This article appeared in the November 2021 issue of SC Employment Law Letter. Click here for the pdf.

Updated October 7, 2021

On September 27, 2021 Burr & Forman published COVID-19 Vaccine Guidance for Federal Contractors, noting that the Federal Acquisition Regulatory Council was to develop a mandatory Federal Acquisition Regulation (“FAR”) clause for new contracts and solicitations over the Simplified Acquisition Threshold (currently $250,000.00). The FAR Council has published the new clause (“COVID Clause”), and has asked contracting agencies to develop deviations allowing use of the new COVID Clause. So far, three of the largest contracting agencies—the Department of Defense (“DoD”), General Services Administration (“GSA”), and Veterans Affairs (“VA”)—have all published deviations directing their contracting officers to incorporate the COVID Clause.

What’s a “Deviation?”

A “deviation” in this case is a way that the FAR Council can direct agency contracting action before it adopts a final rule. As noted, the FAR Council has asked contracting agencies to “act expeditiously” to put together deviations so contracting officers can begin incorporating the clause into their solicitations and contracts by October 15th, which is too fast for the FAR Council to adopt a new rule with notice and comment. Thus, the current COVID Clause is a “Deviation” clause, to be updated when the FAR Council adopts a final rule and clause.

What Does the COVID Clause Say?

The text of the COVID Clause is relatively straightforward:

52.223-99 Ensuring Adequate COVID-19 Safety Protocols for Federal Contractors.

ENSURING ADEQUATE COVID-19 SAFETY PROTOCOLS FOR FEDERAL CONTRACTORS (OCT 2021) (DEVIATION)

(a) Definition. As used in this clause-

United States or its outlying areas means—

(1) The fifty States;

(2) The District of Columbia;

(3) The Commonwealth of Puerto Rico and the Northern Mariana Islands;

(4) The territories of American Samoa, Guam, and the United States Virgin Islands; and

(5) The minor outlying islands of Baker Island, Howland Island, Jarvis Island, Johnston    Atoll, Kingman Reef, Midway Islands, Navassa Island, Palmyra Atoll, and Wake Atoll.

(b) Authority. This clause implements Executive Order 14042, Ensuring Adequate COVID Safety Protocols for Federal Contractors, dated September 9, 2021 (published in the Federal Register on September 14, 2021, 86 FR 50985).

(c) Compliance. The Contractor shall comply with all guidance, including guidance conveyed through Frequently Asked Questions, as amended during the performance of this contract, for contractor or subcontractor workplace locations published by the Safer Federal Workforce Task Force (Task Force Guidance) at https:/www.saferfederalworkforce.gov/contractors/

(d) Subcontracts. The Contractor shall include the substance of this clause, including this paragraph (d), in subcontracts at any tier that exceed the simplified acquisition threshold, as defined in Federal Acquisition Regulation 2.101 on the date of subcontract award, and are for services, including construction, performed in whole or in part within the United States or its outlying areas.

Note: The COVID Clause requires covered contractors to comply with Executive Order 14042 and all guidance issued by the Safer Federal Workforce Task Force “as amended during the performance of the contract,” which requires the contractor be aware of and comply with changing guidance throughout performance.

Current Deviations

So far, the GSA, VA, and Department of Defense have all published deviations providing guidance to their contracting officers on when they should insert the COVID Clause.

GSA Deviation

The text of the GSA Deviation is here. As Executive Order 14042 requires, GSA directs contracting officers to insert the COVID Clause in all new contracts and task or delivery orders over the Simplified Acquisition Threshold or Simplified Lease Acquisition Threshold (currently $250,000/year in rent) except for those solely for the manufacturing of products. GSA also “strongly encourages” contracting officers to include the COVID Clause in contracts over the Micro-Purchase Threshold but under the Simplified Acquisition Threshold (or Simplified Lease Acquisition Threshold) and to contracts for manufacturing of products. GSA has also directed its contracting officers to send out bilateral modification requests on existing contracts to incorporate the COVID Clause.

GSA contracting officers may not include the COVID Clause in contracts under the Micro-Purchase Threshold (currently $10,000), for site acquisition, concerning sales of surplus property, contracts for performance outside the United States, and with Indian Tribes under the Indian Self Determination and Education Act (this does not include Indian- or tribally-owned business entities).

Department of Defense Deviation

The text of the DoD Deviation is here. The DoD directs contracting officers to insert its version of the COVID Clause[1] in all solicitations, contracts, task orders, delivery orders, extensions, renewals, exercised options, and existing indefinite-delivery, and indefinite-quantity vehicles anticipated to have orders, over the Simplified Acquisition Threshold. From the language, it appears that DoD plans to incorporate its COVID Clause into contracts that are solely for manufacturing products—a major expansion from Executive Order 14042. But later in its Deviation, DoD tells contracting officers they “may” incorporate its COVID Clause into “solicitations, contracts, task orders, and delivery orders for the manufacturing of products,” indicating it is not mandatory for those contracts. Regardless, it is likely that contracting officers will insert the DoD COVID Clause in manufacturing contracts to stay on the safe side. This also conforms with the White House’s stated objective in getting as many vaccines into arms as possible. The DoD Deviation also allows contracting officers to insert its COVID Clause into contracts under the Simplified Acquisition Threshold and already-issued solicitations as well as using bilateral modifications to insert it into already-existing contracts and task and delivery orders.

DoD contracting officers may not insert the clause into contracts with Indian Tribes under the Indian Self Determination and Education Act (this does not include Indian- or tribally-owned business entities) or in contracts to be performed outside of the United States.

Veterans Affairs

The text of the VA Deviation is here. The VA’s deviation requires contracting officers to include the COVID clause in all new contracts awarded on or after November 14 from solicitations issued before October 15, new solicitations issued on or after October 15, extensions or renewals of existing contracts on or after October 15, and exercised options on or after October 15, all including task and delivery orders. Notably, there is no carve-out language for manufacturing contracts. The VA also encourages, but does not require, contracting officers to insert the clause in contracts awarded before November 14 on solicitations issued before October 15 and contracts under the Simplified Acquisition Threshold.

VA contracting officers may not insert the clause into contracts with Indian Tribes under the Indian Self Determination and Education Act (this does not include Indian- or tribally-owned business entities) or in contracts to be performed outside of the United States.

What to Expect

More contracting agencies will issue deviations in the coming days and weeks. Contractors should expect to see the COVID Clause appear in all new solicitations and awards going forward. When preparing bids and proposals responsive to solicitations issued after October 15 or to be awarded after November 15, contractors should take the cost of compliance with the COVID Clause into account and factor that into price/cost proposals.

If you’re a current contract holder, it is likely that the contracting agency will send a bilateral modification request seeking to incorporate the COVID Clause. Failure to agree to the bilateral modification request may result in the contracting agency taking adverse actions—for example, GSA may delist or hide the contractor from GSA websites.

We recommend reaching out to your Burr & Forman attorney to discuss any of the relevant timelines or what to do when you receive a request for a bilateral modification.

As more agencies provide deviations for their contracting officers, we will try to provide links so you can stay current with your relevant contracting agencies.

The Civilian Agency Acquisition Council deviation is found here.

The Department of Justice deviation is found here.

The Department of Homeland Security deviation is found here.

NASA’s deviation is found here.

The Millennium Challenge Corporation’s deviation is found here.

[1] Other than numbering to keep its clause consistent with the Defense Federal Acquisition Regulations Supplement, the text of the Department of Defense’s COVID Clause appears identical to the FAR Council’s.