On November 18, DoD issued a final rule requiring offerors in DoD procurements to represent that former DoD officials employed by the contractor are complying with post-employment restrictions applicable to that contractor. Such post-employment restrictions are found in the Procurement Integrity Act and Section 847 of the National Defense Authorization Act (NDAA) for Fiscal Year (FY) 2008.
Federal Acquisition Regulation Part 3.104 implements the Procurement Integrity Act and applies to all Government employees. Among its provisions, the Procurement Integrity Act prohibits certain activities by former Government employees, including representation of a contractor before the Government in relation to any contract or other particular matter involving specific parties on which the former employee participated personally and substantially while employed by the Government. Additional restrictions apply to certain senior Government employees and for particular matters under an employee’s official responsibility.
Section 847 of NDAA FY 2008 inserted a new clause in DoD contracts, 252.203-7000, Requirements Relating to Compensation of Former DoD Officials, which prohibits a DoD contractor from knowingly providing compensation to a “covered DoD official” within 2 years after the official leaves DoD without first determining that the official has sought and received, or has not received after 30 days of seeking, a written opinion from the appropriate DoD ethics counselor regarding the applicability of post-employment restrictions to the activities the official is expected to undertake on behalf of the contractor. The clause defines a “covered DoD official” as an individual who left DoD on or after January 2008 and either participated “personally and substantially” in certain acquisitions with a value in excess of $10 million or served as a program manager, deputy program manager, procuring contracting officer, administrative contracting officer, source selection authority, member of the source selection evaluation board, or chief of a financial or technical evaluation team for a contract in an amount in excess of $10 million.
Under the new rule, promulgated at 252.203-7005, Representation Relating to Compensation of Former DoD Officials, an offeror must represent that, to the best of its knowledge and belief, all covered DoD officials (same definition as above) employed by or otherwise receiving compensation from the offeror are presently in compliance with all applicable post-employment restrictions. The representation only needs to be made once and in connection with a specific proposal; it will not be included in the annual representations and certifications. The representation requirement only applies in the DoD context and, in that regard, it applies to all DoD solicitations, including those for commercial items and for task and delivery orders.
The rule is effective November 18, 2011.
The preamble of the rule contains a number of comments and responses thereto by DoD. The main takeaway from these comments is that DoD believes it is incumbent on the contractor to thoroughly screen and investigate those matters in which a former DoD official job candidate was involved as well as to track that individual’s ongoing role and responsibilities at the company once the candidate is hired. Given the complexities of the post-employment restrictions, also known as the “revolving door” regulations, a contractor also should consult with a government contracts attorney well-versed in these matters. (You can contact me at firstname.lastname@example.org. :)).
The rule stems from a May 2008 Government Accountability Report (GAO) entitled “Defense Contracting: Post-Government Employment of Former DoD Officials Needs Greater Transparency.” GAO found that contractors significantly under reported the employment of former DoD officials and, from that, concluded that defense contractors may employ a substantial number of former DoD officials on assignments related to their former positions.
If you have been around the block once or twice in this field, you know this rule really goes back to 2003 and the Darlene Druyan debacle. As Don Rumsfeld said at that time, there was not enough “adult supervision” over relationships between acquisition officials on major defense programs and the defense contractors involved in those programs.