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  1. By Edward W. Bailey, Soon after the end of fiscal year 2019, the Department of Labor (“DOL”) reported that its Wage and Hour Division (“WHD”) had made record breaking recoveries against employers. In its year-end report, the DOL revealed that it collected a remarkable $322 million in back-wages owed to workers. WHD’s new administrator, Cheryl Stanton, stated the following in response to the news: We are delivering more back wages for workers than ever before, and we are steadfastly eliminating any unfair economic advantage employers may try to gain by skirting the rules. We are protecting those who do the right thing, pay their employees what they have legally earned, and operate in compliance. True to Ms. Stanton’s comment, the DOL’s report did not only tout its enforcement but also the guidance the agency provides to employers to help them stay in compliance. For example, in its report, the DOL noted that it hosted over 3,700 educational events for employers in fiscal year 2019 and mentioned the educational resources it provides employers via its website. These lectures and guidance materials provided by the DOL can be a great way to keep up with employer’s ever-evolving wage and hour obligations. This is particularly highlighted by recent changes to certain critical exemptions from the Fair Labor Standard Act’s (“FLSA”) overtime requirements. For example, as of January 1, 2020, the salary threshold that most salaried employees must earn to be exempt from overtime increased, for the first time since 2004, to $35,568 from $23,660. Likewise, the threshold for “highly compensated employees” rose from $100,000 to $107,000. However, while government resources can provide basic guidance on what the state of the law is, the best thing employers can do to protect themselves from the DOL’s ever-increasing enforcement activity is to conduct a self-audit. Key items to include in any such audit are: Verifying whether your workers are independent contractors or employees by closely examining how much control you have over their day-to-day tasks, where they are performing their work, and whether they are responsible for providing their own work-materials Reviewing time-keeping systems and procedures to ensure that non-exempt employees are being properly compensated. For example, a common pitfall is to automatically withhold compensation to employees for scheduled meals and breaks without confirming that that those breaks were actually taken Closely examining the roles of employees who you have found to be exempt by reviewing their job descriptions to ensure that it actually reflects the work the employee is performing. Likewise, as discussed above, ensure that the relevant salary amounts are met before exempting an employee. Finally, whenever possible, an audit should be overseen by either in-house or outside counsel in order to protect the audit’s findings under attorney-client privilege. Should you have any concerns regarding your organization’s wage and hour obligations, be sure to contact us at http://centrelawgroup.com/contact/. About the Author: Edward W. Bailey Associate Attorney Ed Bailey is an associate attorney whose practice focuses on government contracts law, employment law, and litigation. Ed recently graduated cum laude from George Mason University’s Antonin Scalia Law School where he was a member of the Law Review. The post DOL Breaks Records in Wage & Hour Enforcement: How Employers Can Protect Themselves in 2020 appeared first on Centre Law & Consulting. View the full article
  2. By Heather Mims, Esq. The Government Accountability Office (“GAO”) published a report on November 25, 2019 which recommended that the Department of Defense (“DOD”) should include an assessment of risks related to contractor ownership as part of its ongoing efforts to conduct fraud risk assessments. See Ongoing DOD Fraud Risk Assessment Efforts Should Include Contractor Ownership. In coming to this recommendation, the GAO reviewed thirty-two adjudicated cases between 2012 and 2018, including cases where contractors created the appearance of competition by operating through multiple companies owned by the same entity, contractors received contracts they were not eligible to receive, and, perhaps most egregiously, a foreign manufacturer received sensitive information and produced faulty equipment through a U.S.-based company. In one case, a contractor (which should have been deemed ineligible to contract with DOD) illegally exported sensitive military data and provided defective and nonconforming parts that led to the grounding of 47 fighter aircraft. These thirty-two contractors used shell companies to help obscure their overseas ties and the fact that some were making U.S. military equipment abroad, where military technical drawings can leak out. This problem could well be more widespread than the GAO Report lets on – the GAO Report was not intended to measure or estimate the scope of DOD contractors with opaque ownership. Indeed, DOD generally accounts for about two-thirds of federal contracting activity, awarding over $350 billion in contracts, with over 570,000 new contracts, to approximately 38,000 companies. DOD’s extensive contracting demonstrates the need for it to address contractor ownership issues. DOD isn’t the only agency in hot water. Another recent GAO Report, Agencies and OMB Need to Continue Implementing Recommendations on Acquisitions, Operations, and Cybersecurity, found that since 2010, agencies have only implemented 61% of the GAO’s 1,320 recommendations on IT acquisitions and operations and 76% of the 3,323 recommendations on cybersecurity. However, the GAO gave itself a pat on the back in its Performance and Accountability Report Fiscal Year 2019, in which it noted that the GAO saved a “record” $214.7 billion for taxpayers in fiscal year 2019 by preventing payment errors, improving the efficiency and effectiveness of federal programs, and preventing fraud. About the Author: Heather Mims Associate Attorney Heather Mims is an associate attorney at Centre Law & Consulting. Her practice is primarily focused on government contracts law, employment law, and litigation. Heather graduated magna cum laude from the George Mason School of Law where she was the Senior Research Editor for the Law Review and a Writing Fellow. The post GAO Finds That DOD Faced Fraud and National Security Risks From Contracting in 2019 appeared first on Centre Law & Consulting. View the full article
  3. By David Warner, Last month, the U.S. Court of Federal Claims issued a decision underscoring the substantial risk contractors incur if they perform work not properly authorized by the appropriate government authority. The decision in Panther Brands, LLC v. United States, No. 16-1157C (Dec. 17, 2019) serves as a stark reminder that, even in the face of contrary past customer practice and verbal assurances by seemingly appropriate personnel, typically only Contracting Officers have the authority to contractually bind the government. And if you work without a valid contract in place, you very well might not get paid for your efforts. The back story of Panther Brands is a familiar one of an ongoing business relationship that ends unexpectedly (at least per the contractor’s perspective) and the subsequent dispute over work performed but not yet paid. The facts of the matter were largely undisputed. Beginning in 2008, the Army National Guard annually sponsored Panther racing teams in the IndyCar Series to advertise and market itself. In 2012, Panther entered into a new sponsorship agreement for the Guard – via an intermediary prime contractor LM&O – that would extend through the last race of the 2013 season with a one-year extension the could be exercised in writing on or before July 31, 2013. The agreement paid Panther $12.8 million in the first year and at least another $12.8 million if the extension was exercised. It was not disputed that, since their first work on behalf of the Guard in 2008, Panther would routinely begin its preparation for the next racing season before a written sponsorship agreement was in place. There was also evidence that the Guard was aware that it was the custom and practice for Panther to be orally authorized to proceed with its preparations based upon a verbal confirmation of the Guard’s exercise of a renewal option. Even the CO herself testified (in words that will chill the hearts of government contracts lawyers everywhere) that the Guard would often “make relations with vendors and let the contracting process catch up when it could.” Alas, as Panther was to learn, sometimes the contracting process does not “catch up.” Consistent with the CO’s testimony and past practice, Panther received multiple, verbal indications that the second contract year – i.e. for the 2014 racing season – was authorized. These included statements from the Contracting Officer’s Representative (COR), who testified that he specifically informed Panther in February 2013 that the “IndyCar contract … was being renewed for 2014, and that [Panther] should start preparing for the 2014 season.” Notwithstanding these communications, Panther did not sign any extension of the IndyCar sponsorship agreement, let alone do so prior to July 31 as their existing contract required. Later in 2013 and notwithstanding the earlier statements to Panther, the Guard began exploring the possibility of sponsoring a different racing team for the 2014 season. It ultimately did so, selecting Rahal Letterman Lanigan Racing (RLL); and the award to RLL survived Panther’s bid protest effort to hold on to its sponsorship work on behalf of the Guard. Following its failed protest effort, Panther sought to recover approximately $5,000,000 for the work it had performed in anticipation of supporting the Guard during the 2014 season. In the absence of an actual contract for the work (i.e., with no extension having been signed). the company asserted theories of implied-in-fact contract, estoppel and ratification via the government’s silence given its knowledge of Panther’s activities in support of 2014. None prevailed, and Panther was left holding a seven-figure bag of unrecoverable costs. Panther’s implied-in-fact argument foundered on the fact that there was no evidence that the individuals who purportedly authorized their 2014 related work actually had the authority to do so. This was particularly so with regard to the COR, who the Court noted was not “authorized to award, agree to, or sign any contract or modification thereto, or in any way obligate the payment of money by the Government.” Panther’s ratification and estoppel theories similarly failed because of a lack of evidence that the CO – i.e., the only official actually capable of authorizing the company’s work – had knowledge of the COR’s statement or that she acquiesced or agreed with his authorization for Panther to begin work in support of 2014. This was so, even though the CO testified that she was aware of and had acquiesced to previous, similar verbal authorizations when the Guard contracted directly with Panther and not through the intermediary prime contractor LM&O. The old saw that “the customer is always right” might remain generally applicable, even in the federal contracting context. But as Panther Brands makes clear, contractors need to have an exact understanding of who can speak for – and more importantly bind – their government customer. Failing to do so can result in expensive lessons in the vagaries of contract formation. About the Author: David Warner Partner David Warner is a seasoned legal counselor with extensive experience in the resolution and litigation of complex employment and business disputes. His practice is focused on the government contractor, nonprofit, and hospitality industries. David leads Centre’s audit, investigation, and litigation practices. The post “Cold Take” Alert: There’s A Reason It’s Called “Working At Risk” appeared first on Centre Law & Consulting. View the full article
  4. By JW Butler On October 1, 2019 The General Services Administration (GSA) released the new Multiple Award Schedule (MAS) 47QSMD20R0001. GSA has tentatively scheduled the first mass modification refresh for the MAS Solicitation 47QSMD20R0001 for January 2020. The MAS will be updated to incorporate the below changes in Refresh #1: Implement the 2nd Interim Rule 2018-017 Prohibition on Contracting for Certain Telecommunications and Video Surveillance Services or Equipment The FAR 51 Deviation Authority will be removed The current contract clauses/provisions will be updated The legacy Schedule SINs will be remapped to the new MAS SINs How Does the Mass Mod Affect Me? Current Schedule Holders All terms and conditions of current Schedules will be updated to the new MAS. All currently awarded SINs will be migrated to their new SIN numbers. Contactors should review the “Available Offerings Attachment” here and familiarize themselves with the new SIN structure and how it affects their current SINs. Contract numbers will not be changing with the acceptance of this mass modification. If you have an option renewal modification that is completed, signed, and are ONLY waiting for the date of the extension, to ensure there is no disruption to your option renewal, the mass modification should be signed after the date of the new option. If you have not yet completed your option modification, the mass modification can be accepted before the extension date. The option to add/delete SIN modification will temporarily be removed from the eMod System when the mass modification is released. This is being done to ensure all modifications can be completed and accepted before the mass modification is accepted. The add/delete SIN option will be back in the eMod system in March 2020. If you have hold multiple Schedule contracts, you must sign the mass modification FOR EACH contract. Vendors with Currently Pending Offers If you currently have an offer under the new MAS solicitation pending with GSA it is recommended that you reach out to your assigned contracting specialist/contracting officer to accept the MAS Refresh #1 prior to the award of your contract. Vendors Preparing to Submit a New Offer in GSA eOffer The new MAS will remain open with no closing date in the same way the 24 Legacy Schedules did. The consolidation of the Schedules should not impact the length of time it takes a contractor to obtain a GSA Schedule. Vendors should review the new requirements under “SCP-FSS-001 Applicable to All Offerors” before submitting a new Offer to ensure they are following all guidelines of the Solicitation. The Solicitation for the new MAS can be found here. If you have any questions on the MAS Consolidated Mass Mod, please contact our GSA Consulting team. About the Author: JW Butler Consultant JW Butler is GSA/VA Contract Consultant at Centre Law & Consulting. JW supports the consulting team in preparing various contract modifications, market analysis for products/services, and GSA Advantage catalog updates for Schedule contracts. JW also assists in the preparation of both new Schedule and successful legacy proposals, as well as uses the Schedule Input Program (SIP) to upload catalogs to GSA eLibrary and GSA Advantage. The post GSA Multiple Award Schedule Mass Modification Impacting Pending and Current Schedule Holders – January 2020 appeared first on Centre Law & Consulting. View the full article
  5. By Hon. Jack Delman Background On November 22, 2019, the DOD, GSA and NASA jointly issued a final FAR rule, effective December 23, 2019, amending the FAR to require contractors and subcontractors to report to the “Government – Industry Data Exchange Program” (GIDEP) certain counterfeit or suspected counterfeit parts as well as certain major or critical nonconformances. This final rule implemented–and broadened — the requirements of sections 818(c)4 and (c)5 of the FY 2012 NDAA that required DOD contractors to report counterfeit or suspect counterfeit electronic parts to the GIDEP. The Need Counterfeit items are not produced to meet the higher-level quality standards required in mission critical applications and may cause failures to systems vital to our national defense and to an agency’s mission. By reporting to GIDEP, contractors will be able to share knowledge of counterfeit items and of critical and major nonconformances which will reduce the risk of such items entering the supply chain. The Coverage Generally, the new FAR rule applies to the following: (1) contracts and subcontracts of all agencies that acquire items that are subject to higher-level quality standards per FAR 52.246-11; (2) other items that the CO determines to be “critical items”; and (3) electronic parts or items containing electronic parts acquired for the DOD. The new rule does not apply to the acquisition of commercial items, including COTS items; DOD contracts and subcontracts below the simplified acquisition threshold; and to medical devices that are subject to FDA reporting requirements. The rule also exempts a contractor that is a foreign entity that does not have an office, place of business or fiscal paying agent in the U.S. The New FAR Clause The following is a brief overview of the new FAR clause, “FAR 52.246-26 Reporting Nonconforming Items (Dec 2019).” Subsection (a) provides pertinent Definitions (i.e., counterfeit item, critical item, critical nonconformance, major nonconformance, suspect counterfeit item). Subsection (b) lists the contractor’s obligations under the clause: To screen and to submit GIDEP reports; to provide written notification to the CO of counterfeit or suspect counterfeit items; and to retain the items pending disposition instructions from the CO. Subsection (c) lists the exceptions to the reporting requirement. Subsection (d) precludes the disclosure of information in violation of the Trade Secrets Act or otherwise prohibited by law. Subsection (e) provides additional guidance on the use of the GIDEP. Subsection (f) provides that a DOD contractor (only!) shall not be subject to civil liability based on its reporting, provided that the contractor made a reasonable effort to determine that the report was factual (the “safe harbor” provision). Subsection (g) provides flowdown requirements for subcontracts. For the complete contract clause and all related FAR amendments, see 84 Federal Register 64680. How Will It Work? New FAR clauses inevitably raise confusion, uncertainty and legal questions, and this one will raise more than its share. Will a contractor’s failure to submit a GIDEP report and to provide CO notification be a material violation of the contract to support a default termination? Will the submissions of nondefense contractors protect them from civil liability in a manner similar to the “safe harbor” provision for defense contractors? Will the costs of reporting outweigh the benefits, and will these costs be particularly burdensome on small business? Stay tuned! About the Author: Hon. Jack Delman Retired Judge Jack Delman served as a judge on the Armed Services Board of Contract Appeals for 29 years and has extensive experience in the adjudication and mediation of large and complex contract disputes, including equitable adjustments, terminations and cost and pricing issues. Jack has extensive experience with claims analysis, FAR and DOD agency regulations and BCA practice and procedure. The post FAR “Fake” News! FAR Amended to Require Reporting of Counterfeit Items appeared first on Centre Law & Consulting. View the full article
  6. By Tyler Freiberger, Esq., The Department of Justice recently announced the new Procurement Collusion Strike Force (“PCSF”), an inter-agency partnership that includes prosecutors from DOJ’s Antitrust Division and 13 U.S. attorneys’ offices, FBI investigators, and several agency Inspectors General offices. The stated goal of this partnership is “deterring, detecting, investigating and prosecuting antitrust crimes” in the government contracting world. The new PCSF website also streamlines and clarifies the process for agency whistleblowers. The announcement comes just a year after DOJ recovered $230 million from an anti-trust investigation of South Korean companies providing fuel to American military bases in South Korea. This was by far the largest civil recovery under Section 4A of the Clayton Act, the tool that allows the government to recover civil penalties from contractors engaged in anti-competitive practices. Innocent contractors have little reason to sound the alarm though. Anti-trust violations in the government procurement world are particularly rare. Of course, many contractors don’t trust their competitors enough to collude with them. In fact, since 1990, only five civil anti-trust cases have been brought against government contractors. The PCSF’s red flags, listed here, reflect how odd it would be to collude with a competitor by warning agencies what to look for if “the document properties of two or more electronic proposals show that the proposals were created or edited by one vendor.” Not all the PCSF’s warning signs are so obvious though. In some fields knowledge of a competitor’s prices can easily be deduced without wrongdoing. Even if you have done nothing wrong to obtain that information, to avoid unnecessary scrutiny, refrain from violating one of the listed red flags such as making “statements on the phone or by e-mail indicating advance knowledge of a competitor’s prices.” About the Author: Tyler Freiberger Associate Attorney Tyler Freiberger is an associate attorney at Centre Law & Consulting primarily focusing on employment law and litigation. He has successfully litigated employment issues before the EEOC, MSPB, local counties’ human rights commissions, the United States D.C. District Court, Maryland District Court, and the Eastern District of Virginia. The post New DOJ Strike Force Aimed at Contractors is Likely Overhyped appeared first on Centre Law & Consulting. View the full article
  7. By Julia Coon, The General Services Administration (GSA) completed Phase 1 of the Multiple Award Schedule (MAS) consolidation on October 1, 2019 when the new MAS solicitation consolidating the twenty-four legacy Schedules into one single solicitation was published. Phase 2 of the MAS consolidation will begin in January 2020 when GSA issues a mass modification to all existing contract holders. The mass modification will update all terms and conditions to match the new MAS solicitation. Once the mass modification has been accepted, contract holders will be able to add Special Item Numbers (SINs) that were previously on separate Schedules. Contract holders must qualify for the SIN(s) and submit a modification to add any new SIN(s) in eMod. SIN specific qualifications can be found in the MAS solicitation on beta.sam.gov. How to Prepare for the Mass Modification: Ensure your Contract Administrator’s information is up to date so you will receive the mass modification. Review the new solicitation to understand where your current offerings will fall under the new large categories, subcategories, and SINs. GSA has provided a crosswalk of the legacy SINs to the new SINs in the Available Offerings Attachment. Attend either the Session One webinar or Session Two webinar that GSA is hosting. What to Do When You Receive the Mass Modification: Review the mass modification in its entirety. Either accept the clause or request an exception to the clause when responding to the mass modification. A written justification for each requested clause exception must be included and negotiated with your Contracting Officer. NOTE: You can review your current clause exceptions in eLibrary. You do not have to take exception to any clauses that do not apply to your contract. Contract holders with clause exceptions should reach out to their Contracting Officer before April 1, 2020 to ensure there is adequate time to negotiate the exceptions. Respond to the mass modification before the July 31, 2020 deadline. Your assigned Contracting Officer, contract number, period of performance, and product/service offerings will not change after acceptance of the mass modification. Multiple contract consolidation will be completed in Phase 3. If you do not respond to the mass modification by the deadline, your contract offerings will not be available to view on GSA’s eTools. If you have any questions on the MAS consolidation, please contact our GSA team at at info@centrelawgroup.com or call us at 703-288-2800. About the Author: Julia Coon Consultant Julia Coon is GSA and VA Contract Consultant at Centre Law & Consulting. Julia works with the GSA/VA team in preparing new schedule proposals and post-award contract administration. She has experience in producing schedule renewal packages, various modification packages, small business subcontracting plans, and updates to GSA price lists. The post Phase 2 – Multiple Award Schedules (MAS) Consolidation appeared first on Centre Law & Consulting. View the full article
  8. By William Weisberg, Esq., So, I was asking myself, what about government contracts drives me up a wall? More particularly, what is most frustrating to me, as a practicing procurement lawyer? Easy: debriefings. We (at least contractor “we”) have participated in debriefings where the government “script” was some variation on: “Your proposal was terrible. Here is [insert the absolute minimum to fill up a page or five minutes of phone time, no matter the size or complexity of the procurement]. You were lucky we didn’t laugh you out of the competitive range.” Or, a debriefing where the time spent on ground rules, and what won’t be discussed, is longer (often much longer) than the substance. I get it. I know why (even though no one says it out loud) the Government does it that way: to avoid “giving” protest grounds to the contractor. There is a pervasive feeling that if the contractor gets a comprehensive, candid debriefing (still within the FAR part 15 confines on what can be disclosed), then the contractor will magically have grounds of protest, and will use them at GAO. Whereas, if the government keeps it short and shorter, there won’t be a protest. The frustrating part, to me, is that this is almost 180 degrees wrong. It is wrong because: I (as a protest lawyer for my client) don’t need detailed proof of the agency getting it wrong to file at GAO. I only need a good faith belief by the contractor that the government violated a statute, a regulation, the terms of the solicitation, or acted unreasonably (“We can’t have been scored [fill in the blank] on [fill in the other blank] because we [fill in the blank] on the [fill in the blank—i.e. task, or contract, or proposal section, or other contract], and that the contractor was prejudiced (“but for the government’s action or inaction, we would have….”). Congress and GAO intentionally set this as a low bar. Higher than “we lost, therefore the government was wrong,” but not proof (at this stage). Proof comes later. More protests are filed out of a contractor not knowing. A bare bones debriefing is much more likely to cause the contractor to say “…they really didn’t understand our technical proposal…,” or something similar, and generate a protest to find out. (DOD is going in the right direction with their Enhanced Debriefings, but even they have room to improve.) And everything the government thinks they are keeping from the contractor by keeping the debriefing sparse will be made available to me, their outside counsel, under a GAO Protective Order during the protest, with plenty of time and opportunity to use that material in our later protest filings. Whenever I have the chance to speak with my government counterparts (or have the contractor speak with their counterparts) before the debriefing starts, I try to communicate this message: “Be as candid and complete with us as you can. I am certainly not committing that we won’t protest even if the debriefing is detailed, but I can tell you that we are more likely to protest after a sparse debriefing, because the contractor is more likely to believe you messed up, rather than we messed up. And if we do protest, I will see everything in your files anyway, so there is no tactical advantage to keeping things thin.” Sometimes they listen, sometimes they don’t. For any questions please do not hesitate to contact us at info@centrelawgroup.com or call us at 703-288-2800. About the Author: William Weisberg, Esq Of Counsel William Weisberg is a government contracts attorney with 30 years of experience. Bill received his undergraduate degree from the University of Virginia (where he was an Echols Scholar) in 1983 and his law degree from the George Washington University in 1986. Bill practiced with large international law firms for over 25 years, the last 10 of which he led his firms’ Government Contract and Grant practice groups. Bill formed his own boutique government contract firm in 2013. The post Debriefings: A Modest Proposal appeared first on Centre Law & Consulting. View the full article
  9. By Angel N. Davis, With Cybersecurity awareness a keen focal point, regardless of business size, Government Contractors now have an overwhelming responsibility to ensure the safeguarding of sensitive customer data. The latest Department of Defense (DOD) regulation being developed to support the growing number of cybersecurity concerns , is the DOD Cybersecurity Maturity Model Certification. The DOD issued a new draft of the CMMC Model, version, 0.6 on November 7, 2019. According to DOD, the CMMC will be a unified cybersecurity standard for DOD acquisitions, to reduce exfiltration of Controlled Unclassified Information (CUI) from the Defense Industrial Base (DIB). The CMMC audit will be conducted by certified Independent, 3rd parties. The overall objective of the Cybersecurity Maturity Model Certification is to combine a variety of cybersecurity standards and best practices, map these practices and processes across several maturity levels and when implemented will hopefully reduce and help manage risk, against cyber threats. The applicable CMMC level, will be specified in the solicitation. CMMC, revision 1.0 will be implemented in January 2020. CMMC requirements will be included in Requests for Information in June 2020 and will be included in Request for Proposals starting in Fall 2020. As the Department of Defense works to refine the model, stakeholder feedback has been requested. For additional information, regarding the implementation of CMMC, please click on the following Link: https://www.acq.osd.mil/cmmc/faq.html As the new year approaches, Centre Law & Consulting, will continue to keep you updated on the latest regulations. If you have questions regarding the CMMC, please contact us at info@centrelawgroup.com or call us at 703-288-2800. About the Author: Angel Davis, CFCM Contracts Manager Angel N. Davis has over 13 years of experience in federal contracts management. She is a Certified Federal Contracts Manager (CFCM) and is currently the President of the Tysons Chapter of the National Contract Management Association (NCMA). While completing the NCMA Contract Management Leadership Development Program (CMLDP), Angel successfully pioneered the NCMA Tysons Women In Leadership Initiative. The post The DOD Cybersecurity Maturity Model Certification: Is Your Organization Prepared? appeared first on Centre Law & Consulting. View the full article
  10. By Heather Mims, Esq. Under Executive Order 13495, the policy of the Federal Government was that all Service Contract Act covered contracts over the simplified acquisition threshold were to include a contract clause requiring contractors to make good-faith offers of employment to predecessor SCA-covered employees. However, on October 31, 2019, President Trump issued an “Executive Order on Improving Federal Contractor Operations by Revoking Executive Order 13495” which requires the “Secretary of Labor (Secretary), the Federal Acquisition Regulatory Council, and heads of executive departments and agencies . . . , consistent with law, [to] promptly move to rescind any orders, rules, regulations, guidelines, programs, or policies implementing or enforcing Executive Order 13495.” While the Department of Labor’s guidance with respect to Executive Order 13495 appears to have been removed from its website, it will likely be some time before the effects of President Trump’s actions are fully realized. For example, FAR § 52.222-17 – Nondisplacement of Qualified Workers will need to be formally rescinded – and will remain in the Federal Acquisition Regulations until that time. Therefore, during this transition period, contractors should carefully review all new solicitations and contracts to ensure that the agency has not included Executive Order 13495 or its implementing FAR regulations and, if an agency has included those in a newly issued solicitation, the contractor should take exception to those requirements. About the Author: Heather Mims Associate Attorney Heather Mims is an associate attorney at Centre Law & Consulting. Her practice is primarily focused on government contracts law, employment law, and litigation. Heather graduated magna cum laude from the George Mason School of Law where she was the Senior Research Editor for the Law Review and a Writing Fellow. The post President Trump Revokes Executive Order Providing for Nondisplacement of Qualified Workers appeared first on Centre Law & Consulting. View the full article
  11. By David Warner, Actually “40,569,816 reasons,” to be exact. Last week the Office of Federal Contract Compliance Programs (OFCCP) issued a press release lauding its performance in fiscal year 2019 in which it obtained a record-setting $40,569,816 in monetary settlements from federal contractors. The results reflect a more than sixty-five percent (65%) increase over the agency’s prior record that was set in FY 2017. Indeed, the agency’s three-year total recovery between FY 2017-2019 is greater than the total amount recovered in the seven-year period between FY2010 and 2016. OFCCP enforces Executive Order 11246, Section 503 of the Rehabilitation Act of 1973 and the Vietnam Era Veterans’ Readjustment Assistance Act of 1974. These authorities preclude federal contractors and subcontractors from discriminating in employment because of race, color, religion, sex, sexual orientation, gender identity, national origin, disability, or veteran status. They also require federal contractors to take affirmative steps to ensure equal employment opportunity in their employment processes. Contractors also are prohibited from discriminating against applicants or employees because they inquire about, discuss, or disclose their compensation or that of others, subject to certain limitations. Unlike its EEOC counterpart, the OFCCP has broad proactive audit authority. In March of this year, the agency issued its Corporate Scheduling Announcement List identifying 3,500 worksites for potential compliance audit. By way of comparison, during the first three quarters of FY 2019, the agency only conducted seventy (70) complaint investigations. (See “Complaint Investigation Outcomes” link). So why the massive uptick in money recovered? Per the OFCCP itself, the agency credits its implementation of the “Early Resolution Procedures” (ERP) program in FY 2019, which led to a number of corporate-wide settlements early in the review process. The ERP is designed to help contractors and OFCCP achieve the mutual goal of equal employment opportunity in federal contracting and reduce the length of compliance evaluations. Importantly, ERP acknowledges that many multi-establishment contractors have centralized human resource systems and corporate-wide policies and that issues OFCCP finds at one contractor establishment may exist at others. In other words, for larger contractors with multiple worksites, audits are now far more likely to cascade beyond their initial scope and seek to redress systemic issues on a company-wide basis. About the Author: David Warner Partner David Warner is a seasoned legal counselor with extensive experience in the resolution and litigation of complex employment and business disputes. His practice is focused on the government contractor, nonprofit, and hospitality industries. David leads Centre’s audit, investigation, and litigation practices. The post Forty Million More Reasons To Care About Workplace Equity appeared first on Centre Law & Consulting. View the full article
  12. By Edward W. Bailey, All too often, federal contractors let their guard down when it comes to their ethical duties under the Federal Acquisition Regulations (FAR). This is largely because the FAR’s provisions concerning ethical conduct do not provide much specific guidance. For example, FAR § 52.203-13 requires contractors to have a “written code of ethics”, exercise “due diligence to prevent and detect criminal conduct”, and otherwise “promote and encourage” ethical conduct and compliance with the law. Since violations of your ethical responsibilities can result in suspension, debarment, fines, and even imprisonment, such broad language does not exactly inspire confidence that the regulations will be applied in a consistent and understandable fashion. Not to worry though. While the regulations themselves are broad, adhering to the following three principles will greatly help to reassure the government that your organization is compliant: (1) approach your ethical obligations systematically; (2) create and maintain records; and, most importantly, (3) stay vigilant. Taking a systematic approach to ethical compliance means creating specific internal processes for preventing and responding to suspicious conduct and designating specific management personnel with clearly defined roles. In that regard, you should task a specific individual in management with handling reports of unethical behavior, ensure your employees know who this person is, and specify how such reports are to be moved up the chain of command. Such clearly defined roles and processes are critical because a key aspect of a contractor’s ethical obligations under the FAR is to “timely” report violations to the government. You should create and maintain records of all actions taken to further ethical compliance. This is because, as far as any potential government investigator is concerned, steps taken to comply with your ethical obligations carry little weight unless there is a record of them for the investigator to review. For example, if your organization has a meeting or hosts a lecture regarding ethical compliance, designate someone to take the minutes and record who is present. Moreover, when it comes to distributing your code of ethics, make sure to obtain written acknowledgements from all your organization’s employees to verify that they have read and understand its content. Finally, and most importantly, stay vigilant! Many contractors believe that once they’ve created a code of ethics, distributed it, and hosted a training session or two, their ethical responsibilities have been met. Unfortunately, as stated above, the task of ethical compliance under the FAR is never over and the more vigilance your organization demonstrates, the less likely the government is to investigate. Therefore, always continue to draft guidance materials and schedule periodic training and information sessions to make sure your employees stay informed regarding their ethical obligations and are on top of current practices and trends. Moreover, establish recurring meetings among management to verify company business practices, procedures, and internal controls for compliance. Should you have any concerns regarding your organization’s ethical obligations under the Federal Acquisition Regulations, be sure to contact us at http://centrelawgroup.com/contact/. About the Author: Edward W. Bailey Associate Attorney Ed Bailey is an associate attorney whose practice focuses on government contracts law, employment law, and litigation. Ed recently graduated cum laude from George Mason University’s Antonin Scalia Law School where he was a member of the Law Review. The post Staying Vigilant – Why the Task of Ethical Compliance Under the FAR is Never Complete appeared first on Centre Law & Consulting. View the full article
  13. By Maureen Jamieson Call me a skeptic. I had my bets along with others that the Consolidated Schedule would not be released on October 1, 2019. I’ve lived through many disappointments over my years working on Multiple Award Schedules (MAS). I remember the promises of no more Schedules Input Program (SIP) and the advent of the Formatted Price List. Then a few years ago the release of the Formatted Product Tool (FPT) only to be told that tool was being discontinued by the General Services Administration (GSA). Any of you who have worked with SIP or tried, you will understand the excitement when we blogged that SIP was going away. Then there are other disappointments, such as the promises of faster processing of modifications, which can still take months. But now a shout out to Stephanie Shutt, the Director of the Multiple Award Schedule Program, who defied the odds and not only released the Consolidated Schedule on time but did an amazing job keeping industry updated and involved in the process. Because everyone in the MAS world has been busy making sales against their individual Schedules, we are still getting questions on the impact of the Consolidated Schedule to individual Schedule holders. Following is a review of the Consolidated Schedule Phases 1, 2, and 3 and the potential impact and actions. Phase 1 Now that Phase 1 has been completed, it’s business as usual for current Schedule holders. eMod is open and there are no changes to the modification instructions or requirements. If you wish to submit a new offer, it must now be under the Consolidated Schedule versus the individual Schedules. GSA continues to use the preponderance of work North American Industry Classification System (NAICS) as the standard to determine business size at the Schedule contract level. Phase 2 In order for your contract to automatically transition, current Schedule contractors must accept the updated terms and conditions outlined in the Mass Mod in early FY2020. With Schedule consolidation, current Schedule holders will maintain their current contract number. You will not need to apply for a new contract. GSA eLibrary will be updated automatically upon acceptance of the Mass Mod in Phase 2 and all SINs will be migrated automatically. To ensure GSA Advantage and the text file price list are up to date, contractors will need to submit an update in SIP or EDI. An important note and frequent question – When a contractor accepts the Mass Mod in Phase 2, they will NOT automatically be able to sell anything they want on their Schedule contract without formally adding the items/services via a modification and following the same modification instructions. Phase 3 Consolidation of multiple contracts into a single contract, if applicable. GSA will be publishing additional guidelines and will work with companies on an individual basis to help determine the best path for consolidation. If you are planning to submit a new offer or if you have a Schedule and need help preparing modifications, preparing for the Industrial Operations Analyst (IOA) assessment, learning the Federal Acquisition Regulations (FAR) Ordering Process, and reviewing your Commercial Sales Practices and Basis of Award compliance, please consider attending Boot Camp for GSA Schedules on November 5-6 in Tysons, VA. If you have any questions, email our Training Manager Lali Munoz at lmunoz@centrelawgroup.com If you have any questions on the Consolidated Schedule, please contact our GSA team. About the Author: Maureen Jamieson Executive Director of Consulting Maureen Jamieson has more than twenty-five years of experience managing federal contracts. Maureen is highly experienced in solving client pricing problems and implementing effective pricing strategies for placing products and services on GSA Schedule contracts. Maureen also frequently works with clients on effective selling and marketing strategies in the federal market space and is highly skilled as a federal contracts capture or proposal manager. The post Congratulations GSA! As Promised, the Consolidated Schedule was Released on October 1 appeared first on Centre Law & Consulting. View the full article
  14. By Hon. Jack Delman Under the FY 2018 NDAA, House and Senate Committee Reports called for GAO to examine the effects of Offshoring (OS) and Foreign Direct Investment (FDI) on the Defense Supplier Base. GAO reviewed the available public data and convened a panel of experts from academia, industry, and government to address the issues. It submitted a lengthy report to Congress on September 5, 2019, and we provide a brief summary below. There was no consensus on the definition of OS. Broadly defined, it refers to the shifting of domestic production to a facility abroad, the expansion of a US corporation overseas without a change to domestic production, and the overseas sourcing of products and materials. FDI, per the definition of the Department of Commerce’s “Bureau of Economic Activity,” involves an investment transaction by a foreign entity with a US business equivalent to 10% or more of voting ownership. GAO noted that the lack of comprehensive data precluded a full understanding of the extent and magnitude of OS activities on the Defense Supplier Base. Nevertheless, panelists were able to distill certain general benefits, risks, and recommended strategies. OS/FDI Benefits, Risks, Recommendations Overseas production may bring lower labor cost, which can be passed through to the government. FDI provides domestic businesses with access to additional, critical financial resources. On the risk side — OS and DFI can lead to the transfer of critical technologies to our adversaries. This includes “dual-use” technologies, i.e., those which have a present commercial use but have the potential for military application. The panelists also noted the risk of technology transfer from “defense trade offset agreements,” where a foreign country that purchases a weapon system insists that a portion of the production be performed in the purchasing country. The panelists recommended the implementation – via rulemaking–of recent legislative initiatives in the area. One such statute was the “Foreign Investment Risk Review Modernization Act of 2018” which increased the types of foreign investment transactions subject to review by the multi-agency Committee on Foreign Investment in the United States. Another statute was the “Export Control Reform Act of 2018,” which expanded the definition of the technologies that are subject to export control. The panelists also recommended the need to increase private sector awareness of technology transfer risk, and the need to work with our allies to minimize illicit technology transfers. The Global Supply Chain: Benefits, Risks, Recommendations DOD benefits when it can turn to foreign sources to obtain needed parts and materials that are unavailable domestically. However, increased reliance on these sources has reduced visibility into the supply chain. This reduced visibility has inhibited DOD’s ability to identify high-risk suppliers that can introduce counterfeit or compromised parts into the supply chain, affecting the production of secure weapon systems. Panelists recommended that supply chain risks and security be addressed in the acquisition process, i.e., in acquisition planning and source selection; that greater responsibility to secure the supply chain be shifted to contractors; and that DOD increase coordination and communication with the private sector to facilitate a better understanding of the overall risks. Growing the Capacity and Capability of the Defense Supplier Base (DSB) The panelists discussed the growing threat of a US workforce deficient in science, technology, engineering, and math (STEM) to meet the future capacity and capability demands of the DSB (the “skills gap”). Panelists suggested increasing government support of programs to incentivize students to pursue STEM careers; leveraging the STEM skills of foreign workers and students living here; and encouraging more tech-based domestic companies to do business with the government. About the Author: Hon. Jack Delman Retired Judge Jack Delman served as a judge on the Armed Services Board of Contract Appeals for 29 years and has extensive experience in the adjudication and mediation of large and complex contract disputes, including equitable adjustments, terminations and cost and pricing issues. Jack has extensive experience with claims analysis, FAR and DOD agency regulations and BCA practice and procedure. The post GAO Report: Offshoring/Foreign Direct Investment – Risks to the Defense Supplier Base? appeared first on Centre Law & Consulting. View the full article
  15. By Tyler Freiberger, Esq., More than one year ago the Federal Housing Finance Agency Special Adviser Simone Grimes testified before Congress describing a former North Carolina representative, and then FHFA Director, Mel Watt’s repeated sexual advances toward Ms. Grimes. As Grimes testified to, and the FHFA Office of Inspector General confirmed, each time Grimes expressed that she was being paid less than her male predecessor, Watt steered the conversation toward his attraction to her. In response, Centre Law & Consulting, with the Seltzer Law Firm, were proud to represent Grimes before the Court of Federal Claims and the Equal Employment Opportunity Commission, in her suit against Watt and the Agency for the repeated violations of the Equal Pay Act and Title VII of the Civil Rights Act. Now three years after Watt’s actions, the FHFA has announced an agreement with Grimes. While Grimes reports she is happy with the resolution of her claims, Watt himself faces little accountability for the actions as he retired from office last year. Still, the resolution of Grimes’ claims marks the first time a Senate-confirmed nominee was successfully challenged, marking yet another milestone for the #Metoo movement. As stated by Grimes, “…while this is a small victory there is more work to be done.” While the #Metoo movement continues to push for strict enforcement of the Equal Pay Act and sexual harassment provisions of Title VII; in general employment developments, the DoL released a final rule raising the minimum standard salary level. Currently, the Fair Labor Standards Act allows salaried employees making at least $455 a week ($23,600 a year) to be exempt from the FLSA if they perform certain job duties. The rule, implemented on January 1, 2020, raises that minimum salary to $684 per week ($35,568 a year). This rule is estimated to shift over a million American workers from the exempt status to non-exempt status, thereby requiring overtime pay for many more employees. However, some results of the new rule are employee-friendly. The test for “highly compensated employees,” another way some particularly well-paid employees would be exempt, has been raised by about 7%. This increase is far less than the previously anticipated 20% which would have again shifted many employees from exempt to non-exempt. Lastly, the rule will allow employers to count some bonuses toward these two new salary standards, a small win for the employers. About the Author: Tyler Freiberger Associate Attorney Tyler Freiberger is an associate attorney at Centre Law & Consulting primarily focusing on employment law and litigation. He has successfully litigated employment issues before the EEOC, MSPB, local counties’ human rights commissions, the United States D.C. District Court, Maryland District Court, and the Eastern District of Virginia. View the full article
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