So Close and Yet So FAR

Despite its official passage into law and SBA’s implementation, some contracting officers in federal agencies are waiting for the addition of official language to the Federal Acquisition Regulation (FAR) to use the new sole source authority in the women’s procurement program. We have seen first hand that regardless of SBA’s assurances that the law is ready to use, some agencies are reticent to use the new authority until the FAR has officially adopted the change in law. The Federal Acquisition Regulatory Council has already drafted the rule, which is currently in a review phase. And so we wait.

 

sole sourceOn October 14th, after many years of advocacy spearheaded by WIPP, sole-source authority for Women Owned Small Businesses (WOSB) officially went into effect.  The Small Business Administration (SBA) fast-tracked its official rule authorizing WOSB sole-source, allowing Contracting Officers to cite the rule and award sole source contracts. SBA encouraged agencies to use the new law upon release—before the October 14 date.  

 

How can women business owners speed the process and become an early pioneer in sole source contracts? Sharing key information with federal agencies is important. Small business offices as well as the contracting community need education on the program.  Since this is the newest small business contracting program on the books, many acquisition officials are still getting used to it.  The sole source piece, although mirroring the HUBZone program, is brand new and worthy of explanation.

 

Resources from WIPP such as the criteria for a WOSB sole source article, SBA’s final rule on sole source, and any future rulings by federal agencies reinforcing sole source awards for WOSBs, can help Contracting Officers support a sole source justification. ChallengeHER events now being held around the country are an excellent venue for learning about the WOSB program and recent changes.  

 

And, it is important to dispel the myth that sole source justifications can only be used if your company is the only company in the universe that has a particular product or performs a specific service. Take a look at other sole source justifications found at FBO.gov. You will find that reasons such as close proximity to the buyer, employing the most highly skilled staff, and the ability to customize a product have all served as justifications for sole-source awards in other programs.
We are so close but every day that the FAR Council fails to act, some woman owned company stands to lose what could have been a contract award.  WIPP, through its advocacy, will continue to do what it takes to get this final piece in place.  

“Fair Pay” Rules Just Aren’t Fair

women comp

By John Stanford, WIPP Government Relations

Women Impacting Public Policy (WIPP) recently submitted comments on proposed regulations that would require federal contractors to disclose labor violations from the past three years. This blog accompanies those comments as a summary of WIPP’s position. For more details or if this impacts your business, I encourage you to read the full comment here.

Last summer, President Obama issued an Executive Order with the goal of barring bad companies from winning federal contracts. WIPP, along with most in the contracting community, agrees that companies that follow the rules should not have to compete against companies that break them for federal contracts.

In May, the Labor Department and the FAR Council (overseers of contracting rulebook, “the FAR”) proposed how the President’s order would be implemented. It turns out, as with most things, the devil is in the details.

The proposed regulations require federal contractors and subcontractors to disclose violations of 14 federal labor laws and equivalent state laws from the previous three years. Exemptions were provided for companies with contracts valued less than $500,000. As proposed, prospective federal contractors would need to declare if they had labor violations in the previous three years when submitting an offer. During an initial evaluation, contracting officers would see that declaration (a simple “yes” or “no”), without any additional detail or explanation.

Later, if a contractor were likely to win an award, the contracting officer would have to decide if the contractor is a responsible company (a requirement of all government contracts already). It is in this phase that details like appeals, remediation, or mitigating factors could be explained. Contracting officers will attempt to identify companies with “serious”, “willful”, “repeated”, and/or “pervasive” violations and not award them contracts. Companies with minor violations could still be considered responsible and win contracts.

WIPP responded to the regulation during the public comment period expressing concerns with the new system and how it could negatively impact women-owned businesses, including those who had no history of unsafe or unfair work practices.

Notably, the proposals were incomplete as the Labor Department and FAR Council chose not to include what state labor law violations must be reported. It is impossible to gauge the impact of a regulation – the reason for comments– when missing significant portions.

What was in the proposals, however, was equally concerning. WIPP’s comment discusses how, in some cases, violations that require reporting will not be be fully adjudicated. That is, companies would have to report decisions against them that may ultimately be overturned – as nearly a third of NLRB decisions have been.

This is compounded by WIPP’s worry that simply having violations on record will “blacklist” companies without providing any opportunity to offer explanation. With limited resources and time, contracting officers may elect to avoid companies with any disclosed violations, despite the intent of the order to only bar violations of a certain severity.

The comment also considers burdens on subcontractors who similarly must report violation history, and the lack of resources the government may face to answer questions about weighing different labor violations. Moreover, the onus to collect and judge subcontractor violations falls to primes, a strategy the Labor Department itself questions.

WIPP’s final concern is that this rule is one of many in a disconcerting trend of new regulations that specifically target federal contractors. Earlier this year, regulations raised the minimum wage solely for workers on federal contracts. New requirements regarding sick leave are expected to come later this year. These make contracting with the federal government more onerous, particularly for women entrepreneurs seeking to enter the market.

Without question, WIPP supports efforts by the federal government to rid the contracting environment of businesses with a history of abusive and neglectful violations. In doing so, the government levels the playing field for the millions of businesses playing by the rules. But the proposals commented on will not achieve this goal. Instead, they will make it harder to be a contractor – pushing the innovative products and services of women-owned businesses out of the federal market.