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  • Question

    If a contractor employee is gone on leave (or the position is vacant as a result of resignation/retirement) for a week or two of a month, above the hours built in to the proposal, but all the requirements are met for that month (just not the hours), is the contractor entitled to the full month's payment or does the fact that we didn't received all the hours bid matter? Under a performance based arrangement, my understanding is the contractor IS entitled to the full amount as long as the COR certifies all the performance requirements of the PWS were met for the month. Thank you!


    Answer

    1. The FAR references quoted below in pertinent part are applicable to this response.

    FAR 32.111 -- Contract Clauses for Non-Commercial Purchases
    (a) The contracting officer shall insert the following clauses, appropriately modified with respect to payment due dates, in accordance with agency regulations --
      (1) The clause at 52.232-1, Payments, in solicitations and contracts when a fixed-price supply contract, a fixed-price service contract, or … is contemplated;

    FAR 52.232-1 -- Payments
    The Government shall pay the Contractor, upon the submission of proper invoices or vouchers, the prices stipulated in this contract for supplies delivered and accepted or services rendered and accepted, less any deductions provided in this contract.

    2. Pursuant to FAR 32.111(a)(1), clause FAR 52.232-1 is required to be inserted in fixed-price service contracts. Based on the information provided in this inquiry, we assume that this clause is included in the basic contract and that its payment terms are therefore applicable to all fixed-price orders awarded under the contract.  Based on the information provided in this inquiry, we also assume that each order specifies a fixed unit billing price per month for the delivery of the Advisory and Assistance Services required by the PWS during the required performance period each month.

    3. Under the terms of this clause, the Government must pay the contractor the prices stipulated in the contract (or in the order in this case) for services rendered and accepted by the Government, less any deductions provided in the contract. Therefore, unless the contract (or order) expressly specifies that the monthly billing price will be reduced by any hours not worked by contractor personnel due to whatever cause that may be stated in the contract, then the negotiated monthly unit price must be paid to contractor for services rendered, provided that the COR (or Contracting Officer) certifies that all of the performance requirements of the PWS were met for the month.


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