Government Contracts Update - Final Rule Implementing Executive Order Regarding Nondisplacement of Qualified Workers Under Service Contracts Become Effective January 18, 2013

On December 22, 2012, a final rule was issued (77 Fed. Reg 75,766) amending the Federal Acquisition Regulation (FAR) to implement an Executive Order for Nondisplacement of Qualified Workers Under Service Contracts (Executive Order 13495) and the rule applies to all solicitations issued on or after January 18, 2013. The Executive Order also is implemented under the Department of Labor regulations at 29 CFR Part 9 with a January 18, 2013 effective date.

Issued in 2009, Executive Order 13495 establishes a general policy of the Federal Government concerning service contracts for performance of the same or similar services at the same location. The policy mandates that contracts include a clause requiring the successor contractor and its subcontractors to offer those employees employed under the predecessor contract, whose employment will be otherwise terminated as a result of the successor contract, a right of first refusal of employment under the successor contract in positions for which they are qualified.

The rule aims to minimize the disruption of services during transition between predecessor and successor contractors and support efficiency through the employment of trained employees. Contracting Officers are expected to work with their existing contractors to bilaterally modify their contracts to include a clause at FAR 52.222-17, which, among other requirements, provides that the predecessor contractor: (1) inform its workforce of their right of first refusal; and (2) provide a certified list of its service employees to the Contracting Officer no less than thirty (30) days before contract completion.

For more information about the impact of Executive Order 13495, please contact Terry Murphy or Karla Soloria of the Kaufman & Canoles Government Contracts and Construction Practice Group.

The contents of this publication are intended for general information only and should not be construed as legal advice or a legal opinion on specific facts and circumstances.


The contents of this publication are intended for general information only and should not be construed as legal advice or a legal opinion on specific facts and circumstances. Copyright 2017.

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