Potential Government Shutdown – What Every Federal Contractor Needs to Know

Source: Proskauer

We appear to be on the precipice of another federal government shutdown. Absent a political compromise, the federal government’s funding will run out on September 30, 2023. During previous government shutdowns, government agencies and departments issued stop-work orders, grinding work on government projects and contracts to a halt. Contractors were then faced with the difficult task of remaining in compliance with their obligations to their employees while work and funding for those contracts has ceased.

With a possible shutdown on the horizon, contractors are beginning to consider how to handle these complex employment issues. Although the discussion below is not intended to be comprehensive, it discusses many of the significant employment-related issues a shutdown presents for contractors.

Wage and Hour Considerations

During a shutdown, non-essential government employees are typically furloughed, and many contractors implement furlough programs for their own employees. Contractors must remain mindful of obligations under both federal and state wage and hour laws when placing employees on furlough. For example, a contractor that begins a furlough mid-week may consider not paying its employees for the days during that week the employees are on furlough. However, doing so for employees exempt from overtime under federal and state laws could place their exempt status in jeopardy.

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SBA Releases Interim Guidance to 8(a) Program Participants in Light of Lower Court Ruling

Source: SBA

NEW INTERIM GUIDANCE | SBA 8(a) Business Development Program – On August 18, the U.S. Small Business Administration released interim guidance regarding the 8(a) Business Development Program in light of a United States District Court ruling in Ultima Servs. Corp. v. Dep’t of Ag. affecting the Program’s determination of social disadvantage. The updated interim guidance for 8(a) Program participants and applicants can be found on the SBA’s website here. In addition, SBA recently published a new resource guide that firms can use to write the social disadvantage narrative Guide for Writing a Social Disadvantage Narrative - Certify Help Desk - Confluence (atlassian.net).

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What new federal cybersecurity policy means for government contractors

Source: C4ISRNET

In March, the U.S. government released a new Cybersecurity Strategy authored by the Office of the National Cyber Director.

Split into five Pillars and 27 Strategic Objectives, the strategy lays out a bold vision for defending critical infrastructure, dismantling threat actors, shaping market forces to drive security, investing in a resilient future and forging international partnerships. If fully implemented, this strategy will present businesses in the contracting space with the challenge of increased scrutiny and higher security standards, but also the opportunity to compete for orders and grants aimed at bolstering the nation’s critical digital infrastructure.

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