Government contracts, introduction

Scope

The General Services Administration (GSA) is the federal government’s business manager, buyer, real estate developer, telecommunications manager, and IT solutions provider. GSA offers businesses the opportunity to sell billions of dollars’ worth of products and services to federal agencies through contract vehicles.

Regulatory citations

• None

Key definitions

• None

Summary of requirements

The General Services Administration (GSA) is the federal government’s business manager, buyer, real estate developer, telecommunications manager, and IT solutions provider. GSA offers businesses the opportunity to sell billions of dollars’ worth of products and services to federal agencies through contract vehicles.

There is a ton of information on “how to sell to the government” online. Websites such as www.firstgov.gov and www.sba.gov/ (for small businesses) have ample information on how to get started and where to get help.

However, there isn’t much to be seen regarding the laws that kick in if you accept a government contract valued at a certain amount. The links in this topic will guide you through the government’s laws, acts, and regulations regarding the information you need to know to administer a government contract.

Government contracts, grants, or financial aid. Recipients of government contracts, grants or financial aid are subject to wage, hour, benefits, and safety and health standards under:

• The Davis-Bacon Act, which requires payment of prevailing wages and benefits to employees of contractors engaged in federal government construction projects;
• The McNamara-O’Hara Service Contract Act, which sets wage rates and other labor standards for employees of contractors furnishing services to the federal government;
• The Walsh-Healey Public Contracts Act, which requires payment of minimum wages and other labor standards by contractors providing materials and supplies to the federal government.

Administration and enforcement of these laws are by the Wage and Hour Division. The Employment Standards Administration (ESA)’s Office of Federal Contract Compliance Programs (OFCCP) administers and enforces three federal contract-based civil rights laws that require most federal contractors and subcontractors, as well as federally assisted construction contractors, to provide equal employment opportunity. The Office of the Assistant Secretary for Administration and Management’s (OASAM) Civil Rights Center administers and enforces several federal assistance based civil rights laws requiring recipients of federal financial assistance from Department of Labor to provide equal opportunity.

Construction. Several agencies administer programs related solely to the construction industry:

• OSHA has special occupational safety and health standards for construction in 29 CFR, Part 1926 ;
• ESA’s Wage and Hour Division, under Davis-Bacon and related acts, requires payment of prevailing wages and benefits;
• ESA’s Office of Federal Contract Compliance Programs enforces Executive Order 11246, which requires federal construction contractors and subcontractors, as well as federally assisted construction contractors, to provide equal employment opportunity; and
• The anti-kickback section of the Copeland Act precludes a federal contractor from inducing any employee to sacrifice any part of the compensation required.

Federal Acquisition Regulation (FAR). The body of regulations which is the primary source of authority governing the federal government’s procurement process are the Federal Acquisition Regulations (FAR). The FAR, which is published as Chapter 1 of Title 48 of the Code of Federal Regulations , is prepared, issued, and maintained under the joint auspices of the Secretary of Defense, the Administrator of General Services Administration, and the Administrator of the National Aeronautics and Space Administration. Actual responsibility for maintenance and revision of the FAR is vested jointly in the Defense Acquisition Regulatory Council (DARC) and the Civilian Agency Acquisition Council (CAAC ).

Government contractor provisions in the Employee Polygraph Protection Act (EPPA). In general, the Employee Polygraph Protection Act puts limits on how employers can administer lie detection tests to employees. However, certain government contractors are exempt from the Act’s provisions. The federal government can administer lie detector tests to contractors and their employees under the Act’s National Defense and Security Exemption.

• The exemption allows the federal government, in the performance of any counterintelligence function, to give lie detector tests to contractors and their employees who work for the Department of Defense, the Department of Energy (when the contract is in connection with atomic energy defense activities), and the Federal Bureau of Investigation.
• The federal government, in the performance of any intelligence or counterintelligence function, can give lie detector tests to contractors and their employees who work for the National Security Agency, the Defense Intelligence Agency, the Central Intelligence Agency, or any federal government department, agency, or program whose duties involve access to information that has been classified at the level of top secret or designated as being within a special access program under section 4.2(a) of Executive Order 12356 (or a successor Executive order).

Under the exemption, the law puts little restriction on how the federal government can use lie detector tests for the above national defense and security reasons. The federal government can use any type of lie detector (deceptograph, voice stress analyzer, psychological stress evaluator, or any other similar device). The government is not limited to using polygraphs, which simultaneously record changes in cardiovascular, respiratory, and electrodermal patterns.

These agencies can conduct their lie detector tests without having to meet the Act’s provisions for using the test as the basis for adverse employment action, the rights of the examinee, the qualifications of examiners, or the disclosure of results.

Rehabilitation Act, Section 503. Under Section 503 and its implementing regulations, covered employers with federal contracts or subcontracts must take affirmative steps to employ qualified individuals with disabilities, including recruitment, hiring, rates of pay, upgrading, and selection for training. All covered contractors and subcontractors must also include a specific equal opportunity clause in each of their nonexempt contacts and subcontracts.

In addition, covered federal contractors and subcontractors must make reasonable accommodations for the known physical or mental limitations of qualified individuals with disabilities, unless providing an accommodation would create an undue hardship. Furthermore, covered contractors and subcontractors are required to take all necessary actions to ensure that no one attempts to intimidate or discriminate against any individual for filing a complaint or participating in a proceeding under Section 503.

Affirmative action in government contracting. When a non-construction (service and supply) government contractor has 50 or more employees and a contract of $50,000 or more, the contractor also must prepare and maintain an affirmative action program. As part of this program, contractors are obligated to institute outreach and recruitment efforts to employ and advance qualified individuals with disabilities at all levels of employment, including the executive level.

• Affirmative action requirements also apply to construction contractors and subcontractors that hold any federal or federally assisted construction contract in excess of $10,000.
• The regulations implementing affirmative action establish different provisions for non-construction (i.e., service and supply) contractors and for construction contractors.
• Affirmative action regulations for non-construction (service and supply) contractors are found at 41 CFR 60-2. Requirements for construction contractors are found at 41 CFR 60-4.