Government Procurement: September and October 2013 Federal Register Update

by Sheppard Mullin Richter & Hampton LLP

1. Final Rules Regarding the Affirmative Action and Nondiscrimination Obligations of Contractors and Subcontractors

On September 24, 2013, the Department of Labor Office of Federal Contract Compliance Programs (“OFCCP”) published a final rule revising the implementing regulations of the Vietnam Era Veterans’ Readjustment Assistance Act of 1974, as amended by the Jobs for Veterans Act of 2002, (“VEVRAA”). OFCCP is responsible for enforcement of VEVRAA, which prohibits employment discrimination against protected veterans by covered Federal contractors and subcontractors. VEVRAA also requires each covered Federal contractor and subcontractor to take affirmative action to employ and advance the employment of these veterans. The final rule strengthens several provisions that are intended to aid in recruitment and hiring efforts, such as clarifying the mandatory job listing requirements, requiring data collection pertaining to protected veteran applicants and hires, and establishing hiring benchmarks to assist in measuring the effectiveness of the affirmative action efforts. 78 Fed. Reg. 58,614 (Sept. 23, 2013).

Separately, OFCCP published related revisions to the regulations implementing the non-discrimination and affirmative action regulations of section 503 of the Rehabilitation Act of 1973, as amended. Section 503 prohibits discrimination by covered federal contractors and subcontractors against individuals on the basis of disability, and requires affirmative action on behalf of qualified individuals with disabilities. The final rule strengthened the affirmative action provisions by, among other things, requiring data collection pertaining to applicants and hires with disabilities, and establishing a utilization goal for individuals with disabilities to assist in measuring the effectiveness of the contractor’s affirmative action efforts. To implement changes mandated by the ADA Amendments Act of 2008, the final rule also adopted revisions to the definitions and to the nondiscrimination provisions of the implementing regulations. 78 Fed. Reg. 58,682 (Sept. 24, 2013).

2. Proposed Rule to Further Implement the Trafficking in Persons Policy

On September 26, 2012, the Department of Defense (“DOD”) proposed to amend the Defense Federal Acquisition Regulation Supplement (“DFARS”) to further implement the DOD trafficking in persons policy and to supplement government-wide changes proposed in connection with the Executive Order titled Strengthening Protections Against Trafficking in Persons in Federal Contracts, to improve awareness, compliance, and enforcement. Comments to the proposed rule should be submitted on or before November 25, 2013 to be considered in the formation of the final rule. 78 Fed. Reg. 59,325 (Sept. 26, 2013).

3. Interim Rules Regarding Allowability of Legal Costs for Whistleblower Proceedings

On September 30, 2013, DOD issued interim rules amending the DFARS to implement statutory amendments to whistleblower protections for contractor and subcontractor employees and to implement a section of the National Defense Authorization Act (“NDAA”) for Fiscal Year (“FY”) 2013 that amends the allowability of legal costs incurred by a contractor related to whistleblower proceedings. Comments on the interim rules should be submitted on or before November 29, 2013 to be considered in the formation of the final rules. 78 Fed. Reg. 59,851 (Sept. 30, 2013); 78 Fed. Reg. 59,860 (Sept. 30, 2013).

Separately, the DOD, General Services Administration (“GSA”), and National Aeronautics and Space Administration (“NASA”) issued an interim rule amending the Federal Acquisition Regulation (FAR) to implement a section of the NDAA for FY 2013 that addresses the allowability of legal costs incurred by a contractor or subcontractor related to a whistleblower proceeding commenced by the submission of a complaint of reprisal by the contractor or subcontractor employee. Comments must be submitted by November 29, 2013 to be considered in the formation of the final rule. 78 Fed. Reg. 60,173 (Sept. 30, 2013).

The DOD, GSA, and NASA issued a related interim rule amending the FAR to implement a pilot program enhancing whistleblower protections for contractor employees. Here again, comments are due by November 29, 2013 to be considered in the formation of the final rule. 78 Fed. Reg. 60,169 (Sept. 30, 2013).

4. Interim Rule Regarding Acquisitions in Support of Operations in Afghanistan

On September 30, 2013, the DOD issued an interim rule amending the DFARS to implement two sections of the NDAA for FY 2013 that require compliance with domestic source restrictions in the case of any textile components supplied by DOD to the Afghan National Army or the Afghan National Police for purposes of production of uniforms, and eliminate the application of the enhanced authority to acquire products and services from Iraq. Comments on the interim rule should be submitted by November 29, 2013 to be considered in the formation of the final rule. 78 Fed. Reg. 59,854 (Sept. 30, 2013).

5. Interim Final Rule Regarding Service-Disabled Veteran-Owned and Veteran-Owned Small Business Status Protests

On September 30, 2012, the Department of Veterans Affairs (VA) published an interim final rule amending its adjudication procedures for Service-Disabled Veteran-Owned Small Businesses (“SDVOSB”) and Veteran-Owned Small Businesses (“VOSB”) status protests, to provide that VA’s Director, Center for Veterans Enterprise (“CVE”), shall initially adjudicate SDVOSB and VOSB status protests, and to provide that protested businesses, if they are denied status, may appeal to VA’s Executive Director, Office of Small and Disadvantaged Business Utilization. Additionally, VA amended the title of CVE from the Center for Veterans Enterprise to the Center for Verification and Evaluation, to more appropriately represent the function of this office. 78 Fed. Red. 59,861 (Sept. 30, 2013). Comments must be received on or before November 29, 2013.

6. Final Rule on Task and Delivery Order Contracts, Bundling, Consolidation

On October 2, 2013, the Small Business Administration (“SBA”) amended its regulations to establish policies and procedures for setting aside, partially setting aside, and reserving Multiple Award Contracts for small business concerns. SBA also established policies and procedures for setting aside task and delivery orders for small business concerns under Multiple Award Contracts. In addition, SBA addressed how it would determine size under certain Agreements and when recertification of status would be required. Finally, SBA established a new definition of “consolidation” and reorganized its prime contracting assistance regulations.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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