Nondisplacement Rule Needs Consistency, Flexibility, Clarity

Arlington, Va., July 5, 2012—The Professional Services Council questioned the FAR Council’s proposed “Nondisplacement of Qualified Workers Under Service Contracts” rule that imposes unnecessary and confusing compliance burdens on contractors. PSC recommended changes to address industry’s concerns, in comments filed July 2. “The proposed rule’s attempt to mandate how contractors staff projects during turbulent economic times is unnecessary and counterproductive,” PSC Executive Vice President and Counsel Alan Chvotkin said in the comments.

The FAR proposed rule further implements an August 2011 final Labor Department rule requiring contractors to hire all “qualified” personnel inherited by virtue of winning a contract re-competition for Service Contract Act covered contracts. PSC opposed the Labor Department rule as an inappropriate and unnecessary intrusion by the government into company personnel practices.

“While it is certainly true that many successor contractors already voluntarily hire many of their predecessors’ employees to promote certain efficiencies, these efficiencies will be greatly reduced by inflexibly mandating—under threat of penalties imposed by DoL—that nearly all successors must offer jobs to nearly all of their predecessor’s employees regardless of skill, qualifications, and job performance,” Chvotkin wrote.  “Successor contractors already exercise business judgment as to when efficiencies will result from offering jobs to their predecessors’ employees—and exercise this judgment without the need for taxpayer dollars to be spent investigating and issuing rulings about who should have offered jobs to whom.”

PSC’s comments are available here.

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About PSC: PSC has been the voice of the government professional and technical services industry for 40 years. PSC’s nearly 350 member companies represent small, medium, and large businesses that provide federal agencies with services of all kinds, including information technology, engineering, logistics, facilities management, operations and maintenance, consulting, international development, scientific, social, environmental services, and more. Together, the trade association’s members employ hundreds of thousands of Americans in all 50 states. Follow PSC on Twitter @PSCSpeaks and @StanSoloway.