FedGovContracts.com

Barry McVay's FEDERAL CONTRACTS DISPATCH

DATE: December 28, 2000

FROM: Barry McVay, CPCM

SUBJECT: Federal Acquisition Regulation (FAR); Signing and Retention of High-Technology Workers

SOURCE: Federal Register, December 28, 2000, Vol. 65, No. 250, page 82875

AGENCIES: Department of Defense (DOD), General Services Administration (GSA), and National Aeronautics and Space Administration (NASA)

ACTION: Proposed Rule

SYNOPSIS: It is proposed that FAR 31.205-34, Recruitment Costs, be amended to explicitly make allowable signing and retention bonuses that contractors often must offer in order to recruit and retain workers that have critical technical skills.

DATES: Comments should be submitted on or before February 26, 2001.

ADDRESSES: Submit comments to General Services Administration, FAR Secretariat (MVR), 1800 F Street, NW, Room 4035, ATTN: Laurie Duarte, Washington, DC 20405; e-mail: farcase.2000-014@gsa.gov. Cite FAR case 2000-014 in all correspondence related to this proposed rule.

FOR FURTHER INFORMATION CONTACT: Jeremy Olson, Procurement Analyst, 202-501-0692.

SUPPLEMENTAL INFORMATION: Because of the tight labor market, companies doing business with the government often must provide recruitment and retention bonuses to compete with predominantly non-government firms to attract personnel with critical technical skills. This practice is similar to the practice in the government of permitting signing bonuses for difficult-to-fill positions and retention allowances for essential government employees.

The proposed rule would revise FAR 31.205-34, Recruitment Costs, to explicitly allow "signing bonuses needed to recruit employees with critical skills (such as scientists and engineers in fields like software and systems integration), if comparable to the signing bonuses being offered by firms engaged in predominantly non-government work to attract similar job skills; and periodic retention bonuses needed to retain employees with critical skills (such as scientists and engineers in fields like software and systems integration), if comparable to the periodic retention bonuses being paid by firms engaged in predominantly non-government work to retain similar job skills."

EDITOR'S NOTE: High-tech companies have been doing this for years -- remember the dot.com stock options? This proposed rule would merely have the FAR bless the practice.

FOR FURTHER INFORMATION CONTACT: Barry McVay at 703-451-5953 or by e-mail to BarryMcVay@FedGovContracts.com.

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