United States: Legislative And Regulatory Update - September 2018

Our September edition of "Government Contracts Legislative and Regulatory Update" offers a summary of the relevant changes that took place during the month of August.

Highlights this month include:

  • FY 2019 National Defense Authorization Act Signed into Law
  • FAR Council Issues Final Rule Regarding Paid Sick Leave for Federal Contractors (FAR Case 2017-001)
  • FAR Council Issues Final Rule for Non-Retaliation for Disclosure of Compensation Information (FAR Case 2016-007)
  • DoD Issues Final Rule Repealing Technical Interchange Requirement for IR&D
  • DoD Issues Proposed Rule Regarding Contractor Completion of Anti-Terrorism Awareness Training
  • DoD Issues Proposed Rule Clarifying Applicability of Buy American Exceptions to Photovoltaic Devices
  • DOD Issues Proposed Rule Regarding Performance-Based Payments
  • DoD Issues Proposed Rule to Allow More Than Five Offerors on Two-Phase Design-Build Solicitations

LEGISLATION

FY 2019 National Defense Authorization Act Signed into Law

As previously reported, President Trump signed the John S. McCain National Defense Authorization Act for Fiscal Year 2019 (NDAA) into law (Pub. L. No: 115-232) on August 13, 2018. Our insight regarding key provisions of the NDAA is available here.

REGULATIONS

FAR Council Issues Final Rule Regarding Paid Sick Leave for Federal Contractors (FAR Case 2017-001)

On August 22, 2018, DoD, GSA, and NASA converted to a final rule, without change, the interim rule that promulgated the paid sick leave regulations applicable to certain government contracts. The interim rule, issued on December 16, 2016, amended the FAR to implement Executive Order (EO) 13706 and a Department of Labor final rule, both titled Establishing Paid Sick Leave for Federal Contractors, which Dentons previously analyzed. The interim rule applied to contracts and subcontracts at all tiers covered by the Service Contract Labor Standards statute, or the Wage Rate Requirements (Construction) statute, which require performance in whole or in part within the United States. For procurement contracts where employees' wages are governed by the Fair Labor Standards Act, the interim rule applied when the contract exceeded the micro-purchase threshold, as defined in FAR 2.101. The rule required contractors to allow all employees performing work on or in connection with a contract covered by the EO to accrue and use paid sick leave in accordance with EO 13706 and 29 CFR Part 13. As a result, covered employees could earn up to 7 days or more of paid sick leave annually, including paid sick leave for family care. Government contractors are subject to these requirements when their contracts include FAR 52.222-26, Paid Sick Leave Under Executive Order 13706. These provisions were already in effect because of the prior interim rule, but now have been adopted as final in the FAR. (83 Fed. Reg. 42569, Aug. 22, 2018.)

FAR Council Issues Final Rule for Non-Retaliation for Disclosure of Compensation Information (FAR Case 2016-007)

On August 22, 2018, DoD, GSA, and NASA adopted as final, without change, an interim rule amending the FAR to implement EO 13665, Non-Retaliation for Disclosure of Compensation Information. The interim rule, originally issued on September 30, 2016, also implemented a final rule issued by the Department of Labor. The interim rule made adjustments to FAR Subpart 22.8, FAR 52.222-26, Equal Opportunity, and related clauses. For example, it added the discrimination prohibition at FAR 22.802. It also added definitions to FAR 52.222-26 for the terms "compensation," "compensation information," and "essential job functions." It also added paragraph (c)(5) to FAR 52.222-26, prohibiting contractors from discharging, or in any manner discriminating against, any employee or applicant for employment because the employee or applicant inquired about, discussed, or disclosed the compensation of the employee or applicant or another employee or applicant. These provisions were already in effect based on the prior interim rule, but now have been adopted as final in the FAR. (83 Fed. Reg. 42570, Aug. 22, 2018.)

DoD Issues Final Rule Repealing Technical Interchange Requirement for IR&D

On August 24, 2018, DoD issued a final rule to remove the technical interchange requirement for major contractors that intend to generate independent research and develop (IR&D) costs. The final rule removes the text at DFARS 231.205-18(c)(iii)(C)(4). This provision required major contractors to engage in and document a technical interchange with the Government prior to generating IR&D costs for IR&D projects initiated in fiscal year 2017 and later, in order for those costs to be determined allowable. With the promulgation of the final rule, major contractors no longer are required to participate in technical interchanges to ensure their IR&D costs will be allowable. The final rule follows Class Deviation 2017-O0010 issued by Director of Defense Pricing Shay Assad, dated September 14, 2017 and discussed by Dentons here, which removed the requirement for major contractors to engage in and document technical interchanges with DoD. (83 Fed. Reg. 42787, Aug. 24, 2018.)

DoD Issues Proposed Rule Regarding Contractor Completion of Anti-Terrorism Awareness Training

On August 24, 2018, DoD issued a proposed rule which would require covered contractors to complete Level I antiterrorism awareness training. It would create a new subpart in the DFARS to advise contracting officers of the training requirement, the authorized sources of training, and when training must be completed by contractors. This subpart also prescribes a new DFARS clause 252.204-7XXX, Antiterrorism Awareness Training for Contractors, for use in all solicitations and contracts, including those for the acquisition of commercial items, when contractor personnel will require routine physical access to a Federally-controlled facility or military installation. The new DFARS clause would also advise contractors of the training requirements, provide a reference to additional information and guidance available on the internet, and instruct contractors to include the clause in all subcontracts. (83 Fed. Reg. 42820, Aug. 24, 2018.)

DoD Issues Proposed Rule Clarifying Applicability of Buy American Exceptions to Photovoltaic Devices

On August 24, 2018, DoD issued a proposed rule to implement a FY 2018 NDAA provision that repeals the FY 2015 NDAA restrictions on the source of photovoltaic devices in contracts awarded by DoD that result in DoD ownership of photovoltaic devices by means other than DoD purchase of the photovoltaic devices as end products. The FY 2018 NDAA repealed Section 858 of the FY 2015 NDAA because that section did not specifically reference the Buy American statute. Consequently, the exceptions available under the Buy American statute did not automatically apply to photovoltaic devices provided under covered contracts. Reflecting this change, the proposed rule essentially reinstates the DFARS regulations as they existed prior to Section 858 of the FY 2015 NDAA except for certain minor residual provisions. (83 Fed. Reg. 42822, Aug. 24, 2018.)

DoD Issues Proposed Rule Regarding Performance-Based Payments

On August 24, 2018, DoD issued a proposed rule to implement a section of the National Defense Authorization Act for Fiscal Year 2017, which addresses the preference for performance-based payments, and to streamline the performance-based payment process. The proposed rule would also amend the DFARS to revise progress payments and performance-based payments policies for DoD contracts. These revisions would provide an opportunity for small entities to qualify for increased customary progress payment rates and maximum performance-based payment rates based on whether the offeror/contractor has met certain performance criteria. The proposed rule would also delete the current regulations relating to performance-based payments at DFARS Subpart 232.10 and the associated clauses at DFARS 252.232-7012, Performance-Based Payments—Whole Contract Basis, and DFARS 252.232-7013, Performance-Based Payments—Deliverable Item Basis. Under the proposed rule's new provisions, a customary progress payment rate of 50 percent would apply for other than small businesses, the 90 percent rate would apply for small businesses, and it provides criteria by which contractors can achieve a customary progress payment rate of up to 95 percent. (83 Fed. Reg. 42831, Aug. 24, 2018.)

DoD Issues Proposed Rule to Allow More Than Five Offerors on Two-Phase Design-Build Solicitations

On August 24, 2018, DoD issued a proposed rule to implement Section 823 of the National Defense Authorization Act for Fiscal Year 2018 (Pub. L. 115-91). Section 823 amended 10 U.S.C. § 2305a to allow for more than the maximum number of five offerors without submission of a justification to the head of the contracting activity when a solicitation is issued using two-phase design-build selection procedures for an indefinite-delivery, indefinite-quantity (IDIQ) contract that exceeds $4 million. The proposed rule implements Section 823 by adding a new DFARS section 236.303-1(a)(4), to be used in lieu of the procedures at FAR 36.303-1(a)(4), which would provide new authority to exceed the five-offeror maximum when the solicitation is for an IDIQ contract that exceeds $4 million and states that the number of offerors is at the contracting officer's discretion when the solicitation is for a contract that does not exceed $4 million. (83 Fed. Reg. 42850, Aug. 24, 2018.)

About Dentons

Dentons is the world's first polycentric global law firm. A top 20 firm on the Acritas 2015 Global Elite Brand Index, the Firm is committed to challenging the status quo in delivering consistent and uncompromising quality and value in new and inventive ways. Driven to provide clients a competitive edge, and connected to the communities where its clients want to do business, Dentons knows that understanding local cultures is crucial to successfully completing a deal, resolving a dispute or solving a business challenge. Now the world's largest law firm, Dentons' global team builds agile, tailored solutions to meet the local, national and global needs of private and public clients of any size in more than 125 locations serving 50-plus countries. www.dentons.com.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
Events from this Firm
18 Sep 2018, Other, Dubai, United Arab Emirates

In December 2017, FIDIC published new editions of the Red Book (Construction), the Yellow Book (Design and Build) and the Silver Book (Turn-key), the first re-write since 1999.

26 Sep 2018, Conference, New York, United States

Dentons is delighted to support a global IT services and consulting firm Miratech as an event host partner at their annual conference called M-Force18 New York on September 27th. The event will be held at Dentons New York office in the heart of Midtown Manhattan, opposite Rockefeller Center.

2 Oct 2018, Seminar, Dallas, United States

We are pleased to offer a program of five sessions designed specifically for in-house counsel. Topics will include:

  • In-house corporate ethical issues
  • What recent Supreme Court decisions mean for business
  • Keeping lawyers out of your benefit plans
  • Litigation tactics for in-house counsel
  • Employment issues in the age of #MeToo
Similar Articles
Relevancy Powered by MondaqAI
 
In association with
Related Topics
 
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
 
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions