The Government is Shutdown – But What About Your Contract?

Imagine you receive a brief communication from your Government Contracts Team informing your firm to stop work due to the shutdown. Some of you may not need to imagine this … given that we are now deep into the longest shutdown in history.

Even though you have a valid contract, and even if you have been receiving positive feedback from the contracts team about your performance, you may be instructed to stand down due to a Government shutdown.  Now you must take a pause in performance. This may mean telling your employees they cannot report to work if their duty station is within a Government facility.

It is unlikely that your contract’s Terms and Conditions provide any guidance on what to do during a stop in performance during a Government shutdown.

So, then, what do you do?

Your best course of action is to submit a written request asking the Government’s Contracting Officer to provide specific actions you must take, or stop taking, to comply with shutdown actions. It’s imperative that you get guidance in writing to protect your interests both during, and after, the shutdown.

Specifically request the Contracting Officer to confirm existing requirements and duties, or to provide changes you must make, in areas such as performing to the scope of work, accounting and invoicing instructions, task or delivery order guidance, employee work locations, hours and schedules, facility access, delivery quantities and locations, CLIN language, etc.

Your correspondence needs to request the Contracting Officer’s response by a certain date. If you have been told verbally anything regarding the topics above, your request needs to re-state the information you were told and ask for confirmation of the verbal guidance. If your Contracting Officer’s Representative, or a senior on-site Government point of contact have verbally provided guidance, ensure you seek written confirmation of this as well.

Of course, it is possible that you may not be able to reach your Contracting Officer either before, or after, the shutdown begins. In this case, you have little recourse but to make your best attempts at communication and then make assumptions about the actions you must take. For example, before a shutdown, send both emails and certified letters expressing your concerns or requests. If you don’t receive a response or useful guidance before the shutdown occurs, use your questions / guidance request as a foundation and make some assumptions about what you should be doing, outline courses of action, and document both assumptions and courses of action in another email and letter, and send these along to the Contracting Officer, requesting that they contact you as soon as possible after the shutdown concludes. If nothing else, you’ve made a good faith effort to communicate and take appropriate actions. These communications will become important in follow-on negotiations.

Bottom line: Shutdowns can cause unforeseen changes and potentially long-term complex contract problems if guidance is not received, and appropriate actions are not initiated immediately. Your firm may have thought it would never encounter a shutdown, but in today’s world, shutdowns are all too often a reality.

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