52.216-29 Time-and-Materials/Labor-Hour Proposal Requirements—Other Than Commercial Acquisition With Adequate Price Competition
Source: FAR 52.216-29 on acquisition.gov
Offerors must provide comprehensive, clearly structured fixed hourly rates for all labor categories and sources when proposing on non-commercial T&M or Labor-Hour contracts with adequate price competition.
Overview
This FAR provision outlines the proposal requirements for solicitations expected to result in Time-and-Materials (T&M) or Labor-Hour contracts, specifically for acquisitions other than commercial items where adequate price competition exists. It requires offerors to provide fixed hourly rates for labor categories, ensuring these rates are comprehensive and specify whether they apply to the offeror, subcontractors, or related entities. The provision also details acceptable methods for establishing these rates, allowing for separate, blended, or combined approaches for different labor categories and sources.
Key Rules
- Fixed Hourly Rates Requirement
- Offerors must propose fixed hourly rates that include all costs (wages, overhead, G&A, and profit) for each labor category.
- Source Specification
- Offerors must indicate whether each rate applies to their own employees, subcontractors, or divisions/affiliates under common control.
- Rate Structure Options
- Offerors may use separate rates, blended rates, or a combination for each labor category, covering all sources of labor.
Responsibilities
- Contracting Officers: Ensure solicitations include this provision and verify that proposals comply with its requirements.
- Contractors: Prepare proposals with detailed, comprehensive fixed hourly rates and clearly identify the labor source and rate structure.
- Agencies: Oversee compliance and evaluate proposals for adherence to these requirements.
Practical Implications
- This provision ensures transparency and consistency in pricing for T&M/Labor-Hour contracts, reducing ambiguity in labor costs.
- Contractors must carefully structure their proposals to avoid errors in rate application or labor source identification.
- Common pitfalls include failing to include all cost elements in rates or not clearly specifying the labor source for each rate.
As prescribed in 16.601(f)(1), insert the following provision:
Time-and-Materials/Labor-Hour Proposal Requirements—Other Than Commercial Acquisition With Adequate Price Competition (Nov 2021)
(a) The Government contemplates award of a Time-and-Materials or Labor-Hour type of contract resulting from this solicitation.
(b) The offeror must specify fixed hourly rates in its offer that include wages, overhead, general and administrative expenses, and profit. The offeror must specify whether the fixed hourly rate for each labor category applies to labor performed by-
(1) The offeror;
(2) Subcontractors; and/or
(3) Divisions, subsidiaries, or affiliates of the offeror under a common control;
(c) The offeror must establish fixed hourly rates using-
(1) Separate rates for each category of labor to be performed by each subcontractor and for each category of labor to be performed by the offeror, and for each category of labor to be transferred between divisions, subsidiaries, or affiliates of the offeror under a common control;
(2) Blended rates for each category of labor to be performed by the offeror, including labor transferred between divisions, subsidiaries, or affiliates of the offeror under a common control, and all subcontractors; or
(3) Any combination of separate and blended rates for each category of labor to be performed by the offeror, affiliates of the offeror under a common control, and subcontractors.
(End of provision)