Government review of payroll records

You should ask the contracting officer for the authority for the request.

The question is not whether the FAR requires you to make records available - -the question is whether your contract requires you to make records available.

Perhaps your contract has a clause it in wherein you already agreed and granted permission. For example, if your contract contains the clause at FAR 52.215-20, you already agreed and granted permission in para. ( a )( 2 ). If your contract includes the clause at FAR 52.215-21, you already agreed and granted permission in that clause's para. ( a )( 2 ).

Even if you don't have such a clause in your contract you will have to satisfy the contracting officer that the amount you want is equitable. A monetary equitable adjustment after a change order must be based on the impact of the order on your costs of performance. You have to prove the measure of the impact; the contracting officer doesn't have to take your word for it. If you refuse to provide satisfactory proof to the contracting officer, he or she might reject your request for an adjustment or give you less than you want, and you might have to litigate in order to recover. If you litigate you'll have to prove your costs to a board of contract appeals or the Court of Federal Claims. You'll be subject to discovery. And litigation might cost money that you can't recover.

In short, the contracting officer doesn't need any "authority" to demand proof of your costs in response to your request for a price adjustment. My advice is: clause or no clause, let them see what they want to see and get on with negotiating a settlement.

jeff4757,

The government has broad lattitude to see whatever they want to see, especially when you are asking for a contract price adjustment. Even if you are within your contractual rights to deny access, somebody can call the IG and get a subpoena, and then you'll have to hire attorneys and you will STILL have to give the CO what s/he wants to see.

Payroll records are actually one of the easiest things to audit and there is very little risk to your company, especially if you have passed DCAA audits in the past. The only issue would be if you somehow manipulated hourly/salary rates, which (if you've passed prior DCAA audits) seems like a very remote possibility.

Finally: You are a government contractor; you will be audited from time to time. There is no sense complaining about it.

Or: what Vern said.

H2H

Thanks to you both! Much appreciate the feedback!

Excellent advice!

joel hoffman said:

Excellent advice!

It indeed was. And I appreciate that you bumped this, as I was strategizing how to best negotiate a REA I'd just received. On my second day at the new assignment!

On 1/7/2016 at 11:05 AM, ji20874 said:

if your contract contains the clause at FAR 52.215-20, you already agreed and granted permission in para. ( a )( 2 ).

Although this is somewhat late, this is one of my pet peeves.  52.215-20 is a solicitation provision not a contract clause.  According to the clause matrix, it is to be inserted in section L of the RFP.  As for clauses that might be applicable, in addition to 52.215-21, look at 52.215-2(b).  However, as stated before, no clause is really necessary in the circumstance described.

Retreadfed said:

Although this is somewhat late, this is one of my pet peeves.  52.215-20 is a solicitation provision not a contract clause.  According to the clause matrix, it is to be inserted in section L of the RFP.  As for clauses that might be applicable, in addition to 52.215-21, look at 52.215-2(b).  However, as stated before, no clause is really necessary in the circumstance described.

Assuming the clause at DFARS 252-243-7002 Requests for Equitable Adjustment (Dec 2012) is in the contract, this is a good place to draw from. I agree, however, that a clause is not fundamentally necessary just to collect the basic facts.