[Federal Register Volume 59, Number 230 (Thursday, December 1, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-29422]


[[Page Unknown]]

[Federal Register: December 1, 1994]


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DEPARTMENT OF DEFENSE

GENERAL SERVICES ADMINISTRATION

NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

48 CFR Part 3

[FAR Case 94-803]

 

Federal Acquisition Regulation; Whistleblower Protections for 
Contractor Employees (Ethics)

AGENCIES: Department of Defense (DOD), General Services Administration 
(GSA), and National Aeronautics and Space Administration (NASA).

ACTION: Proposed rule.

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SUMMARY: This proposed rule is issued pursuant to the Federal 
Acquisition Streamlining Act of 1994, Public Law 103-355 (the Act). The 
FAR Council is considering the addition of a new subpart 3.9, entitled 
``Whistleblower Protections for Contractor Employees.'' This new 
subpart is the result of the enactment of Sections 6005 and 6006 of the 
Act. This regulatory action was not subject to Office of Management and 
Budget review under Executive Order 12866, dated September 30, 1993.

DATES: Comments should be submitted on or before January 30, 1995 to be 
considered in the formulation of a final rule.

ADDRESSES: Interested parties should submit written comments to: -
General Services Administration, FAR Secretariat (VRS),-18th & F 
Streets, NW, Room 4037, Washington, DC 20405.
    Please cite FAR case 94-803 in all correspondence related to this 
case.

FOR FURTHER INFORMATION CONTACT: Mr. Julius Rothlein, Ethics Team 
Leader, at (703) 697-4349 in reference to this FAR case. For general 
information, contact the FAR Secretariat, Room 4037, GS Building, 
Washington, DC 20405 (202) 501-4755. Please cite FAR case 94-803.

SUPPLEMENTARY INFORMATION:

A. Background

    The Federal Acquisition Streamlining Act of 1994, Pub. L. 103-355, 
provides authorities that streamline the acquisition process and 
minimize burdensome government-unique requirements. Major changes that 
can be expected in the acquisition process as a result of the Federal 
Acquisition Streamlining Act implementation include changes in the 
areas of Commercial Item Acquisition, Simplified Acquisition 
Procedures, the Truth in Negotiations Act, and introduction of the 
Federal Acquisition Network.
    FAR case 94-803 originated because with the enactment of Sections 
6005 and 6006, whistleblower protections for contractor employees are 
now virtually identical for contractors employed by both DoD and 
civilian agencies.
    A new subpart is being added to FAR Part 3 which states that these 
protections apply to contractor employees on all Government contracts. 
In implementing these sections, guidance found at page 222 of 
Conference Report 103-712 was considered which states: ``The conferees 
direct that the regulations implementing this provision should 
establish procedures and standards that are as similar as practicable 
to the procedures and standards already established in Department of 
Defense regulations.'' However, unlike DoD FAR Supplement (DFARS) 
subpart 203.71 (which implemented the former, and now repealed 10 
U.S.C. 2409a), a clause which must be included in all contracts is not 
being mandated. It is noted that, unlike 10 U.S.C. 2409a, neither 
Section 6005 nor 6006 contains any language which mandates the 
inclusion of a specific clause in contracts to enforce the prohibitions 
of the law. Enforcement of this law, like so many other laws, is not 
dependent on the presence of a clause in the contract. Furthermore, by 
not prescribing a clause for all contracts, the physical size of the 
contract document can be reduced and thereby further the acquisition 
streamlining effort.
    This case also includes a provision which requires that 
whistleblower complaints be filed not more than 180 days after the date 
on which the violation is alleged to have occurred or the date on which 
the violation was discovered. This approach was used to ensure that the 
Inspector General will be reviewing matters that can be reasonably 
investigated. While neither Section 6005 nor 6006 contain a statute of 
limitations, 10 U.S.C. 2409a and its implementing regulations provided 
for same, and it is reasonable to include same in these regulations.
    The FAR Council is interested in an exchange of ideas and opinions 
with respect to the regulatory implementation of the Act. For that 
reason, the FAR Council is conducting a series of public meetings. 
However, the FAR Council has not scheduled a public meeting on this 
rule (FAR case 94-803) because of the clarity and non-controversial 
nature of the rule. If the public believes such a meeting is needed 
with respect to this rule, a letter requesting a public meeting and 
outlining the nature of the requested meeting shall be submitted to and 
received by the FAR Secretariat (see ADDRESSES caption) on or before 
January 3, 1995.
    The FAR Council will consider such requests in determining whether 
a public meeting on this rule should be scheduled.

B. Regulatory Flexibility Act

    The proposed rule is not expected to have significant economic 
impact on a substantial number of small entities within the meaning of 
the Regulatory Flexibility Act, 5 U.S.C. 601, et seq. During the past 
four years under 10 U.S.C. 2409a, DoD processed less than 70 cases, 
half against large contractors. Contractor employee whistleblower 
actions are not expected to increase significantly as a result of the 
enactment of Sections 6005 and 6006. An Initial Regulatory Flexibility 
Analysis has, therefore, not been performed. Comments are invited from 
small businesses and other interested parties. Comments from small 
entities concerning the affected FAR subpart will also be considered in 
accordance with Section 610 of the Act. Such comments must be submitted 
separately and cite FAR case 94-803 in correspondence.

C. Paperwork Reduction Act-

    The Paperwork Reduction Act does not apply because the proposed 
changes to the FAR do not impose recordkeeping or information 
collection requirements, or collections of information from offerors, 
contractors, or members of the public which require the approval of the 
Office of Management and Budget under 44 U.S.C. 3501, et seq.

List of Subjects in 48 CFR Part 3

    Government procurement.

    Dated: November 23, 1994.
Edward C. Loeb,
Deputy Project Manager for the Implementation of the Federal 
Acquisition Streamlining Act of 1994.

    Therefore, it is proposed that 48 CFR Part 3 be amended as set 
forth below:

PART 3--IMPROPER BUSINESS PRACTICES AND PERSONAL CONFLICTS OF 
INTEREST-

    1. The authority citation for 48 CFR Part 3 continues to read as 
follows:

    Authority: 40 U.S.C. 486(c); 10 U.S.C. chapter 137; and 42 
U.S.C. 2473(c).

    2. Subpart 3.9, consisting of sections 3.900 through 3.906, is 
added to read as follows:

Subpart 3.9--Whistleblower Protections for Contractor Employees

3.900  Scope of subpart.
3.901  Definitions.
3.902  Applicability.
3.903  Policy.
3.904  Procedures for filing complaints.
3.905  Procedures for investigating complaints.
3.906  Remedies.


3.900  Scope of subpart.-

    This subpart implements 10 U.S.C. 2409 and 41 U.S.C. 251, et seq., 
as amended by Public Law 103-355, Sections 6005 and 6006.


3.901  Definitions.-

    Authorized official of an agency means an officer or employee 
responsible for contracting, program management, audit, inspection, 
investigation, or enforcement of any law or regulation relating to 
Government procurement or the subject matter of the contract.
    Authorized official of the Department of Justice means any person 
responsible for the investigation, enforcement, or prosecution of any 
law or regulation.
    Head of agency, within the Department of Defense, means the 
Secretaries of Defense, Army, Navy, and Air Force. For civilian 
agencies, see (FAR) 48 CFR 2.101.
    Inspector General means an Inspector General appointed under the 
Inspector General Act of 1978, as amended. In the Department of Defense 
that is the DOD Inspector General. In the case of an executive agency 
that does not have an Inspector General, the duties shall be performed 
by an official designated by the head of the executive agency.


3.902  Applicability.

    This subpart applies to all Government contracts.


3.903  Policy.

    Government contractors shall not discharge, demote or otherwise 
discriminate against an employee as a reprisal for disclosing 
information to a Member of Congress, an authorized official of an 
agency or of the Department of Justice, relating to a substantial 
violation of law related to a contract (including the competition for 
or negotiation of a contract).


3.904  Procedures for filing complaints.-

    (a) Any employee of a contractor who believes that he or she has 
been discharged, demoted, or otherwise discriminated against contrary 
to the policy in 3.903 may file a complaint with the Inspector General 
of the agency that awarded the contract.
    (b) Complaints shall be filed not more than 180 days after the date 
on which the reprisal is alleged to have occurred or the date on which 
the reprisal was discovered, whichever is later.
    (c) The complaint shall be signed and contain--
    (1) The name of the contractor;
    (2) The contract number, if known; if not, a description reasonably 
sufficient to identify the contract(s) involved;
    (3) The substantial violation of law giving rise to the disclosure;
    (4) The nature of the disclosure giving rise to the discriminatory 
act; and
    (5) The specific nature and date of the reprisal.


3.905  Procedures for investigating complaints.

    (a) Upon receipt of a complaint, the Inspector General shall 
conduct an initial inquiry. If the Inspector General determines that 
the complaint is frivolous or for other reasons does not merit further 
investigation, the Inspector General shall advise the complainant that 
no further action on the complaint will be taken.
    (b) If the Inspector General determines that the complaint merits 
further investigation, the Inspector General shall notify the 
complainant, contractor, and head of the contracting activity. The 
Inspector General shall conduct an investigation and provide a written 
report of findings to the head of the agency.-
    (c) Upon completion of the investigation, the head of the agency 
shall ensure that the Inspector General provides the report of findings 
to--
    (1) The complainant and any person acting on the complainant's 
behalf;-
    (2) The contractor alleged to have committed the violation; and-
    (3) The head of the contracting activity.
    (d) The complainant and contractor shall be afforded the 
opportunity to submit a written response to the report of findings 
within 30 days to the head of the agency.
    (e) At any time, the head of the agency may request additional 
investigative work be done on the complaint.


3.906  Remedies.-

    (a) If the head of the agency determines that a contractor has 
subjected one of its employees to a reprisal for providing information 
to a Member of Congress, an authorized official of an agency or the 
Department of Justice, the head of the agency may take one or more of 
the following actions:
    (1) Order the contractor to take affirmative action to abate the 
reprisal.-
    (2) Order the contractor to reinstate the person to the position 
that the person held before the reprisal, together with the 
compensation (including back pay), employment benefits, and other terms 
and conditions of employment that would apply to the person in that 
position if the reprisal had not been taken.
    (3) Order the contractor to pay the complainant an amount equal to 
the aggregate amount of all costs and expenses (including attorneys' 
fees and expert witnesses' fees) that were reasonably incurred by the 
complainant for, or in connection with, bringing the complaint 
regarding the reprisal.
    (b) Whenever a contractor fails to comply with an order, the head 
of the agency shall request the Department of Justice to file an action 
for enforcement of such order in the United States district court for a 
district in which the reprisal was found to have occurred. In any 
action brought under these provisions, the court may grant appropriate 
relief, including injunctive relief and compensatory and exemplary 
damages.
    (c) Any person adversely affected or aggrieved by an order issued 
under these provisions may obtain review of the order's conformance 
with the law, and these regulations, in the United States Court of 
Appeals for a circuit in which the reprisal is alleged in the order to 
have occurred. No petition seeking such review may be filed more than 
60 days after issuance of the order by the head of the agency. Review 
shall conform to Chapter 7 of Title 5, United States Code.

[FR Doc. 94-29422 Filed 11-30-94; 8:45 am]
BILLING CODE 6820-34-P