Stop Work Order

[PATRICK3]

I have a commercial contract that needs to be paused, due to a strike going on. I know Stop Work orders are done for non-commercial contracts, but I was wondering what advice people could provide in this situation. The strike may last a few days or even longer. Thanks 

[ji20874]

A strike does not necessitate a Stop Work order.

Generally, a company's contractual obligations remain in place even when it faces a strike.  Assuming you are Government, why do you want to relieve the contractor of its contractual obligations because it may face a strike?  Do you need anything beyond what is already provided for in under excusable delays in para. (f) of the contract clause at FAR 52.212-4 give you the coverage you need?

My advice is to drill down on the question:  WHY are you thinking about a Stop Work order?

Why do you want to relieve the contractor of its responsibilities, and why do you want your agency to assume any and all costs associated with the contractor's stopping work?

My advice is not to rush to a Stop Work order.

[PATRICK3]

@ji20874I get that, but if the country is having a strike, how are we going to harm the contractor for this contract? Can we use the 52.212-4 to use a delay? Thanks

[Voyager]

2 hours ago, PATRICK3 said:

I have a commercial contract that needs to be paused, due to a strike going on. I know Stop Work orders are done for non-commercial contracts, but I was wondering what advice people could provide in this situation. The strike may last a few days or even longer. Thanks 

FAR 52.212-4 says (with my emphasis):

Quote

(f) Excusable delays. The Contractor shall be liable for default unless nonperformance is caused by an occurrence beyond the reasonable control of the Contractor and without its fault or negligence such as, acts of God or the public enemy, acts of the Government in either its sovereign or contractual capacity, fires, floods, epidemics, quarantine restrictions, strikes, unusually severe weather, and delays of common carriers. The Contractor shall notify the Contracting Officer in writing as soon as it is reasonably possible after the commencement of any excusable delay, setting forth the full particulars in connection therewith, shall remedy such occurrence with all reasonable dispatch, and shall promptly give written notice to the Contracting Officer of the cessation of such occurrence.

My initial advice is that "excusable delays" are a matter that is crucial to contract administration, and, as shown above, a strike is excusable.  Research what "excusable" means in government contracting, and then come on back here with the results pertinent to your current problem.  Try going to Google, then in the search box typing...

Quote

site:cofc.uscourts.gov "excusable delay"

...then reading as much as you have time to read.

I promise to help you today if you first help yourself by using your powers of research to reexamine the premise in your OP: "I have a commercial contract that needs to be paused, due to a strike going on."

[ji20874]

Have you read the excusable delays text in para. (f) of the contract clause at FAR 52.212-4?  You really should.

45 minutes ago, PATRICK3 said:

...how are we going to harm the contractor...

Why do you want to harm your agency?  Why do you want to shift all of the contractor's costs associated with the nationwide strike to your agency?  Let the contractor deal with the nationwide strike, and let the contractor deal with any cost impact.  After the strike, you can use the excusable delays text in your contract to accept late delivery or performance without shifting the contractor's costs to your agency. 

If a "country is having a strike," you must be outside the U.S. -- based on this new information, I most sincerely advise you not to rush a Stop Work order.  Since you have a commercial contract, I am supposing you don't have a construction contract, and you don't have a cost-reimbursement contract -- so I cannot imagine why you would want a Stop Work order.

A strike is an excusable delay -- it is already covered by your contract.  You do not need a Stop Work order to accommodate a strike.  There might be, maybe, some other facts that call for a Stop Work, but you haven't shared any such facts.

[C Culham]

53 minutes ago, Voyager said:

Try going to Google, then in the search box typing...

@PATRICK3 If you do the suggested research try an alternative search "compensable versus non-compensable delay"

[joel hoffman]

6 hours ago, PATRICK3 said:

I have a commercial contract that needs to be paused, due to a strike going on. I know Stop Work orders are done for non-commercial contracts, but I was wondering what advice people could provide in this situation. The strike may last a few days or even longer. Thanks 

Yes, as the others are saying, the contract already provides the risk allocation and resolution of the impacts  of a strike that is beyond the control of and without the fault of the  contractor or the government. The contract provides for an excused but non-compensable delay.

You should NOT alter the contractually established roles, responsibilities and risk allocations.

Edit: I would argue that It would be improper and probably beyond your authority to do so.  

[Don Mansfield]

3 hours ago, PATRICK3 said:

I get that, but if the country is having a strike, how are we going to harm the contractor for this contract?

You're not harming the contractor. If they experience an excusable delay, they get more time to complete the contract. 

[Vern Edwards]

6 hours ago, PATRICK3 said:

I have a commercial contract that needs to be paused, due to a strike going on. I know Stop Work orders are done for non-commercial contracts, but I was wondering what advice people could provide in this situation. The strike may last a few days or even longer. Thanks 

@PATRICK3 Contracts are, among other things, risk allocation devices. Some risks are allocated to one party, some to the other. This is done through contract clauses.

In the case of excusable delays, like strikes, government contracts generally allocate cost risk to the contractor and time risk to the government, within limits. By issuing a stop work order you would put the government in the position of accepting both cost and time risk. Why would you depart from the normal order of business?

If the contractor caused the strike by employing unfair labor practices in its performance, then the delay might not be excusable and the contractor would bear the risk of both cost and time. In the case of a national strike, the contractor would not be at fault.

[Vern Edwards]

@PATRICK3 See FAR 22.101-2, Contract pricing and administration, paragraphs (b) and (c):

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(b) Labor disputes may cause work stoppages that delay the performance of Government contracts. Contracting officers shall impress upon contractors that each contractor shall be held accountable for reasonably avoidable delays. Standard contract clauses dealing with default, excusable delays, etc., do not relieve contractors or subcontractors from the responsibility for delays that are within the contractors’ or their subcontractors’ control. A delay caused by a strike that the contractor or subcontractor could not reasonably prevent can be excused; however, it cannot be excused beyond the point at which a reasonably diligent contractor or subcontractor could have acted to end the strike by actions such as-

           (1) Filing a charge with the National Labor Relations Board to permit the Board to seek injunctive relief in court;

           (2) Using other available Government procedures; and

           (3) Using private boards or organizations to settle disputes.

      (c) Strikes normally result in changing patterns of cost incurrence and therefore may have an impact on the allowability of costs for cost-reimbursement contracts or for recognition of costs in pricing fixed-price contracts. Certain costs may increase because of strikes; e.g., guard services and attorney’s fees. Other costs incurred during a strike may not fluctuate (e.g.,"fixed costs" such as rent and depreciation), but because of reduced production, their proportion of the unit cost of items produced increases. All costs incurred during strikes shall be carefully examined to ensure recognition of only those costs necessary for performing the contract in accordance with the Government’s essential interest.

Again, the contractor should not be held at fault for a nationwide or citywide strike, such as you often see in countries like France and Italy. I've been caught up in several of those.

[PATRICK3]

Thanks again to @Vern Edwards@Don Mansfield and everyone who commented. This really helped.