Office Closures And Limited Access: Federal Contractor Considerations When Weathering Potential Political Unrest

McCarter & English Blog: Government Contracts & Export Controls

As has been widely reported, the United States Federal Bureau of Investigation is warning of mass protests and potential violence accompanying the inauguration of President-Elect Joe Biden on January 20, 2021. However, unlike the tragic events of January 6, 2021, at the U.S. Capitol, this warning is being directed to the capitols of all fifty states in addition to numerous assets located throughout the National Capitol Region. In light of these developments, federal contractors who find their operations close to these seats of power may have concerns as to whether to stay open or close their offices and keep employees away. Accordingly, we provide a timely reminder of key considerations that contractors should take into account when balancing the practical reality of safety concerns against the legal obligations of contractual compliance.

Multiple Federal Acquisition Regulation (FAR) clauses function to address the impacts contractors may face over the course of the next week. Most notably, the excusable delay provisions codified at FAR 52.249‑14 and FAR 52.212-4(f) provide relief for delays beyond the control and without the fault or negligence of any contractor, including, in pertinent part, “acts … of the public enemy” and “acts of the Government in its sovereign capacity.” If the facts on the ground give rise to such delays, contractors may be permitted to avail themselves of an adjustment to the contract schedule to account for the delay(s) experienced. Importantly, contractors should remember that excusable delay clauses do not provide a mechanism for contractual recovery of increased costs relating to the delays. But all hope is not lost. Excess costs – which fall into a variety of direct and indirect categories – may be recoverable through (a) the equitable adjustment processes distilled in various changes clauses (e.g., FAR 52.243-1) or (b) the claims process prescribed in the applicable disputes clause (e.g., FAR 52.233-1).

While large cities like Washington, D.C., may be somewhat used to street closures and city lockdowns occasioned by protests and heightened police activity, many areas impacted by the FBI’s warning may not be so readily prepared. Accordingly, with law enforcement now firmly engaged and the likely presence of tens of thousands of National Guard troops spread across multiple cities, access to contractor offices and/or to government work sites may be severely restricted on January 20.

In light of the foregoing, if a contractor is intending to close its facility or if it expects that its employees will be unable to attend work at a government office, it should inform cognizant contracting officers immediately and in writing. Contractors should also carefully document (i) any decision to close offices or to otherwise keep employees home, and (ii) the contractual cost impacts arising from all such decisions. That communication should:

  • Reference the appropriate delay clauses in the affected contracts;
  • Explain the reason for the closing or expected obstruction, perhaps citing to the Government communications regarding potential unrest on Inauguration Day;
  • Indicate that the contractor reserves the right to submit appropriate requests for schedule extensions or similar adjustments after the cause of the delay has passed; and
  • Respectfully request that the Contracting Officer acknowledge receipt of the communication.

In light of the events of the past few weeks, it will be imperative that any communication addressing impacts to contract performance in the possible presence of political unrest be clear, patient, contractually grounded, and strictly apolitical. The focus should be employee health and safety, along with plans for a quick return to business as usual as soon as normal working conditions resume.

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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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