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  • Question

    Can labor hours be converted to ODC dollars for consultant costs under a CPFF?


    Answer

    A time-and-materials contract type (or line item) is permitted when it is not possible at the time of placing the contract to estimate accurately the extent or duration of the work or to anticipate costs with any reasonable degree of confidence (ref. FAR 16.601(c)). Presumably, the key employee's hours were able to be estimated with some measure of accurately for this CPFF contract (or a T&M could have been used to begin with). If the nature of the employee's work during the contract hasn't changed, then simply converting the cost reimbursable labor hours to an other-direct-cost (as consultant hours) does not appear to pose a problem. Any such change must of course be discussed with the Government contracting officer, whose approval must be obtained.

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