Federal Procurement Regulatory Council Expands Federal Contractor’s Mandate on COVID-19 Vaccine | Seyfarth Shaw LLP
On Friday October 1, 2021, a full week before the October 8 deadline, the Federal Acquisition Regulatory Council (“FAR Council” or “Council”) issued a Contractual exemption clause from federal procurement regulations (“FAR”) which must be inserted in covered federal contracts. A “deviation” is a procedure for guiding action during the federal acquisition process that is either incompatible with existing FAR rules or not yet defined as a permanent FAR rule. These guidelines and clauses relate to the safety of federal COVID-19 contractors, as required by Executive Decree 14042, “Ensuring Adequate COVID Security Protocols for Federal Contractors” (“EO 14042” or “EO”).
Rather than issuing a deviation or interim rule indicating when the clause (“clause”) is to be inserted in Covered Federal Contracts, the FAR Council has delegated this responsibility to each individual Covered Agency to develop and implement its own. class deviation. In addition, the Council – aligned with the broad September 24, 2021 working group on federal workforce security Advice (“Task Force Guidance”) – recommended to include the clause in contracts beyond the scope of OE 14042 (including supply contracts and contracts below the simplified acquisition threshold (” SAT ”) of $ 250,000). Each civil agency will provide variances and must have their class deviations approved by the General Services Administration.
Once inserted into a contract, the clause – FAR 52.223-99 – will require contractors to comply with the guidelines of the September 24 working group for the vaccinations of federal contractors (as well as future changes to the guidelines). The FAR Council has indicated that it will begin the process of developing permanent rules, engaging in the notice and comment process to issue a final rule. However, there is no deadline set for this endeavor and will not delay the current implementation plan and schedule. The FAR Council could issue a rule proposal within days, or could wait an extended period to assess how cases falling under the class waiver (s) play out.
The FAR Council referred to Articles 5 and 6 of the EO stating that:
agencies are required to include an execution clause in calls for tenders and service contracts, including construction in accordance with the following dates specified in article 6 of the decree:
- new contracts awarded on or after November 14 from invitations to tender issued before October 15 (this includes new orders awarded on or after November 14 from invitations to tender issued before October 15 under contracts with indefinite delivery existing);
- new solicitations issued on or after October 15 and contracts awarded in accordance with such solicitations (this includes new solicitations issued on or after October 15 for orders awarded in accordance with these solicitations under existing indefinite delivery contracts);
- extensions or renewals of existing contracts and orders placed as of October 15, 2021; and
- options on existing contracts and orders exercised from October 15, 2021.
On the same day, Friday October 1, 2021, both GSA, the Department of Defense (DoD), and the Virginia published their class differences. These agencies seem to ignore the decree by authorizing (or in some cases requiring) the addition of the clause for main supply contracts. The clause itself, however, still seems to exclude subcontracts for the supply, although it is not clear now whether a contract primarily for the supply that includes a small amount of services would need the clause. The VA class deviation generally follows the requirements and recommendations of the Council, but the DoD and GSA deviations have additional nuances.
The DoD class gap requires inclusion of the clause in all contracts that have been specified by OE 14042 (with the notable exception of leasehold interests on real estate, which have been included in the OE). The DoD Gap permit contracting officers to include the clause in the following additional contracts that have been omitted or expressly excluded by the IB:
- Calls for tenders issued before until October 15, 2021;
- Contracts, task orders or delivery notes awarded before November 14, 2021, resulting from invitations to tender issued before October 15, 2021;
- The requests, contracts, task orders and delivery slips that are rated at or below the SAT and relate to services (including construction) performed in whole or in part in the United States and its peripheral regions; Where
- The requests, contracts, task orders and delivery slips for the manufacture of some products.
The DoD’s class deviation effectively gives hundreds of contracting officers the discretion to insert the vaccination clause into virtually any type of contract (apparently except leases), including those that are not. not included in OE. For DoD contractors and other government contractors whose contracts primarily involve the supply of products, this broad clearance is alarming.
The GSA class deviation is much more detailed and has different guidelines for different types of contracts. This requires inclusion of the clause in all types of contracts required by the IB (including leases). The GSA gap strongly encourages contracting officers to include the clause in all other contracts or subcontracts, including those falling under the SAT and for supplies. When it comes to supplies, there are very specific guidelines that apply to GSA Federal Procurement Programs (“FSS”), General Purchasing Agreements (“BPA”), Multi-Agency Contracts ( “MAC”), government-wide procurement contracts (“GWAC” “), agency-specific indefinite delivery vehicle contracts (” IDV “), and indefinite delivery indefinite quantity contracts ( “IDIQ”). For FSS and BPA, GSA requires inclusion of the clause, even in supply contracts. For GWAC, MAC and IDV / IDIQ contracts, GSA requires inclusion of the clause in contracts only for supplies, except in a few types of limited contracts (eg non-FSS automobile), where it will only be strongly encouraged.
The GSA class deviation explicitly stop inclusion of the Clause in contracts:
- Below the micro-purchase threshold ($ 10,000);
- For the acquisition of sites;
- Regarding sales of surplus real and personal property;
- Regarding solicitations and contracts if the performance is outside the United States or its peripheral regions (the exclusion is limited to employees who perform work only outside the United States or its peripheral regions); Where
- With Indian tribes under the Indian Self-Determination and Aid for Education Act (Public Law 93-638) (the exclusion would not apply to a supply or subcontracting contract in under the FAR to a commercial entity owned by Indians or tribes.
As for subcontracts, the clause remains fairly consistent with the IB, but for subcontracts which are a mixture of supplies and services, it is not known at what point a supply contract would actually be considered as a supply contract. services. As a result, sub-contractors will be largely subject to whatever their prime contractor chooses to do with respect to the application of the vaccine clause. As a result, subcontractors will want to contact the prime contractors to understand and possibly negotiate how to proceed.
The FAR, GSA, and DoD class deviations include relevant time frames for their requirements to come into effect, including dates on which contracts are to be amended. For the GSA class deviation, the requirements are particularly detailed and specific to the type of contract. More agencies are expected to issue class gaps throughout the week, and it appears that agencies are paying little attention to OE boundaries, but instead pushing for the mandate of EO. vaccine is included in as many contracts as possible; the FAR Council has explicitly declared “the objective of vaccinating more people and reducing[ing] the spread of COVID-19. We expect to see legal challenges and setbacks against the agencies this week based on inconsistencies with the OE. If this happens, we might see an EO modification to reconcile conflicting terms and reduce the chances of a successful court challenge.
We recommend that you contact your Seyfarth lawyer to discuss the relevant time frames, contract specific nuances of the GSA class gap, and any other concerns. As you can see, this is a complicated analysis and process. You can also view our revised version Vaccines playbook, and contact your Seyfarth lawyer with any questions. The Playbook is an organic document that provides valuable information to employers who are considering implementing, or who are now required to impose, vaccination mandates.