Federal contractors will soon see new provisions concerning COVID-19 safety protocols included in most new and renewed Federal contracts. The following is a brief initial overview of what contractors should expect and when.
New Contract Clause and Guidance
On Sept. 9, in conjunction with the announcement of a multi-faceted COVID strategy, President Biden issued a new Executive Order to strengthen COVID-19 safety protocols for Federal contractors. This Executive Order directs Federal departments and agencies to include in their contracts a new clause that will require contractors to comply with guidance issued by the President’s Safer Federal Workforce Task Force. The Task Force was established on Jan. 20. The President directed the Task Force to issue new guidance by Sept. 24. This guidance will establish protocols required of contractors and subcontractors, as well as define the reach of the Executive Order and any exceptions to its implementation. Prior to any guidance taking effect, the Director of the Office of Management and Budget must determine that the proposed guidance will “promote economy and efficiency in Federal contracting.”
While the Executive Order will principally affect new contracts including contract extensions, option exercises, and renewals, agencies are being “strongly encouraged” to ensure that the safety protocols required by the Task Force are followed under existing contracts. It is unclear how agencies will implement this latter direction. Importantly, the Executive Order seeks to reach beyond Federal procurement contracts. The Executive Order uses the term “contract-like instruments,” a term drawn from the Department of Labor’s proposed rule, “Increasing the Minimum Wage for Federal Contractors,” issued at the direction of previous Executive Order 13658. As this proposed rule states, a contract-like instrument is intended to include both procurement and non-procurement contracts, including cooperative agreements but not grants.
New Contracting Regulations
Following the issuance of the Task Force’s new guidance, the FAR Council has been charged with publishing by Oct. 8, the implementing clause to be incorporated into new, renewed, and extended Federal procurement solicitations and contracts. Federal agencies are directed to exercise any applicable authority by Oct. 8, to ensure that contracts not subject to the FAR (i.e., non-procurement contracts) include a similar clause. Given the tight timeline for action, the initial expectation is that the FAR Council’s next steps will likely come in the form of an interim final regulation posted in the Federal Register that has near- or immediate-term effect, as has been the case with many other pandemic-related regulatory actions such as the recent emergency temporary COVID-19 standards issued by OSHA. The proposed regulation will go through a round of intra-governmental review at the Office of Information and Regulatory Affairs (“OIRA”) before being made final.
This Executive Order is just one step in a broad range of new actions by the Federal government in response to COVID-19, especially the impact of the Delta variant. While the Executive Order does not detail specific additions to the Task Force’s previous incorporation of the Agency Model Safety Principals, the Administration has made it clear that this Executive Order will result in broader and more expansive requirements. Prior to the Task Force releasing any further guidance as to which actions and requirements to be implemented, we do know this Executive Order will at least expand the Agency Model Safety Principals to off-site contractors and include all contracts, contract-like instruments, renewals, and extensions. The Agency Model Safety Principals currently include: