If you're a GSA Schedule contract holder it’s important to uphold the standards of ethics outlined in the Federal Acquisition Regulation (FAR). Becoming familiar with these sometimes dense and taxing regulations can be difficult. However, these policies and regulations are in place so that the integrity of contractors and government officials is upheld. This blog will explore some of the main FAR clauses and the best business practices contractors should follow to comply with government contracting ethics.
The restrictions on what businesses are permitted to do for government workers ensure all companies comply with established ethical principles. Most federal ethics regulations mirror the business ethics and conduct that are standard for any successful business, so they are not way out of bounds from what you are used to. However, it’s still important to make sure everyone in your company is aware of these regulations so you remain a compliant GSA contractor.
As a government contractor, you should not engage in giving any kind of monetary expression of appreciation to your Contracting Officers and/or any other government representatives. Monetary privileges include but are not limited to discounts, loans, gratuities, transportation, lodging, meals, and forbearance. The FAR clause 3.101 addresses solicitation and acceptance of gratuities and disciplinary measures for violation. Exceptions include gratuities received for personal services and those among military departments or defense agencies and foreign governments. Undermining this regulation can lead to severe repercussions such as suspension or debarment.
Contractors should verify that the goods and services invoiced display the exact value of what was offered. According to FAR 52.212-4(i)(5), only items accepted require payment. Things can easily slip through the cracks regarding overpayment. However, if a contractor becomes aware of overpayment, that money must be returned with a description of the overpayment in receipt to comply with the payment clauses stated in FAR. These payment clauses includes sections 52.232-26(c), 52.232-25, and 52.232-27.
Compensation offered to a prime or subcontractor in exchange for favorable treatment, referred to as a kickback, is also not permissible. The Anti-Kickback Act was passed in 1986 to prevent such acts from occurring. Contractors should take heed of the anti-kickback procedures included in FAR 52.203-7. These procedures prohibit the solicitation of or acceptance of any kickback.
Not only is it important to have a set of internal ethics to abide by and act as an extension of the FAR ethics, it’s required of all GSA contractors. Contractors must draft a code of ethics for their company as required in FAR 52.203-13, Contractor Code of Business Ethics and Conduct, and distribute it to contractors performing work on a government contract within 30 days after contract award. This regulation is designed to prevent and enforce government contracting ethics.
Contractors should take the following measures to encourage strong ethics:
Contractors can position themselves to remain in compliance by establishing good practices at the start of their GSA Schedule contract. It’s better to be safe than sorry when dealing with federal regulations and requirements. While the expectation is not that businesses should know everything there is to know about government contracting ethics, the more your business is informed the greater the chance of remaining in compliance.
Ethics are an essential part of maintaining a GSA Schedule contract. If you are an existing or prospective GSA Schedule contractor, keeping up with various compliance measures may be challenging. For more information on FAR clauses that relate to GSA contractors, check out our blog "13 Important FAR Clauses for GSA Contractors."
For assistance navigating government contractor ethics regulations or to create a business code of ethics contact our experienced team at Winvale.