Transparency and Fairness in Civil Administrative Enforcement Actions

The President issued three executive orders recently that will have some impact on Government contractors and Government contracting in general. On Tuesday, we reported on a new Executive Order (EO) rescinding a previous EO that gave incumbent employees the right of first refusal when a successor contractor takes over on a service contract (see New Executive Order Rescinds Rules on Offering Incumbent Employees Right of First Refusal). Yesterday, we reported on one designed to ensure that agencies don't circumvent the regulatory process by issuing guidance that have the effect of law or regulation (see Improving Agency Guidance Documents). Today we intend to cover the essence of the third EO entitled "Promoting the Rule of Law Through Transparency and Fairness in Civil Administrative Enforcement and Adjudication".

What is this all about?

The rule of law requires transparency. Regulated parties must know in advance the rules by which the Federal Government will judge their actions. The Freedom of Information Act generally prohibits an agency from adversely affecting a person with a rule or policy that is not correctly promulgated - to avoid the inherently arbitrary nature of unpublished ad hoc determinations.

The EO points out that "Unfortunately, departments and agencies in the executive branch have not always complied with these requirements. In addition, some agency practices with respect to enforcement actions and adjudications undermine the APA's (The Administrative Procedure Act) goals of promoting accountability and ensuring fairness."

Under the new EO, no person should be subjected to a civil administrative enforcement action or adjudication absent prior public notice of both the enforcing agency's jurisdiction over particular conduct and the legal standards applicable to that conduct. Moreover, the Federal Government must foster greater private-sector cooperation in enforcement, promote information sharing with the private sector, and establish predictable outcomes for private conduct.

There are a number of definitions included in the EO. One that caught our attention was "unfair surprise" meaning a lack of reasonable certainty or fair warning of what a legal standard administered by an agency requires.

There are many more requirements placed upon Executive Agencies in this EO. For example, guidance documents (discussed yesterday) cannot be used to impose new standards of conduct on persons and any agency seeking to collect information from a person about the compliance of that person must ensure that such collections of information comply with the provisions of the Paperwork Reduction Act.

The full EO can be accessed here.