Government Contracts Regulatory Compliance

On September 9, the Biden Administration released a number of new details for its Path out of the Pandemic that will impact U.S. Government contractors and a number of other individuals and entities.  In addition to requiring most executive agency employees to receive COVID-19 vaccines, the Administration plans to mandate that executive agency contractors and subcontractors, with some exceptions, impose similar requirements on their employees pursuant to an executive order that will fully go into effect on October 15, 2021.  The overall impact of the executive order will not be clear until additional details are released in the coming weeks, but government contractors should begin considering the implications of the new requirements and take steps to ensure timely compliance.

Continue Reading COVID-19 Vaccine Requirements for U.S. Government Contractors

The FAR explains that the Government must accept or reject work as “promptly as practicable after delivery.”  FAR 52.246-2(j).  But what if the contractor knows its work is not compliant, but has asked the agency for a deviation from the contract’s terms?  A recent decision from the ASBCA provides guidance on this tough but not uncommon issue.

Continue Reading Accepting What You Can’t Change: ASBCA Holds that an Agency Must Accept Non-Conforming Goods After Waiting to Consider a Deviation

The employee non-competition agreement landscape continues to evolve rapidly, with several states enacting new limits on the use of non-competition agreements between employers and employees.  Once a valuable tool for employers to protect their businesses from unfair competition, loss of customers, or misuse of company confidential information, many states have increasingly limited the enforceability of such agreements.

The federal government is now weighing in on the appropriate use of non-competition agreements between employers and employees.  President Biden’s July 9, 2021 Executive Order asks the Federal Trade Commission (“FTC”) to limit such agreements—signaling a potential expansion of federal regulation of agreements between employers and workers.  And a pending Senate bill would ban most non-competition agreements.  Given these developments, government contractors and other employers should assess whether their use of these agreements with employees is consistent with recent state developments and aligned with the broader trend toward limiting the enforceability of these agreements.


Continue Reading Recent Federal and State Laws Restrict Use of Employee Non-Competition Agreements by Government Contractors and Other Employers

Last month, the Biden administration released its report on the results of its 100-day review of U.S. supply chains for critical products:  “Building Resilient Supply Chains, Revitalizing American Manufacturing, and Fostering Broad-Based Growth” (the “Report”).  Alongside the Report’s slate of policy recommendations, the Biden administration also announced immediate actions to strengthen supply chains and stimulate domestic competitiveness.

The Report is the result of President Biden’s February 24 “Executive Order on America’s Supply Chains” (the “Order”), which directed federal departments and agencies to conduct a review of supply chain risks in four critical product areas,[1] including pharmaceuticals and active pharmaceutical ingredients (“APIs”).  The Report and its recommendations further the Biden administration’s broader goal of rebuilding the U.S. industrial base, reducing reliance on foreign competitors, and bolstering national and economic security.

The U.S. Department of Health and Human Services (“HHS”) led the review of the supply chain for pharmaceuticals and APIs, which focused primarily on drugs, in particular small-molecule drugs and therapeutic biological products.  The Report makes a number of recommendations discussed herein that have the potential to impact pharmaceutical companies’ business plans and generate significant opportunities, though many such recommendations are long-term and will require dedicated funding so the actual impact of the Report’s suggestions remains to be seen.
Continue Reading Biden Administration 100-Day Supply Chain Assessment: Insights for Pharmaceutical Manufacturers

As GSA Multiple Award Schedule contractors know all too well, Schedule contracting involves a complex web of customer-tracking, reporting, and price-adjustment requirements.  Those of us who navigate these often byzantine rules understand why many in the industry have called for the adoption of an alternative approach to verifying price reasonableness.

For the last several years, GSA has been piloting just such an alternative:  the Transactional Data Reporting (“TDR”) program, through which the government collects transaction-level data on products and services purchased through the Schedule to make data-driven decisions that save taxpayer dollars.  GSA has been running a TDR pilot program for several years to test the potential for a new regulatory regime, though the program sometimes has been the source of criticism and controversy.  Now that controversy has heightened further:  GSA’s Office of Inspector General published an audit report on June 24, 2021 that is sharply critical of the program, only to see GSA’s Federal Acquisition Service (“FAS”) Commissioner publicly reject the report’s conclusions and defend TDR’s effectiveness.

Time will tell whether the TDR rule becomes the new standard for GSA Schedule contracting.  But the latest round of controversy suggests that the current maze of requirements are not going away any time soon.


Continue Reading The End of CSP and PRC Requirements? — GSA’s TDR Pilot Program Faces Further Internal Criticism

On April 27, 2021, President Biden signed an Executive Order entitled “Increasing the Minimum Wage for Federal Contractors” that will raise the hourly minimum wage for federal contractors to $15.00 effective January 30, 2022.  This Executive Order builds on Executive Order 13658 (“Establishing a Minimum Wage for Contractors”), issued by President Obama in 2014, which first implemented an hourly minimum wage of $10.10 for covered federal contractors.[i]

Continue Reading Government Contractors Should Prepare Now for the $15 Per Hour Minimum Wage

If your company delivers technical data to the Department of Defense, you should take a close look at the Federal Circuit’s decision issued yesterday in The Boeing Co. v. Secretary of the Air Force.

The Court acknowledged that contractors may retain ownership and other interests in unlimited rights data, and it held that they may take steps to put third parties on notice of those rights.  In particular, the Court held that, in addition to the standard legends required by the Defense Federal Acquisition Regulation Supplement (“DFARS”), contractors may also include a legend notifying third parties of the contractor’s retained rights.


Continue Reading Technically Still Yours: Court Holds that Contractors May Mark Unlimited Rights Data with a Proprietary Legend

On October 21, 2020 the Department of Labor’s Office of Federal Contract Compliance Programs (“OFCCP”) published a Request for Information (“RFI”) seeking voluntary submissions of workplace diversity and inclusion training information and materials from federal contractors, federal subcontractors, and their employees. The RFI was published pursuant to Executive Order 13950, Combating Race and Sex Stereotyping (“EO”) issued on September 22, 2020, which prohibited certain “divisive concepts” in workplace trainings and instructed OFCCP to solicit information from federal agencies and contractors about the content of their training programs.  The EO also directed OFCCP to establish a hotline to investigate complaints received under the EO, as well as Executive Order 11246. The hotline, and a corresponding email address, were established on September 28, 2020. We provided a full description and explanation of the requirements of the EO here.

Under the new RFI, contractors may submit comments and other information to OFCCP by December 1, 2020, but any submission of information is strictly voluntary.  As discussed below, prior to making any submission, contractors should consider carefully the nuances of the EO and RFI and the potential implications of making a voluntary submission.


Continue Reading Department of Labor Requesting Information on Federal Contractor Workplace Diversity Training

On September 29, 2020, the Department of Defense (DoD) released an interim rule that industry hoped would provide clear guidance with regard to DoD’s implementation of its Cybersecurity Maturity Model Certification (CMMC) framework.  The vast majority of the rule focuses on DoD’s increased requirements for confirming that contractors are currently in compliance with all 110 security controls in National Institute of Standards and Technology (NIST) Special Publication (SP) 800-171 (NIST 800-171).  The interim rule also includes a clause for adding CMMC as a requirement in a DoD contract, but the clause fails to address many of the questions that industry has with regard to implementation of the CMMC program.  The rule becomes effective November 30, 2020.  We have written previously on NIST 800-171 and the CMMC here and here respectively.

DoD has been focused on improving the cyber resiliency and security of the Defense Industrial Base (DIB) sector for over a decade.  The Council of Economic Advisors estimates that malicious cyber activity cost the U.S. economy between $57 billion and $109 billion in 2016.  The interim rule is one of multiple efforts by DoD focused on the broader supply chain security and resiliency of the DIB and builds on existing FAR and DFARS clause cybersecurity requirements.  Increasing security concerns coupled with recent high-profile data breaches have led DoD to move beyond self-certification to auditable verification systems when it comes to protecting sensitive Government information.


Continue Reading Department of Defense’s Interim Rule Imposes New Assessment Requirements But is Short on Detail on Implementation of CMMC

On September 22, 2020, President Trump issued the Executive Order on Combating Race and Sex Stereotyping (“EO”) establishing requirements aimed at “promoting unity in the Federal workforce,” by prohibiting workplace training on “divisive concepts,” including “race or sex stereotyping” and “race or sex scapegoating” as newly-defined in the EO.  The EO is broadly applicable to executive departments and agencies, Uniformed Services, Federal contractors, and Federal grant recipients.  The EO expands on a letter issued in early September by the Director of the Office of Management and Budget (“OMB”) that directed all agencies to begin to identify contracts or other agency spending on trainings that include “critical race theory,” “white privilege,” or “un-American propaganda,” in an effort to ensure “fair and equal treatment of all individuals in the United States.”

Following the EO, on September 28, 2020, OMB issued a Memorandum for the Heads of Executive Departments and Agencies (the “Memo”) with additional guidance aimed at assisting agencies in identifying diversity and inclusion trainings for agency employees that may be subject to the EO.  The Memo suggests that agencies conduct keyword searches of training materials for specific terms, such as “intersectionality,” “systemic racism,” and “unconscious bias.”  Although the Memo primarily explains the terms of the EO, it also provides additional insight concerning the breadth of agency trainings that may ultimately be considered to violate the terms of the EO, which are described below.

Although the EO is likely to be subject to legal challenge (as more fully discussed below), federal contractors, including subcontractors and vendors, could be subject to the compliance requirements outlined below as soon as November 21, 2020.
Continue Reading President Trump Issues Executive Order Prohibiting “Divisive Concepts” in Federal Contractor Trainings