Weekly Update for Government Contractors and Commercial Businesses – March 2021 #2

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BUSINESS & TRANSACTIONS

PilieroMazza’s M&A Team Advises Senture in Its Sale to Kingswood Capital, March 3, 2021
PilieroMazza is pleased to announce the successful sale of our client Senture, LLC—a leader in large-scale, complex, multi-channel contact center and knowledge management solutions for commercial clients, government agencies, and systems integrators—to private equity group Kingswood Capital Management. Senture’s combination of flexible technology, proprietary training, dedicated staff, and speedy response to the COVID-19 pandemic enabled it to further accelerate its significant growth trajectory in recent years and throughout the course of 2020. “PilieroMazza’s team did an excellent job guiding us through a complex process,” said Chris Deaton, Former Owner and Retiring CEO of Senture. “Kathryn and her team really understood our goals and executed a well-planned transaction.” Read more here.

CYBERSECURITY & DATA PRIVACY

Jon Williams Features on SYNNEX-Sponsored CMMC Panel, March 3, 2021
Jon Williams, Partner in PilieroMazza’s Government Contracts and Cybersecurity & Data Privacy groups, was recently a featured speaker on SYNNEX’s webinar titled “Practical Asset Inventory Considerations To Get Ready For Cyber Security Maturity Model (CMMC) Certification.” Jon spoke alongside Michelle Chapin, SYNNEX’s Director of Public Sector Partner Business Development; Randy Finley, SYNNEX’s Director of Business Development; and Mike Raymond, Federal Sales Manager at Ordr. Taking place on March 2, 2021, their discussion covered practical asset inventory considerations businesses should implement to prepare for CMMC. Read more here.

Virginia Governor Signs Nation’s Second State Consumer Privacy Bill
The Washington Post reported that Governor Ralph Northam signed data privacy legislation into law, making Virginia the second state in the nation to adopt its own data protection rules. The law, known as the Consumer Data Protection Act (CDPA), will allow Virginia residents to opt out of having their data collected and sold and see what data companies have collected about them, correct the data, or delete the data. The CDPA becomes effective on January 1, 2023. Read more here. Read the text of the CDPA here.

NSA Releases Zero Trust Guidance
The National Security Agency (NSA) released guidance regarding the Zero Trust security model. The guidance explains the Zero Trust security model, its benefits, how it is implemented, and provides instruction on how defense agencies and contractors can set up a Zero Trust network architecture. NSA recommends that National Security Systems, Department of Defense networks, and Defense Industrial base systems all consider implementing a Zero Trust security model. To adopt a zero-trust cybersecurity mindset, NSA says that a dynamic threat environment requires the following:

  • Coordinated and aggressive system monitoring, system management, and defensive operations capabilities;
  • Assuming all requests for critical resources and all network traffic may be malicious;
  • Assuming all devices and infrastructure may be compromised;
  • Accepting that all access approvals to critical resources incur risk and being prepared to perform rapid damage assessment, control, and recovery operations.

Read more here.

GOVERNMENT CONTRACTS

Senate Approves Sweeping Coronavirus Measure
The Hill reported that the Senate passed a sweeping coronavirus relief bill over the weekend, which provides another round of stimulus checks, aid for state and local governments, and more help for small businesses and schools. The bill needs to be passed by the House and then signed by President Biden to go into effect. Read more here. A guide on funding allocation is available from the New York Times here.

MAS Catalog Migration by March 31, 2021 and Overall Catalog Compliance
The General Services Administration (GSA) published a reminder that, to be in full compliance with the Multiple Award Schedule (MAS) Consolidation Mass Mod A812, all contractors must complete two important steps by March 31, 2021: updating their catalog in GSA Advantage and updating their Price List. Read more here.

DHA Set to Take Over All Military Hospitals by End of 2021
Federal News Network reported that, after a tumultuous year of pauses and reconsiderations, military hospitals and clinics are still on track to move under the management of the Defense Health Agency (DHA) by the end of 2021. The transition includes 721 military treatment facilities and 174,000 healthcare personnel including active-duty service members, civilian employees, and contractors. Federal News Network further reported that Congress initiated the transition as part of the 2017 National Defense Authorization Act to better integrate healthcare rather than continue to have each military service oversee its own military treatment facilities. Read more here.

Defense Innovation Unit Publishes 2020 Report
The Defense Innovation Unit (DIU) published its 2020 annual report, which highlighted the agency’s 2020 accomplishments as well as the milestones DIU reached since its creation in 2015. Since its launch in 2015, the agency has issued 208 other transactions (OTs). In 2020 alone, it issued 56 prototype OTs, and about 40 percent of the agency’s contracts led to at least one prototype that made it to production. DIU works with startups, established companies, venture capital firms, investors, and traditional defense contractors to deliver commercial technology to the Department of Defense, provide fundamental sources of dual-use technologies, and serve as the foundation of the U.S.’s national security innovation base. Read more here.

Upcoming Government Contracts Presentations

WEBINAR: Exit Strategies for GOVCONs with Set Aside Contracts: 2021 Insights and Lessons Learned from Business Owners and Advisors, March 17, 2021, Cy Alba. Read more here.

WEBINAR: May the Clause Be with You: Certification/Information Regarding Responsibility Matters, March 23, 2021, Cy Alba and Katherine Burrows. Read more here.

WEBINAR: Navigation the FAR/DFARS: The Most Confusing and Little Known Clauses, April 26, 2021, Tim Valley and Christine Fries. Read more here.

LABOR & EMPLOYMENT

Changes to Pay Equity Law Are Coming: It’s Time to Consider Auditing Your Pay Practices, March 2, 2021, Nichole Atallah, Sarah Nash, and Sara Nasseri
Amidst all of the promises and actions taken by the Biden Administration, the topic of pay equity is gaining more and more attention. While there has been growing momentum on the issue for years now, the Biden Administration is making it clear that that momentum will materialize into actual changes in the law on the federal front. As such, it is critical that commercial businesses and federal contractors take proactive measures now, including conducting proactive pay analyses with legal counsel, in an effort to prepare for the changing landscape on pay equity. Read more here.

OMB Publishes Memoranda Reversing Policies under Executive Order 13950
The Acting Director of the Executive Office of the President, Office of Management and Budget (OMB) issued a memorandum providing detailed instructions for agencies to use to ensure there is a complete rollback of agency actions that were taken pursuant to Executive Order 13950, Combating Race and Sex Stereotyping. Executive Order 13950—which had restricted the availability of workplace diversity training and programs for federal employees and government contractors as well as the use of federal grants for those purposes—was signed by President Trump and revoked by President Biden through Executive Order 13985 on January 20, 2021. OMB’s memorandum further rescinds prior OMB memoranda and instructs agencies to take all appropriate actions to reverse agency actions that implemented the now-rescinded OMB policy memoranda. Read more here.

DOL Delays Effective Date of Independent Contractor Rule
The Department of Labor (DOL) published a final rule / delay of effective date. Consistent with the presidential directive expressed in the memorandum of January 20, 2021, titled “Regulatory Freeze Pending Review,” the action finalizes DOL’s proposal to delay the effective date of the rule titled “Independent Contractor Status Under the Fair Labor Standards Act,” until May 7, 2021. The rule was originally published in the Federal Register on January 7, 2021. Read more here.

Misclassified Workers Receive Back Pay After Investigation
The Department of Labor announced that the U.S. District Court for the Western District of Pennsylvania in Pittsburgh issued a consent order requiring a Pittsburgh home healthcare agency to pay more than $1.6 million in back wages and damages to 546 home health aides after it misclassified the health aides as independent contractors and failed to pay required overtime wages in violation of the Fair Labor Standards Act. Read more here.

Overtime Enforcement Recovers $2.1 Million for Home Healthcare Workers
The Department of Labor announced that its Wage and Hour Division (WHD) recovered more than $2.1 million in back wages for 456 workers employed by a Philadelphia home healthcare agency. WHD found that the employer paid family care workers on an hourly basis but paid straight-time rates for overtime hours. The employer also failed to record the number of hours that two employees worked and failed to record hourly rates, which violated Fair Labor Standards Act recordkeeping requirements. Read more here.

Upcoming Labor & Employment Presentations

WEBINAR: Staying SCA Compliant in a COVID-19 Environment, March 11, 2021, Nichole Atallah. Read more here.

LITIGATION & DISPUTE RESOLUTION

Medical Equipment Corporation Sentenced for $10 Million Healthcare Fraud Scheme
The Department of Justice announced that a North Carolina corporation was sentenced to five years’ probation and ordered to pay a $2 million fine in addition to paying more than $10 million in restitution to the North Carolina Medicaid Program on a charge of healthcare fraud. The company and its owner also agreed to pay millions to the U.S. and the State of North Carolina to resolve related civil claims under the federal and state False Claims Acts. In that same civil action, the governments obtained a multi-million-dollar judgment against one of the company’s employees. Read more here.

SAP Public Services, Inc. to Pay $2.2 Million to Settle False Claims Act Allegations
The Department of Justice reported that Deputy U.S. Attorney Louis Lappen announced that SAP Public Services, Inc. agreed to pay the U.S. more than $2.2 million to resolve allegations that it violated the False Claims Act by failing to pay required fees on contracts it signed pursuant to agreements with the General Services Administration. Read more here.

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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