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Reject LH Invoice for Inadequate Performance


GinaK

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If a contract employee has proven to not perform at the level reasonably expected for the labor category being charged, and the tasks assigned, can we reject the invoice for those labor hours?

The employee was on the government site, and tried to learn how to do the job by contacting others, and others helped her perform tasks the Contract PM & team lead assigned to her. I don't see why the government should pay for an employee to try to learn how to do the work, nor pay for her hours when another contract employee who is performing labor hour tasks. This has been going on for 1 1/2 years. The contractor put the employee on a performance improvement plan, but that did not resolve the issue. The employee was finally removed from the contract & government facility. However, the contractor wants to charge us for her time.

Shouldn't the Government only pay for adequate performance, not just because someone was on site, and trying to figure out how to do the job?

This is a task order off of a GSA contract that has FAR 52.212-4

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Consider starting your analysis with paragraph (h) of the "Inspection--Time-and-Material and Labor-Hour" clause at FAR 52.246-6: "[T]he Government may at any time require the Contractor to remedy by correction or replacement, without cost to the Government, any failure by the Contractor to comply with the requirements of this contract, if failure is due to...the conduct of one or more of the Contractor's employees selected or retained by the Contractor after any of the Contractor's managerial personnel has reasonable grounds to believe that the employee is habitually careless or unqualified." If that doesn't apply, to me the next step would be to look to para (a)(3) of 52.232-7.

Edit: Apologies. I didn't see the last line: "This is a task order off of a GSA contract that has FAR 52.212-4."

Edited by Jacques
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GinaK, because the contract is subject to 52.212-4, and if it truly is a labor-hour contract, the contract should contain 52.212-4 Alt I. If it does, read that clause because it applies instead of 52.232-7 or 52.246-6.

Clause 52.212-4 definitely is in the contract. This task order (off a GSA GWAC) has FFP and LH CLINS. I was told that we cannot reject part of a LH invoice, but rather must somehow request DCAA audit it. That we are supposed to show proof that the employee was not qualified to perform the tasks. Bottom line, the employee was charging hours on this contract (working from a government site), but could not work without the assistance of other contract employees (also charging LH). I was also instructed that "just because the contractor told us the employee was not performing adequately isn't proof but rather hearsay."

I just simply want to be a good steward of the taxpayer's money, and perform my duties in the government's best interest.

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It seems to me there is a huge difference between "a contract employee has proven to not perform at the level reasonably expected for the labor category being charged" and "the employee was not qualified to perform the tasks."

The former is a matter of subjective evaluation, while the latter may be a matter of contract breach and possible violation of the False Claims Act.

Hope this helps

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The Contract employee was unable to perform the tasks. If the employee is unable to perform the tasks that would be required for this labor category, doesn't that mean she is not qualified?

Bottom line, if a contractor is charging the government for the labor hours this employee when this person has not done anything productive on the contract, then what is the government's remedy?

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If the contract clause at FAR 52.212-4 with its Alternate I is in the order, then paragraph ( a )( 6 ) will apply if any re-work was needed.

Whether or not re-work was required, the hours of an unqualified employee are not chargeable -- see paragraph ( i )( 1 )( B ). That paragraph also limits payment to hours "performed on the contract".

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Ginak this might helpful too....while not detailed it might get you headed it the right direction....

FAR 8.406-3 Remedies for nonconformance. (a) If a contractor delivers a supply or service, but it does not conform to the order requirements, the ordering activity shall take appropriate action in accordance with the inspection and acceptance clause of the contract, as supplemented by the order. (B) If the contractor fails to perform an order, or take appropriate corrective action, the ordering activity may terminate the order for cause or modify the order to establish a new delivery date (after obtaining consideration, as appropriate). Ordering activities shall follow the procedures at 8.406-4 when terminating an order for cause.
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Do you have any indication why this went on for a year and a half? Were invoices for that person's work paid throughout that time? Seems interesting that this comes up now after such a long time of that person not performing to expectation.

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In addition to what Despardo asks, have you read the governments responsibilities in 52.212-4? Services are presumed to have been provided... 60 days...as soon as possible...

...after 1 1/2 years...REALLY?

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In addition to what Despardo asks, have you read the governments responsibilities in 52.212-4? Services are presumed to have been provided... 60 days...as soon as possible...

...after 1 1/2 years...REALLY?

Joel,

I have read 52.212-4. What we are having a problem with is the process to not accept inadequate services.

The invoices are submitted through WAWF, but the COR cannot accept or reject them. Only DCAA can do so. They have already accepted the latest invoice we want to reject. I have emailed DCAA, but no response. I was directed by the CO to get signed statements by people who can state that the person was not performing, and that we have to request DCAA perform an audit.

I don't understand why the COR is not in the WAWF loop. Is this the norm?

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Why is DCAA reviewing invoices for a commercial item contract? You have two issues here. First, is what is your right to not pay the contractor for services rendered by the employee. If you look at alt I (I)(1)(B ), you will see that your right not to pay the contractor is if labor is provided by someone who does not meet the qualifications specified in the contract. This means you have to look at the contract and see if the individual meets the qualifications specified in the contract. Typically, qualifications are stated in terms of years of experience and or educational achievement. If that is the case with your contract and the employee meets those qualifications, you cannot refuse to pay the contractor under that provision merely because the employee is incompetent. To verify that the employee meets the qualifications specified in the contract, you do not need a DCAA audit. Alt I gives the contracting officer the right to review contractor records to determine if this requirement has been met.

Next, you have said that the employee requires help in performing under the contract. However, you have not said that the product she submits with that help does not meet contract requirements. If the work does meet requirements when submitted to the government, you cannot invoke Alt I(i)(1)(B ) because no rework would be required.

I think you are finding out why T&M/LH contracts are the least preferred contract type from the government's perspective. They are designed to encourage inefficiency on the part of the contractor, with little or no incentive to control costs. Maybe what you need to do is have a conversation with the contractor to discuss the contractor's management of the contract, which I am sure will be evaluated in the CPARS.

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Retreadfed asked "Why is DCAA reviewing invoices for a commercial item contract?"

That is one of those questions that, if investigated and answered, and if the answers were made public, might well shine a light on pretty much everything that's wrong with Federal acquisition in today's environment.

Obviously that's just my opinion, but oh, how I wish somebody with the willingness to name names would pull deeply on that thread.

H2H

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