
     Including charges for testing and training;
     Modifying language to include tips paid as a kickback; and
     Adding language interpreters or translators.
    The Councils did not modify the definition of ``employee'' because 
the rationale for this narrower definition was specifically addressed 
in the Federal Register with the publication of the second interim rule 
under FAR Case 2005-012, Implementation of Section 3(b) of the 
Trafficking Victims Reauthorization Act of 2003, published in the 
Federal Register at 72 FR 46335, 46337, and 46338, on August 17, 2007, 
and in the final rule published at 74 FR 2741, 2742, and 2743, on 
January 15, 2009.
    The Councils also note that the Department of State Exchange 
Visitor Program is not subject to the FAR and program fees charged 
under that program are not considered recruitment fees, as defined in 
this proposed rule, as was addressed in the preamble to the final rule 
under FAR Case 2013-001 published in the Federal Register at 80 FR 
4971, on January 29, 2015.

B. Issues Highlighted for Public Comments

     The early public comments, while helpful, have raised a number of 
questions for the FAR drafters as they work to promulgate a definition 
that is both effective in reinforcing the prohibition on recruitment 
fees and understandable and manageable for contractors.
    The Councils invite public comment on all aspects of the proposed 
definition. However, in particular, the Councils request comments on 
the following questions:
     Are all costs/fees associated with bringing an employee on 
board properly treated as recruitment fees?
     Are there any additional charges that should be considered 
recruitment fees?
     Should the definition of a recruitment fee vary depending 
on whether the job is a professional high-paying, high-skill job or an 
unskilled, low-paying job? Is the location of the job a factor?
     Are the boundaries (i.e., limitations) of the proposed 
definition clear? If not, what changes would make the limitations 
clearer?
     As a general matter, is the illustrative list of 
recruitment fees helpful in understanding what costs an employee may 
not be charged? If not, why not?
     What, if any, of the specifically enumerated fees in the 
proposed definition should be excluded and why?
     What, if any, of the specifically enumerated fees not 
included in the proposed definition should be added?

C. Specific Elements of the Definition

    The Councils especially welcome feedback on the following specific 
aspects of the proposed rule. For each of the following, please comment 
on whether addition of the following described language to the 
illustrative list of recruitment fee would be helpful, unhelpful, or of 
no impact, and why.
     Submitting applications, making recommendations, 
recruiting, reserving, committing, soliciting, identifying, 
considering, interviewing, referring, retaining, transferring, 
selection, or placing potential job applicants.
     Labor broker services, both one-time and recurring.
     Exit clearances, and security clearances associated with 
visas.
     Sending, transit and receiving country government-mandated 
fees, levies, and insurance.
     Pre-employment medical examinations or vaccinations in the 
sending country.
     Receiving country medical examinations.
     Transportation and subsistence costs while in transit, 
including, but not limited to, airfare or costs of other modes of 
international transportation, terminal fees, and travel taxes 
associated with travel from sending country to receiving country and 
the return journey at the end of the contract.
     Transportation and subsistence costs from the airport or 
disembarkation point to the worksite.
     Security deposits and bonds.
     The inclusion of a collateral requirement, such as land 
deeds, in contracts.
     Contract breach fees.
     An employer's recruiters, agents or attorneys, or other 
notary or legal fees.
     Insurance.
     Contributions to worker welfare funds or government 
provided benefits in sending countries required to be paid by supplier.

III. Determinations

    Determinations were made in connection with the final rule 
implementing title XVII (entitled ``Ending Trafficking in Government 
Contracting (ETGCA)'') of the National Defense Authorization Act for 
Fiscal Year 2013 to apply these statutory regulations. For an 
explanation of the Council's determinations, see the preamble published 
in the Federal Register at 80 FR 4967 and 4983-4986, on January 29, 
2015. This proposed rule just clarifies the requirements by adding a 
definition.

IV. Executive Orders 12866 and 13563

    Executive Orders (E.O.s) 12866 and 13563 direct agencies to assess 
all costs and benefits of available regulatory alternatives and, if 
regulation is necessary, to select regulatory approaches that maximize 
net benefits (including potential economic, environmental, public 
health and safety effects, distributive impacts, and equity). E.O. 
13563 emphasizes the importance of quantifying both costs and benefits, 
of reducing costs, of harmonizing rules, and of promoting flexibility. 
This is a significant regulatory action and, therefore, was subject to 
review under Section 6(b) of E.O. 12866, Regulatory Planning and 
Review, dated September 30, 1993. This proposed rule is not a major 
rule under 5 U.S.C. 804.

V. Regulatory Flexibility Act

    DoD, GSA, and NASA do not expect proposed change to have a 
significant economic impact on a substantial number of small entities 
within the meaning of the Regulatory Flexibility Act 5 U.S.C. 601, et 
seq. However, an Initial Regulatory Flexibility Analysis (IRFA) has 
been prepared and is summarized as follows:


[[Page 29246]]


    The reason for this action is to develop a standard definition 
of ``recruitment fees'' in order to clarify how the Government 
treats this prohibited practice that has been associated with labor 
trafficking, within the scope of application of the FAR.
    The objective of this rule is to clarify the types of charges 
and fees that contractors, subcontractors, and their employees or 
agents are prohibited from charging to employees or potential 
employees, under the Government policy on combating trafficking in 
persons.
    This proposed rule would apply to all entities, whether small or 
other than small, that are contractors or subcontractors on U.S. 
Government contracts. In 2014 there were about 350,000 active 
registrants in the System for Award Management (SAM). DoD, GSA, and 
NASA estimate approximately half of the registrants (175,000) are 
small entities that will receive a contract or subcontract in a 
particular year. However, there would be no actual impact from this 
rule unless the small entity was planning to charge or allow another 
entity, acting on their behalf, to charge a recruitment fee to an 
employee or potential employee. There is no data available to 
estimate this impact. Further, for the definition of ``small 
business,'' the Regulatory Flexibility Act refers to the Small 
Business Act, which in turn allows the U.S. Small Business 
Administration (SBA) Administrator to specify detailed definitions 
or standards (5 U.S.C. 601(3) and 15 U.S.C. 632(a)). The SBA 
regulations at 13 CFR 121.105(a)(1) discuss who is a small business: 
``Except for small agricultural cooperatives, a business concern 
eligible for assistance from SBA as a small business is a business 
entity organized for profit, with a place of business located in the 
United States, and which operates primarily within the United States 
or which makes a significant contribution to the U.S. economy 
through payment of taxes or use of American products, materials or 
labor.'' So, this initial regulatory flexibility analysis does not 
need to address impact on foreign small entities with Government 
contracts or subcontracts that are not small businesses as defined 
by the Small Business Act.
    There are no reporting or recordkeeping requirements associated 
with this rule.
    The rule does not duplicate, overlap, or conflict with any other 
Federal rules.
    There were no significant alternatives identified that would 
meet the objective of the rule.

    The Regulatory Secretariat Division has submitted a copy of the 
IRFA to the Chief Counsel for Advocacy of the Small Business 
Administration. A copy of the IRFA may be obtained from the Regulatory 
Secretariat Division. DoD, GSA and NASA invite comments from small 
business concerns and other interested parties on the expected impact 
of this rule on small entities.
    DoD, GSA, and NASA will also consider comments from small entities 
concerning the existing regulations in subparts affected by this 
proposed rule in accordance with 5 U.S.C. 610. Interested parties must 
submit such comments separately and should cite 5 U.S.C. 610 (FAR Case 
2015-017), in correspondence.

VI. Paperwork Reduction Act

    This proposed rule does not contain any information collection 
requirements that require the approval of the Office of Management and 
Budget under the Paperwork Reduction Act (44 U.S.C. chapter 35).

List of Subjects in 48 CFR Parts 22 and 52

    Government procurement.

    Dated: May 5, 2016.
William F. Clark,
Director, Office of Government-wide Acquisition Policy, Office of 
Acquisition Policy, Office of Government-wide Policy.

    Therefore, DoD, GSA and NASA propose amending 48 CFR parts 22 and 
52 as set forth below:

0
1. The authority citation for 48 CFR parts 22 and 52 continues to read 
as follows:

    Authority:  40 U.S.C. 121(c); 10 U.S.C. chapter 137; and 51 
U.S.C. 20113.

PART 22--APPLICATION OF LABOR LAWS TO GOVERNMENT ACQUISITIONS

0
2. Amend section 22.1702 by adding, in alphabetical order, the 
definition ``Recruitment fees'' to read as follows:


22.1702  Definitions.

* * * * *
    Recruitment fees means the following:
    (1) Recruitment fees include, but are not limited to, fees, 
charges, costs, assessments, or other financial obligations assessed 
against employees or potential employees, associated with the 
recruiting process, regardless of the manner of their imposition or 
collection--
    (i) For soliciting, identifying, considering, interviewing, 
referring, retaining, transferring, selecting, testing, training, 
providing new-hire orientation, recommending, or placing employees or 
potential employees;
    (ii) For covering the cost, in whole or in part, of advertising;
    (iii) For any activity related to obtaining permanent or temporary 
labor certification;
    (iv) For processing petitions;
    (v) For visas and any fee that facilitates an employee obtaining a 
visa such as appointment and application fees;
    (vi) For government-mandated costs such as border crossing fees;
    (vii) For procuring photographs and identity documentation, 
including any nongovernmental passport fees;
    (viii) Charged as a condition of access to the job opportunity, 
including procuring medical examinations and immunizations and 
obtaining background, reference and security clearance checks and 
examinations; additional certifications;
    (ix) For an employer's recruiters, agents or attorneys, or other 
notary or legal fees; and
    (x) For language interpreters or translators.
    (2) Any fee, charge, cost, or assessment may be a recruitment fee 
regardless of whether the payment is in property or money, deducted 
from wages, paid back in wage or benefit concessions, paid back as a 
kickback, bribe, in-kind payment, free labor, tip, or tribute, remitted 
in connection with recruitment, or collected by an employer or a third 
party, including, but not limited to--
    (i) Agents;
    (ii) Recruiters;
    (iii) Staffing firms (including private employment and placement 
firms);
    (iv) Subsidiaries/affiliates of the employer;
    (v) Any agent or employee of such entities; and
    (vi) Subcontractors at all tiers.
* * * * *
0
3. Amend section 22.1703 by--
0
a. Revising paragraph (a)(5)(i); and
0
b. Removing from paragraph (a)(6) the word ``employees'' and adding 
``employees or potential employees'' in its place.
    The revisions read as follows:


22.1703  Policy.

* * * * *
    (a) * * *
    (5)(i) Using misleading or fraudulent practices during the 
recruitment of employees or offering of employment, such as failing to 
disclose, in a format and language understood by the employee or 
potential employee, basic information or making material 
misrepresentations during the recruitment of employees regarding the 
key terms and conditions of employment, including wages and fringe 
benefits, the location of work, the living conditions, housing and 
associated costs (if employer or agent provided or arranged), any 
significant costs to be charged to the employee or potential employee, 
and, if applicable, the hazardous nature of the work;
* * * * *

PART 52--SOLICITATION PROVISIONS AND CONTRACT CLAUSES

0
4. Amend section 52.212-5 by--

[[Page 29247]]

0
a. Revising the date of the clause and paragraphs (b)(33)(i) and 
(e)(1)(xi)(A); and
0
b. In alternate II, revising the date and paragraph (e)(1)(ii)(J)(1).
    The revisions read as follows:


52.212-5   Contract Terms and Conditions Required to Implement Statutes 
or Executive Orders--Commercial Items.

* * * * *

Contract Terms and Conditions Required To Implement Statutes or 
Executive Orders--Commercial Items (DATE)

* * * * *
    (b) * * *

__(33)(i) 52.222-50, Combating Trafficking in Persons (DATE) (22 
U.S.C. chapter 78 and E.O. 13627).
* * * * *
    (e)(1) * * *
    (xi) * * *

__(A) 52.222-50, Combating Trafficking in Persons (DATE) (22 U.S.C. 
chapter 78 and E.O 13627).
* * * * *
    Alternate II (DATE). * * *
* * * * *
    (e)(1) * * *
    (ii) * * *
    (J) __(1) 52.222-50, Combating Trafficking in Persons (DATE) (22 
U.S.C. chapter 78 and E.O 13627).

* * * * *
0
5. Amend section 52.213-4 by revising the date of the clause and 
paragraphs (a)(2)(viii) and (b)(1)(viii)(A) to read as follows:


52.213-4   Terms and Conditions--Simplified Acquisitions (Other Than 
Commercial Items).

* * * * *

Terms and Conditions--Simplified Acquisitions (Other Than Commercial 
Items) (DATE)

    (a) * * *
    (2) * * *
    (viii) 52.244-6, Subcontracts for Commercial Items (DATE).
* * * * *
    (b) * * *
    (1) * * *
    (viii)(A) 52.222-50, Combating Trafficking in Persons (DATE) (22 
U.S.C. chapter 78 and E.O 13627) (Applies to all solicitations and 
contracts).

* * * * *
0
6. Amend section 52.222-50 by--
0
a. Revising the date of the clause;
0
b. Adding to paragraph (a), in alphabetical order, the definition 
``Recruitment fees'';
0
c. Revising paragraph (b)(5)(i);
0
d. Removing from paragraph (b)(6) the word ``employees'' and adding 
``employees or potential employees'' in its place; and
0
e. Removing from paragraph (h)(3)(iii) the word ``employee,'' and 
adding ``employee or potential employee,'' in its place.
    The revisions and addition read as follows:


52.222-50   Combating Trafficking in Persons.

* * * * *

Combating Trafficking in Persons (DATE)

    (a) * * *
    Recruitment fees means the following:
    (1) Recruitment fees include, but are not limited to, fees, 
charges, costs, assessments, or other financial obligations assessed 
against employees or potential employees, associated with the 
recruiting process, regardless of the manner of their imposition or 
collection--
    (i) For soliciting, identifying, considering, interviewing, 
referring, retaining, transferring, selecting, testing, training, 
providing new-hire orientation, recommending, or placing employees 
or potential employees;
    (ii) For covering the cost, in whole or in part, of advertising;
    (iii) For any activity related to obtaining permanent or 
temporary labor certification;
    (iv) For processing petitions;
    (v) For visas and any fee that facilitates an employee obtaining 
a visa such as appointment and application fees;
    (vi) For government-mandated costs such as border crossing fees;
    (vii) For procuring photographs and identity documentation, 
including any nongovernmental passport fees;
    (viii) Charged as a condition of access to the job opportunity, 
including procuring medical examinations and immunizations and 
obtaining background, reference and security clearance checks and 
examinations; additional certifications;
    (ix) For an employer's recruiters, agents or attorneys, or other 
notary or legal fees, and
    (x) For language interpreters or translators.
    (2) Any fee, charge, cost, or assessment may be a recruitment 
fee regardless of whether the payment is in property or money, 
deducted from wages, paid back in wage or benefit concessions, paid 
back as a kickback, bribe, in-kind payment, free labor, tip, or 
tribute, remitted in connection with recruitment, or collected by an 
employer or a third party, including, but not limited to--
    (i) Agents;
    (ii) Recruiters;
    (iii) Staffing firms (including private employment and placement 
firms);
    (iv) Subsidiaries/affiliates of the employer;
    (v) Any agent or employee of such entities; and
    (vi) Subcontractors at all tiers.
* * * * *
    (b) * * *
    (5)(i) Using misleading or fraudulent practices during the 
recruitment of employees or offering of employment, such as failing 
to disclose, in a format and language understood by the employee or 
potential employee, basic information or making material 
misrepresentations during the recruitment of employees regarding the 
key terms and conditions of employment, including wages and fringe 
benefits, the location of work, the living conditions, housing and 
associated costs (if employer or agent provided or arranged), any 
significant costs to be charged to the employee or potential 
employee, and, if applicable, the hazardous nature of the work;

* * * * *
0
7. Amend section 52.244-6 by revising the date of the clause and 
paragraph (c)(1)(x)(A) to read as follows:


52.244-6  Subcontracts for Commercial Items.

* * * * *

Subcontracts for Commercial Items (DATE)

* * * * *
    (c)(1) * * *
    (x)(A) 52.222-50, Combating Trafficking in Persons (DATE) (22 
U.S.C. chapter 78 and E.O. 13627).
* * * * *
[FR Doc. 2016-11056 Filed 5-10-16; 8:45 am]
 BILLING CODE 6820-EP-P