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  1. I wasn’t sure where to post this question, but thought this was a good place to start. First, let me describe our situation. · We are a small business with a CPFF contract · All staff members are at the Client site · Contract requires Client approval of all new personnel (sometimes done via resume review – sometimes direct interview of candidate) · All positions require a security clearance and fairly unique skills (i.e., difficult to fill positions) · Contract includes a Consent to Subcontract clause · We have several large business subcontractors · We have had difficulty filling several positions and our large biz subs have failed also Since we (and our subs) cannot fill open positions, we have considered using a staffing agency. A typical headhunter fee is 20% of the first year salary. Paying $20K for a $100K employee is not affordable – much less when you multiply that times 4 or 5 positions. Several staffing companies have offered an alternative approach which they assure us they do for other government contractors. They will employ the candidate for 6-9 months at a certain rate after which the candidate comes to work for our company. During that 6-9 month period, the company earns their fee through the hourly rate – meaning the fee is absorbed as a direct cost, not indirect. The problem is that the new hire is not our employee. Our invoices clearly indicate each employee by name and employer (with appropriate indirects and fees), so the individual’s employer would be clearly visible to the client. We have no desire to do anything underhanded or deceptive - we just need a way to fill these positions. Headhunters have huge databases and recruiting methods that even our large business subs cannot duplicate. So, the question is – can we use a staffing agency in our situation, and if so, how? An obvious answer is to add them as a subcontractor. But that is a process that takes a significant amount of time and effort (and is discouraged by our client – especially approaching the end of the fiscal year). The staffing agencies say they “do this often” with other companies without being considered a subcontractor. They use a Professional Services Agreement (PSA) or Master Services Agreement (MSA) rather than a full-blown subcontract. But I suspect they are filling positions that may be internal company positions or roles on Fixed Price contracts or other contracts that do not require subcontracting consent. There are employees and subcons. Is there a third category that can be utilized in the environment I describe above?
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