Federal contractors find, sometimes you just have to outwait a problem

Like a pile of pick-up sticks, the Biden administration's contractor vaccine mandate has collapsed in a heap. But that doesn't end the matter necessarily.

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Like a pile of pick-up sticks, the Biden administration’s contractor vaccine mandate has collapsed in a heap. After a slew of state lawsuits and unfavorable court decisions, the administration won’t enforce the mandate. But that doesn’t end the matter necessarily. David Berteau, the president and CEO of the Professional Services Council joined the Federal Drive with Tom Temin with what might come next,

Interview transcript:

Tom Temin: And David, as you see it, this thing is not really over and dead and buried, by any means, is it?

David Berteau: Tom, I love talking with you. And thanks for having me on this morning. Because exactly that — the Southern District Court, the Federal District Court of Southern Georgia, issued an injunction that enjoined enforcement of the contract clause and, in fact, the executive order itself, but it did not prevent the government from continuing to insert the contract language into new contracts or into existing contracts, as a so-called bilateral modification. And the guidance that has subsequently been issued both by [the Office of Management and Budget], in an unsigned document that we actually got from a reporter — I don’t even know if it’s on our website yet, but it has been issued across OMB — as well as guidance from [the General Services Administration and the Defense Department] to the agencies, tells them to continue putting the clause in new contracts and task orders, in extensions and modifications and in through bilateral modifications where appropriate into existing contracts. It does, however, tell them to include language when they do that, that says we’re not enforcing it. So we’re putting it in, we’re not enforcing. This, by the way is fairly common practice because the government anticipates it has already filed an appeal. The ruling was last week, and the appeal was two days later. It has already filed an appeal. It is anticipating that the injunction will be changed or modified or reversed. And and then they can begin enforcing it immediately.

Tom Temin: Basically, then, what they’ve done is put a wrapper of dynamite sticks around everybody and saying, keep this on, we just won’t like the fuse yet.

David Berteau: Well, there is that aspect to it. And of course, there’s no change in the deadline as of now. The deadline is still January 18 for all personnel to be vaccinated, or to have an accommodation improved or to be entered into some kind of process where, similar to federal civilians, they would be educated and counseled and persuaded eventually to be vaccinated. In the meantime, of course, contracting officers aren’t necessarily just sticking to only that, right? There’s still a lot of requests from contracting officers that we hear of that are not consistent with the guidance, not consistent with the contract language. For instance, a contracting officer might say I need a list of all your people who are vaccinated in which vaccines they got and when they got it. Well, the guidance clearly says you’re not supposed to be asking for that if you’re a contracting officer. But that hasn’t stopped a lot of contracting officers from doing it.

Tom Temin: Plus, if they can enforce this clause later. is there any notion yet that’s clear of what enforcement will actually look like?

David Berteau: No, there’s not. There’s no clear top down guidance of enforcement and PSC has argued on behalf of our members that, in fact, there should be guidance that goes to contracting officers. We think that really that guidance should include here’s what you can do and what you can’t do. The guidance is in the safer Federal Workforce Task Force guidance on the website and in the FAQs. But we all know, Tom, that contracting officers are quite busy and not all of them get up every morning and look to see if there are any new or updated FAQs in the guidance. And so it’s incumbent on the companies to backtrack all this and to help keep it in line. On top of that, completely separate from the FAR clause in the contract language in the executive order itself is the question of access to government facilities, where, you know, each agency — GSA and DoD in particular — has sent out guidance that says you make these determinations. And the determinations of whether you have to have vaccinations in order to come in and what constraints might be there actually varies depending on the case rate within the county, whether it’s moderate or low or substantial or high. And it can change without warning in terms of requirements. Not only that, it extends overseas where the contract clause for vaccinations doesn’t even apply. So it’s a very complicated work environment for anybody who’s in the federal services business.

Tom Temin: We’re speaking with David Berteau, president and CEO of the Professional Services Council. And just switching gears here, I want to get to the Senate NDAA, which presumably is the same as the House one that was passed, because they had the reconciliation before the votes. And so you’re happy with how it looks, presuming it gets enacted within a few days?

David Berteau: Right, so that the Senate of course could not agree on taking up its own version of the bill. So the staff and the committee’s conference that, without official conference committee having been named, and a revised version was passed by the House last week, and we expect it to be undertaken by the Senate this week. A lot fell out, Tom, a lot of things fell out through that. And we’re still parsing through what’s missing, because they’ll give you a list of what’s in it, but they don’t give you a list of what came out. So you actually have to go back and compare them against the previous versions of the bill that are there. One of the things that did fall out, which we were happy to see, was a reinstatement of the so called blacklisting clause language, which would essentially enable a complaint to be filed, even if it’s spurious and could cause suspension and debarment of a contractor simply because of accusation of fair labor practices violations. As you know, PSC has supported, for many years, the proper use of the Labor Department’s Office of Federal Contract Compliance Programs, OFCCP, to enforce those, those rules, which, you know, are in everybody’s contract and companies comply with diligently across the board. But OFCCP doesn’t actually have enough staff. So what this attempted to do was put contracting officers in the role of enforcing labor laws. And we actually think that the Labor Department should be in the role of enforcing labor laws. So we were happy to see that fall out.

Tom Temin: Yeah, there’s a trend here, both when we were talking about the vaccine mandate, and also this non-existent now blacklisting clause. The idea of putting more and more and more responsibility for peripheral issues on contracting officers,

David Berteau: Contracting officers, and of course, on the companies and companies who do federal contracting, are very good at complying, right. I mean, FAR is full of rules that you have to comply with. And these are often terms and conditions that are incorporated by reference. They’re not actually even spelled out in your contract. So you really have to know what you’re compliant with as you go forward and report on that. Putting that burden on contracting officers who are already overworked and too thin in numbers, and perhaps not fully trained in those areas, and on the companies themselves, does add responsibility, adds costs and adds time. Nonetheless, the federal government, of course, does have the right to require its contractors to be better than the average company. And from PSC’s experience, I remember, companies actually are better than the average company.

Tom Temin: And then anything new on the non-displacement of contractor employees? When the incumbency changed, we spoke with Stephanie Castro about this a couple weeks ago, this is something else that impinges on the contracting officer company relationship, too. But that’s an executive order that’s kind of floating there.

David Berteau: And it’s a repeat, it’s a deja vu, from, you know, 2009-2010, the original executive order essentially giving a new company, who just beat an incumbent, a unilateral right to first right of refusal to hire all the losing companies’, the incumbent companies’, employees, even if, in fact, the pay is lower, and the benefits are less, which is often what they’ve done in order to win that contract, right? We think this is unfair to the companies you’ve invested in recruiting and training and promoting and retaining those workers. We think it’s unfair to the workers, because they’re going to be captive have a different set of pay and benefits. And because the way contracts are often awarded, it will be less pay and fewer benefits. And we think it flies in the face of, in fact, giving the government what it really needs. The government’s hiring a contractor, they’re not hiring people through a contractor. The contractor is responsible for the companies. Now, as I said, this is deja vu. It was in the FAR for a number of years. It was eliminated in the previous administration, it’s now come back in again. We expect an interim rule FAR rule — Federal Acquisition Regulation rule — to be issued, and a comment period to ensue. We’re preparing to provide those comments, along with comments on a host of other executive orders: climate change, zero emissions, etc. You know, it’s a robust environment for PSC to be representing our members through the official comments process and the unofficial comments process as well.

Tom Temin: And just one other comment on that non-displacement rule. I mean, as a practical matter, companies often do take on people from the previous incumbent, but that should be left to the fluidity of the dynamic marketplace, in other words, and not to an executive order, stating, you’ve got to have this whole apparatus for taking on those people.

David Berteau: Absolutely. And it takes away the freedom of choice of the workers to decide who they want to work for and where they want to work. It basically gives them fewer choices and less mobility, which, given the current state of the economy and the fact that we still have more jobs than we have workers, that’s not going to go well for the federal government, I don’t think.

Tom Temin: David Berteau is president and CEO of the Professional Services Council. As always, thanks so much.

David Berteau: You’re welcome, Tom.

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