The General Services Administration (GSA) released its Class Deviation CD-2021-13 (the GSA Deviation), which, effective immediately, “provides instructions for the GSA acquisition workforce on when to include a new clause [i.e., Federal Acquisition Regulation (FAR) 52.223-99] (the Clause) in GSA solicitations and contracts and contract-like instruments.” Unlike the recent instructions and directions provided by the Civilian Agency Acquisition Council (CAAC) and the Department of Defense (DoD) and its DFARS Class Deviation (discussed in detail here), the GSA provided “GSA-specific implementation timelines for solicitations, new contracts, and existing contracts” to ensure that by October 8, 2021, all covered solicitations, new contracts, and existing contracts subject to Executive Order 14042, “Ensuring Adequate COVID Safety Protocols for Federal Contractors” (EO 14042), adhere to its mandates and the evolving guidance issued by the Safer Federal Task Force. This implementation includes the insertion of the Clause into new and existing GSA solicitations and Federal Supply Schedule (FSS) contracts awarded after October 15, 2021, and new contracts and leases awarded after November 14, 2021. The instruction applies broadly even to solicitations or contracts that have a value equal to or less than the simplified acquisition threshold (SAT) or are for the supply of products (either solely for products or for products and services). Moreover, the GSA is instructing its contracting officers to issue a letter to all existing contractors asking for their consent to a modification including the Clause. The end result is the expectation that virtually all GSA contracts and contract-like instruments will require all covered employees to be fully vaccinated by December 8, 2021. An analysis of the GSA Deviation’s key points, highlighting the confusion related to subcontract flow-downs, follows below.
As an initial matter, the GSA Deviation tracks the language of EO 14042 by requiring insertion of the Clause in its procurement vehicles:
- Contracts or contract-like instruments for services, construction, or a leasehold interest in real property exceeding the SAT or simplified lease acquisition threshold (SLAT)
- Contracts or contract-like instruments for services covered by the Service Contract Act, 41 U.S.C. § 6701, et seq., exceeding the SAT/SLAT
- Contracts or contract-like instruments for concessions, including any concessions contract excluded by Department of Labor regulations at 29 CFR § 4.133(b) exceeding the SAT/SLAT
- Contracts or contract-like instruments entered into with the Federal Government in connection with federal property or lands and related to offering services for federal employees, their dependents, or the general public, exceeding the SAT/SLAT
Going further, the GSA Deviation mandates application of the Clause to new solicitations and contracts (including all FSS contracts) with a value “equal to or less than the SAT/SLAT” and “solely for the manufacturing of products, unless exempted by [Federal Acquisition Service] or [Public Building Service] specific guidance.” For existing contracts (other than existing FSS contracts), however, the GSA Deviation provides a template letter for GSA contracting officers to use in “strongly encouraging” such contractors to accept the Clause through a bilateral modification.
Notably, the GSA does draw a line in providing that the Clause does not apply to (1) micropurchases, (2) site acquisition, (3) sales of surplus real and personal property, (4) solicitations and contracts if employees are performing work outside the United States or its outlying areas, and (5) contracts or subcontracts with Indian Tribes under the Indian Self Determination and Education Assistance Act (note, however, that a procurement contract or subcontract subject to the FAR and awarded to an Indian-owned or tribally owned business entity is not subject to the latter exclusion).
GSA’s Implementation Timelines
The GSA Deviation also provides specific timelines for implementation of the FAR contract clause deviation into new and existing GSA solicitations and new and existing GSA contracts:
- New Solicitations – GSA contracting officers must include the Clause in new covered solicitations—including solicitations for contracts whose value is equal to or less than the SAT/SLAT or solely for the manufacturing of products—issued on or after October 15, 2021.
- Existing Solicitations – The GSA Deviation directs GSA contracting officers to “either amend the solicitation to include the Clause . . . or incorporate it into the award of the apparent successful offeror for applicable solicitations that were issued prior to October 15, 2021, that have not closed, or awards that have not been made by October 15, 2021.” Note that “applicable solicitations” also include existing solicitations for contracts whose value is equal to or less than the SAT/SLAT or solely for the manufacturing of products.
- New Contracts – Similar to the guidance for new solicitations, GSA contracting officers must include the Clause in new applicable contracts—including contracts whose value is equal to or less than the SAT/SLAT or solely for the manufacturing of products—awarded on or after October 15, 2021.
- Existing Contracts – The GSA Deviation directs contracting officers to execute a bilateral modification (in the form of a template cover letter, as discussed below) for existing contracts “including indefinite delivery, indefinite quantity (IDIQ) contracts, and contract-like instruments.”
The Bilateral Modification Template
The GSA contracting officers must use the cover letter template, included as Attachment B to the GSA Deviation, as the means to request to enter into bilateral modifications for inclusion of the FAR contract clause deviation in existing contracts and contract-like instruments, and “complete as many modifications as possible by November 14, 2021.” Although GSA contracting officers are “ultimately responsible” for sending the cover letter modification request to contractors, GSA will also send the request to eligible contractors as part of a “central mass modification” update.
In pertinent part, the letter “strongly encourages” holders of a GSA contract for “services, construction, or a leasehold interest in property that exceeds the [SAT] or [SLAT],” to accept the modification by signing and returning the modification before November 14, 2021, noting that acceptance is mandatory before GSA “will renew, extend the period of performance of your contract, or exercise an option.” On the other hand, and as noted previously, the letter does not require but merely “strongly encourages” holders of contracts “at or below the SAT/SLAT or a contract only for products” (but not “solely for the manufacturing of products”) to accept the modification.
Modification acceptance is also mandatory for IDIQ contract holders, including holders of FSS contracts, as the cover letter cautions that IDIQ contract holders must sign the modification no later than November 14, 2021, to be eligible for new orders. Most notable about the GSA Deviation’s guidance, however, is the ability of GSA contracting officers to essentially “blacklist” IDIQ contract holders that fail to return the signed modification by November 14, 2021, by taking the interim remedial actions of “[t]emporarily hiding contractor information on GSA websites and/or e-tools” and/or “[f]lagging contractors that have not accepted the modification.”
Federal Acquisition Service (FAS) Guidance
The GSA Deviation makes clear that no matter the type of GSA contract held, contractors will be expected to comply with the new FAR provision. In particular, Attachment C to the GSA Deviation includes guidance specific to the FAS for implementing the FAR contract clause deviation in FAS contract vehicles (FAS Guidance).
As a general matter, the FAS Guidance states that FAS will bilaterally modify “all new applicable contracts and ‘contract-like instruments’ awarded on or after October 15, 2021,” and “all existing contracts and ‘contract-like instruments’ awarded on or after October 15, 2021,” to include FAR 52.223-99. FAS will use the automated mass modification process in FSS-19 to modify eligible contracts; otherwise, the cognizant GSA contracting officer will be responsible for ensuing covered contracts are appropriately modified. Specific guidance for the most common FAS contract vehicles is provided as follows, but FAS contract holders should review the FAS Guidance in detail:
- Federal Supply Schedule – FAS contracting officers must incorporate the FAR contract clause deviation into all new and existing FSS contracts above the micro-purchase threshold, including contracts that include products. Although the FAS Guidance notes that there is no mandate or encouragement to require incorporation of the Clause into contracts that are for products and services, the FAS Guidance states that “[i]t is not administratively feasible to distinguish FSS contracts that are solely for products from FSS contracts that are primarily for products but also include ancillary-type services (e.g., installation, maintenance, training, ancillary services acquired via the Order-Level Materials SIN, etc.). Requiring the Clause in all FSS contracts will simplify compliance tracking, vendor communication, and customer messaging efforts.”
- Blanket Purchase Agreements (BPAs) – Applicable orders issued through BPAs established under FAR Part 13 procedures must include the FAR contract clause deviation for all new and existing orders unless the Clause is already incorporated into the BPA. For applicable BPAs established under FAR Part 8 procedures, “the objective is to get the Clause into the Schedule contract as soon as possible.” However, FAS contracting officers have the discretion to bilaterally modify existing BPAs to incorporate the FAR contract clause deviation.
- Governmentwide Acquisition Contracts (GWACs), Multi-Agency Contracts (MACs), and Agency-Specific Indefinite Delivery Vehicle (IDV)/IDIQs – FAS contacting officers must incorporate the FAR contract clause deviation into all new and existing GWACs, MACs, and IDV/IDIQ contracts, including contracts that are solely for products. Similar to its reasoning underlying inclusion of the FAR contract clause deviation in FSS contracts solely for products, the FAS Guidance states that “[r]equiring the clause in all GWAC and MAC contracts will simplify compliance tracking, vendor communication, and customer messaging efforts.”
- Orders – Prior to placing orders on or after November 14, 2021, FAS contracting officers shall ensure that the FAR contract clause deviation has been incorporated into the underlying contract. If not, the cognizant contract officer must include the Clause in the solicitation and resultant order, as applicable. For existing orders against IDV/IDIQ contracts (g., FSS, GWACs, and MACs), if the underlying contract has not been modified to include the Clause or the underlying contract has expired, the order-level contracting officer shall bilaterally modify the order to include the FAR contract clause deviation prior to exercise of the option period or extension.
- Commercial Solutions Opening (CSO) – While this pilot program is not governed by the FAR, CSOs are considered “contract-like instruments” and are subject to the requirements of EO 14042 and the GSA Deviation. Therefore, FAS contracting officers must incorporate the FAR contract clause deviation into CSO contracts.
Public Buildings Service Guidance
Attachment D to the GSA Deviation includes guidance specific to the Public Buildings Service (PBS) for implementing the FAR contract clause deviation in PBS contract vehicles (PBS Guidance).
Beginning on or about October 8 and continuing through October 15, existing PBS contracts and contract-like instruments (stand-alone contracts, BPAs, BPA calls, IDIQs, task/delivery orders, and purchase orders) will be modified to include the FAR contract clause deviation via automated mass modification (i.e., the Bot) through GSA’s Electronic Acquisition System Integrated (EASi). Specifically, the Bot will create the cover letters and modifications to existing contracts and contract-like instruments in EASi and email them to the contractors, with a copy to the cognizant contracting officer. Contractors must sign the modification and return it to the contracting officer for finalization in EASi. For existing contracts and contract-like instruments not in EASi, the bilateral modification process will commence using the aforementioned cover letter template. Existing PBS solicitations for stand-alone contracts, BPAs, BPA calls, IDIQs, task/delivery orders, and purchase orders must be amended to include the FAR contract clause deviation; new solicitations issued on or after October 15, 2021, must include the Clause in the solicitation and resulting award.
Similar to modifications of existing PBS contracts and contract-like instruments, all existing PBS leases, regardless of dollar value, will be modified to include the FAR contract clause deviation via bilateral lease amendment issued through a mass modification. The PBS Office of Leasing will issue the lease amendments no later than October 15, 2021. Existing Request for Lease Proposals (RLPs) for leases awarded on or after October 15, 2021, as well as new RLPs issued on or after the same date must be amended to include the FAR contract clause deviation.
What About Subcontractors?
The application of the Clause to subcontracts and its flow-down requirements is where the GSA’s guidance (like that of the CAAC and the DOD) becomes cloudy. Paragraph (d) of the Clause restricts the flow-down of the Clause to subcontracts at any tier above the SAT threshold and to contracts for “services, including construction, performed in whole or in part within the United States or its outlying areas.” Although the GSA Deviation provides that GSA is “strongly encouraging” that the Clause be used in subcontracts below the SAT/SLAT and solely for the manufacturing of products, it does not attempt to amend the Clause to broaden the flow-down requirement. Accordingly, GSA prime contractors appear to be under no compunction to flow down the Clause to the broader group of contracts that fall within the net of the GSA Deviation. This puts prime contractors in the potentially troubling position of determining whether they should go beyond the language of the Clause and flow it down to otherwise excluded subcontracts based on the strong encouragement of the GSA. Similarly, subcontractors are also in the difficult position of deciding whether to push back if the Clause is “wrongly” included.
The GSA Deviation presents the most detailed and contract-type-specific agency guidance issued so far, and GSA contractors are, for lack of a better term, “strongly encouraged” to closely analyze the applicable implementation procedures and timelines to ensure compliance. At bottom, it’s now clear that nearly all federal government contractors and subcontractors must quickly consider how they will comply with the COVID-19 safety and vaccination requirements. With compressed agency timelines for implementation of contract clause deviations in new and existing solicitations and contracts, failing to plan accordingly may potentially result in being rendered ineligible for federal contracting work.