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FAR 8.405-2(d) Evaluation of level of effort and mix of labor


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FAR 8.405-2(d) requires ordering activities to evaluate the "level of effort and mix of labor." The Advanced Technology Systems, Inc. case at GAO, B-296493.6, from Oct. 6, 2006, held that agencies had to evaluate for this when the pricing was in "hourly rates."

There are tasks on the GSA Schedule that are not priced at hourly rates for labor categories. For example, software maintenance is priced at a fixed rate by a period of time (e.g., a year) for X amount of dollars. Whether it takes 2 employees or 20 employees to provide that maintenance is of no consequence to the government. The price is a fixed-rate for the task.

So my question is, if an agency is soliciting off the GSA Schedule for a scope of work involving both services priced by task and services priced by hourly rates for labor categories, does FAR 8.405-2(d) require the agency to evaluate the "level of effort and mix of labor" for only the the hourly-rates portion of the work, or all of the work?

If it is all of the work, how would the agency evaluate for the "level of effort and mix of labor" for the work that is priced by task at a fixed-rate?

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Assume that the agency will provide the SOW.

If the ordering office must provide the SOW, then FAR 8.405-2 applies. As you pointed out, FAR 8.405-2 (d) requires you to consider the level of effort and the mix of labor proposed to perform a specific task.

If you are using the SOW in the Schedule, FAR 8.405-1 applies. Paragraph (a) states

Ordering activities shall use the procedures of this subsection when ordering supplies and services that are listed in the schedules contracts at a fixed price for the performance of a specific task, where a statement of work is not required (e.g., installation, maintenance, and repair)

FAR 8.405-1 does not require the assessment of the LOE.

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