DOL Seeks Approval of New Approach for Monitoring Construction Contractor Compliance with Affirmative Action RequirementsThe Department of Labor’s Office of Federal Contract Compliance Program (OFCCP) recently requested approval from the Office of Management and Budget (OMB) of a new approach to review federal construction contractors’ compliance with OFCCP’s Affirmative Action Program (AAP) and record-keeping requirements (view a copy of the supporting statement for the request). OFCCP hopes to employ less burdensome compliance checks in greater quantity as opposed to more intensive compliance reviews or audits. In addition, OFCCP plans to harmonize the procedures by which compliance checks are conducted.

For federal contractors who satisfy the jurisdictional thresholds, OFCCP is charged with administering and enforcing three equal employment opportunity laws: Executive Order 11246, Section 503 of the Rehabilitation Act of 1973, and the Vietnam Era Veterans’ Readjustment Assistance Act of 1974 (VEVRAA). These laws are designed to prevent discrimination on the basis of race, color, religion, sex, sexual orientation, gender identity, natural origin, and disability, and to prevent discrimination against protected veterans, including disabled, recently separated, and active duty veterans. The laws also require federal contractors to implement affirmative action programs for marginalized groups, disabled individuals, and veterans, and to avoid retaliatory actions against employees for discussing salary or pay.

Currently, under 41 CFR §§ 60-1.20, 60-300.60, and 60-741.60, OFCCP may conduct compliance evaluations that consist of one or any combination of investigative procedures, including a compliance review, an off-site review of records, a compliance check, and/or a focused review. Federal construction contractors are currently subject to compliance reviews that are lengthier and more involved than compliance checks. If OFCCP’s proposal is approved, future compliance check notices to contractors will likely request the following:

  • Personnel records that list construction trade employment activity (applicants, hires, promotions, layoffs, recalls, voluntary terminations, and involuntary terminations), including the name, job classification, gender, race and/or ethnic designation for each employee or applicant (41 CFR § 60-1.12(a) and (c))
  • Payroll records for all construction trade employees working in the Standard Metropolitan Statistical Area(s) (SMSA) or in the Economic Area(s) (EA) during the specified review period, submitted by project, including each employee’s name or ID, gender, race/ethnicity, hire date, trade(s), total hours worked in each trade, overtime hours worked in each trade, wage rate(s) for each trade, apprenticeship status, and employment type (e.g., full-time, part-time, temporary, contract, per diem, day labor)
  • Examples of job advertisements and postings
  • Documentation of accommodation requests received and their resolution, if any
  • A copy of the current Section 503 AAP
  • A copy of the current VEVRAA AAP
  • Documentation of the data collection analysis
  • Documentation of the most recently adopted VEVRAA hiring benchmark

For federal construction contractors impacted by these potential changes, now may be a good time to start re-evaluating your compliance and record-keeping procedures related to AAPs. While OFCCP anticipates that the new compliance check approach will reduce the burden on contractors, contractors will likely need some time to adjust to the new protocols, especially as it pertains to records described above and related programs. Also, because OFCCP anticipates being able to conduct more compliance checks (approximately 500 annually), contractors may be subject to oversight more often, and it may make sense to update or modify existing AAP compliance regimes to accommodate the changing landscape.

If you have questions about your compliance program or what the OFCCP’s proposal means for your business, please feel free to contact Aron Beezley or Aman Kahlon.

The General Services Administration (GSA) recently announced that, “[d]ue to corrective action being taken in response to a U.S. Court of Federal Claims protest, the government has rescinded all contract awards made in response to solicitation no. QTA0016GBA0002,” which is for the Alliant 2 Small Business Governmentwide Acquisition Contract.

What happened?

GSA Rescinds All Alliant 2 Small Business Awards in Response to ProtestThe subject solicitation, which was originally issued in June 2016 and contained a total ceiling of $15 billion, sought proposals for the Alliant 2 Small Business Governmentwide Acquisition Contract, a multiple-award, indefinite-delivery, indefinite-quantify contract, for information technology services.

In February 2018, the GSA awarded contracts to 81 different small businesses under the solicitation.

Thereafter, more than 15 disappointed offerors filed bid protests with the Government Accountability Office (GAO), challenging various aspects of the GSA’s evaluation and awards (B-415789, et al.).

During the pendency of the GAO protests, however, one of the disappointed offerors filed a separate bid protest at the U.S. Court of Federal Claims (COFC). This COFC protest divested the GAO of jurisdiction over the pending protests, and the GAO thus dismissed the pending protests in May 2018.

One of the original GAO protesters, Citizant, Inc. (Citizant), then filed its own protest with the COFC in June 2018, alleging a series of errors associated with the evaluation of more than 20 awardees. Approximately nine months later, in March 2019, the COFC found in favor of Citizant, agreeing that the contracting officer acted arbitrarily by crediting certain offerors with points for proposing an adequate Cost Accounting System (CAS) and by failing to rationally evaluate certain offerors’ proposed pricing.

As a result, the COFC enjoined “the GSA from proceeding with the current awardee list” and directed “the GSA to reevaluate the proposals in a manner that redresses the errors” discussed in the COFC’s decision.

In response to the Citizant COFC decision, the GSA announced on March 26, 2019, that it “has rescinded all contract awards made” under the Alliant 2 Small Business solicitation, “returning to a pre-award status.”

What does this mean for Alliant 2 Small Business offerors?

According to the GSA’s March 26, 2019, announcement, which was posted on www.fbo.gov, “[p]roposal evaluation will continue and a new source selection decision is expected at a point to be determined.”

The GSA’s announcement further states that “[s]olicitation number QTA0016GBA0002 on www.fbo.gov remains the official location for solicitation information – please continue to monitor it for updates.”

Finally, the announcement states that “GSA understands that you might have questions and those can be sent to a2sb@gsa.gov, which might be addressed in a question and response release to all parties on FBO.”

Please feel free to contact Aron Beezley or Sarah Osborne if you have any questions about this noteworthy development.

Contractor May be Liable for Injury Caused by Work Installed According to Customer SpecificationsAn Illinois appellate court recently addressed the scope of negligence liability for a slip and fall injury on a newly installed roof at the Chicago White Sox Stadium. In 2013, a maintenance employee slipped on the roof at the stadium and suffered severe muscle tears. The employee filed suit alleging negligence and strict liability against the White Sox, the roofing contractor, and the manufacturer of the roofing product. All three defendants moved for and were granted summary judgment by the trial court, and the employee appealed.

On appeal, the manufacturer argued that it owed no duty of care to the employee and, regardless, had provided sufficient warning to its immediate vendee, the contractor, so as to relieve the manufacturer of any liability. The contractor argued that it owed no duty of care to the plaintiff because it relied on the customer’s specifications and performed the work in accordance with the specifications.

After reviewing the manufacturer warnings, the appellate court agreed that the manufacturer had provided adequate warnings to the contractor regarding use of its roofing product and affirmed summary judgment in favor of the manufacturer. However, the appellate court reversed the trial court’s grant of summary judgment with respect to the White Sox and the contractor. Although the contractor cited past Illinois rulings that relieved contractors from liability to third parties when contractors followed the plans, specifications and instructions provided by an owner, the appellate court here found that the contractor still owed a duty of care to third parties. The court reasoned that, because the White Sox sought the contractor’s “expertise, advice, and direction” to make recommendations regarding roofing materials and necessary safety equipment, the contractor was not just “blindly replicat[ing]” specifications and plans.

The court was particularly persuaded by evidence that the White Sox and contractor negotiated the contract over several iterations and meetings. Unlike a traditional design-bid-build work scenario, the contractor had input on the specifications, plans and materials to be used in the construction of the roof, not unlike a design-build project.

The court’s decision places the contractor in a precarious position, where it may be held accountable for an injury to a third party, despite following its customer’s plans and specifications. Contractors, especially those involved in negotiated private work and, in particular, those performing construction manager roles with input into design and constructability decisions, should be mindful of the Illinois court’s decision and the implications the decision may have on future claims.  A careful contractor can do several things to mitigate the risk of liability to third-party plaintiffs such as the White Sox employee in this case:

  1. pass on any manufacturer warnings explicitly to the owner;
  2. expressly disclaim liability for defective specifications or plans and seek indemnity from the owner for the same; and
  3. evaluate, during negotiations, the potential unintended consequences of recommending different materials, equipment or systems, especially if the recommended alternatives are to satisfy a demanding customer’s price concerns.

Additionally, contractors should ensure their applicable insurance policies cover such third-party injuries. If you have any questions about this case or subject matter, please contact Aman Kahlon.