When a Protégé Rebels Against Its Mentor: The Price Contractors Pay for Not Knowing Fiduciary Duties
What happens when a protégé rebels against its mentor? In a recent decision from the Eleventh Circuit, Yorktown Sys. Grp. Inc., v. Threat Tec LLC1, the court had to deal with such a question after Threat Tec, the protégé and small business in a joint venture, terminated its mentor, Yorktown, in order to acquire its workshare. In this opinion delivered by Judge Ed Carnes, the Eleventh Circuit affirmed the Northern District of Alabama’s decision to grant Yorktown a preliminary injunction . . . Read More
Newly Increased Health and Welfare Rates on SCA Government Contracts
The Department of Labor’s (DOL) Wage and Hour Division (WHD) has again issued new Service Contract Act (SCA) health and welfare (H&W) rates. In July 2024, WHD increased the prevailing H&W fringe benefits from a rate of $4.98 per hour to $5.36 per hour. Where a contractor is obligated to comply with Executive Order (EO) 13706 sick leave obligations, the rates have increased from $4.57 per hour to $4.93 per hour. Updated rates of $2.36 per hour (without the EO) . . . Read More
Texas Court Order Imperils FTC’s Forthcoming Non-Compete Ban
On July 3, 2024, the District Court for the Northern District of Texas stayed enforcement of the Federal Trade Commission’s (FTC) impending ban on non-compete agreements between employers and employees (the Rule) pending the outcome of ongoing litigation.1 While the injunction currently only applies to the parties in the case, the court has committed to publishing its final ruling on or before August 30, 2024, in advance of the Rule’s implementation date. The decision is a window into how the . . . Read More
Construction Industry Wage-and-Hour Issues: 6 Tips for Laying a Foundation of Compliance
The construction industry feeds a significant part of the U.S. economy, providing millions of short- and long-term jobs across the country on an annual basis. Since the passage of the Infrastructure Investment and Jobs Act in late 2021, the federal government has begun pumping the Congressionally-allocated $1.2 Trillion into transportation and infrastructure spending, with over $550 Billion allocated to new investments and programs. This federal re-investment into the construction industry, added to already-robust private construction spending, has led to increased . . . Read More
Broken Promises: The Government’s Ability to Trick Contractors and Get Away With It (Maybe)
As the government embraced the digital age in the years after COVID-19, its need for new software and technologies skyrocketed. This rapidly expanding procurement need presents great opportunities for businesses—both small and large—to satisfy the government’s needs. But every opportunity carries risks. In this blog, PilieroMazza explores a case that sheds light on (1) the risks posed by the ever-changing nature of software, (2) the government’s acquisition of new software using multi-option-year contracts, and (3) the legal enforceability of negotiated . . . Read More
Proactive Measures for Impending Increases to FLSA Salary Basis for White Collar Employees
Announced on April 23, 2024, the Department of Labor’s (DOL) Wage and Hour Division’s (WHD) final rule (Rule)—Defining and Delimiting the Exemptions for Executive, Administrative, Professional, Outside Sales, and Computer Employees—will begin impacting employers as soon as July 1, 2024. Under the Rule, to maintain employee white-collar exemptions, employers will need to ensure employees are paid a salary of $844 weekly or $43,888 annually ($132,964 annually for highly compensated employees). These thresholds will increase again on January 1, 2025, to $1,128 weekly . . . Read More
Coming Soon! CISA’s Proposed Rule on Government-wide Cybersecurity Reporting Requirements for Contractors
The Cyber Incident Reporting for Critical Infrastructure Act (CIRCIA) was enacted in 2022 with the primary purpose of preserving national security, economic security, and public health and safety. CIRCIA provides the Director of the Cybersecurity and Infrastructure Security Agency (CISA) authority to enact rules regarding various reporting requirements therein. In early April 2024, CISA released a proposed rule ( Rule ) with two significant requirements: (1) a 72-hour deadline to report covered cyber incidents and (2) a 24-hour deadline to report . . . Read More
Question the Questions and the Answers: Bid Protest Decision Highlights Need to Clarify Ambiguities Prior to Bidding
Many solicitations for government contracts provide prospective contractors with the opportunity to ask questions. In some instances, the government’s answers to those questions create additional questions. When that’s the case, it’s crucial to seek clarification early; waiting to see how the procurement unfolds can have drastic consequences, leaving contractors with no recourse. A recently issued bid protest decision from the U.S. Court of Federal Claims—Eagle Hill Consulting, LLC v. United States [1] —highlights this important point. In Eagle Hill, the Federal . . . Read More
The Case for Intervening in Bid Protests: It’s Almost Always the Right Call
You’re a federal government contractor who just won a contract award. But, before you pop the champagne, there’s a hiccup: a competitor filed a bid protest challenging your award. “Oh, well,” you think, “the government can surely defend my award; there’s no reason for me to get involved.” Think again. This blog covers why contractors should step in and intervene when a bid protest challenges their awarded contract. It’s not just about safeguarding your contract; it’s also about ensuring you . . . Read More
Enforceability of Pay-if-Paid Clauses in Construction Subcontracts: Mid-Atlantic Region
Pay-if-paid clauses are conditional payment provisions regularly included in construction subcontracts. The intent of these clauses is to shift the risk of loss from a prime contractor to its subcontractors by making a project owner’s payment to the prime contractor a condition precedent to the prime contractor’s obligation to pay its subcontractors. [1] The enforceability of pay-if-paid clauses is a frequent topic of dispute, becoming more complicated when a prime contractor posts a payment bond protecting subcontractors and suppliers from non-payment . . . Read More