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Government Contractors

Contractor’s Obligations to Monitor their Subcontractors

By: John Ford , Senior Consultant and Eric Poppe , Senior Manager Federal Acquisition Regulation (“FAR”) 42.202(e)(2) states that “[t]he prime contractor is responsible for managing its subcontractors.” However, the FAR does not provide further guidance as to what this means. At least one Defense Contract Audit Agency (“DCAA”) office and Defense Contract Management Agency (“DCMA”) contracting officer have contended that this means that prime contractors are to perform all the functions of a DCMA Contract Administration Office in regard to subcontractors. Based on this theory, the Administrative Contracting Officer (“ACO”) issued a claim for over $100,000,000 against Lockheed Martin Integrated Systems, Inc. (“LMIS”). Read More.

Deadline for Cybersecurity Compliance Rapidly Approaching

By: Sara Crabtree , Senior Manager and Neal Beggan , Principal No one thinks a cybersecurity breach will ever happen to their company until the day it actually happens. At that point, all of the discussions, gap analysis and planning that could have occurred to prevent the breach is but wishful thinking for the ability to rewind time. We can bet Target wishes it had discussed cybersecurity requirements with all of their subcontractors prior to finding out that a refrigeration and HVAC subcontractor was the reason that 40 million of its debit and credit card accounts were hacked at the end of 2013. In. Read More.

GAO Sustains a Bid Protest Based on an Improper Arbitration Agreement

By: John Ford , Senior Consultant Most of us have probably heard of the accusations of sexual harassment levied against the movie producer Harvey Weinstein. Some of you may not be aware that there is a government contracting aspect to this story. Section 8116 of the 2010 Department of Defense (“DoD”) Appropriations Act (P.L. 111-118) (“the Act”) provides in part that: None of the funds appropriated or otherwise made available by this Act may be expended for any Federal contract for an amount in excess of $1,000,000 that is awarded more than 60 days after the effective date of this Act, unless. Read More.

Court of Federal Claims Reverses OHA Decision finding Affiliation

Veterans Technology, LLC (“Vet Tech”) is a joint venture whose stock is owned 49 percent by a company named MDW and 51 percent by Defense Acquisition, Inc. (“DAI”). MDW was formed in 2012 by four individuals who were then employed by Paradigm Technologies, Inc. However, on January 30, 2011, ECS Federal, LLC (“ECS”), acquired Paradigm, but the acquisition did not close until January 1, 2012. Subsequently, Paradigm became a wholly owned subsidiary of ECS during calendar year 2012, and all Paradigm contracts were subsequently novated to ECS. Shortly after Paradigm was acquired by ECS, the four employees informed ECS of. Read More.

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DODIG Report on DCMA Actions Regarding DCAA Incurred Cost Audit Reports

In a recent report from the Department of Defense Office of Inspector General (“DODIG”) (DODIG-2017-055, dated February 9, 2017) the DODIG found several instances when the Defense Contract Management Agency (“DCMA”) contracting officer’s (“CO”) actions did not comply with Federal Acquisition Regulation (“FAR”), DoD Instruction 7640.02, or DCMA instructions. The findings resulted from a review of 22 incurred cost reports judgmentally selected from a pool of 1,072 Defense Contract Audit Agency (“DCAA”) incurred cost reports issued between September 2013 and July 2015. In its review, the DODIG evaluated the appropriateness of DCMA actions on DCAA findings reported in the 22. Read More.

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Department of Labor Increases the SCA Health & Welfare Rate and Establishes Two Other Rates

On July 25, 2017, the Wage and Hour Division of the U.S. Department of Labor updated and increased the McNamara-O’Hara Service Contract Act (“SCA”) Health and Welfare (“H&W”) Fringe Benefit to $4.41 per hour (i.e., $176.40 per week or $764.40 per month). The increase will be effective as of August 1, 2017. This is an increase of 14 cents per hour, up from 2015-2016 rate of $4.27. The new update also included a rate for those employees who fall under Executive Order 13706, Establishing Paid Sick Leave for Federal Contractors. A new reduced rate of $4.13 per hour (i.e., $165.20. Read More.

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