subcontractor indirect rates
Started by dianechais · Oct 1, 2011 · 1 replies
- dOriginal post
dianechais
Oct 1, 2011 · 14y ago
under a CPFF contract, prime contract has ceiling on indirect rates, subcontract did not flow down ceiling rates, is the prime contractor required to pay rates which exceed ceiling in their contract? Any thoughts are appreciated.
- G
Guest Vern Edwards
Oct 1, 2011 · 14y ago
I assume that the subcontract is also CPFF.
The answer to your question depends entirely on what the subcontract says, but based on the information that you provided, the answer is yes, the prime must pay the sub's rates, even if they exceed the ceilings in the prime contract. The prime contract is between the prime and its customer. The subcontract is between the prime and its sub.