52.222-12
Contract Termination-Debarment
Violating key labor standards clauses in construction contracts can lead to contract termination and debarment from future federal work.
Overview
FAR 52.222-12, "Contract Termination-Debarment," establishes that violations of specific labor standards clauses in construction contracts can result in severe consequences, including contract termination and debarment from future government contracts. This clause is inserted into contracts as directed by FAR 22.407(a) and references several key labor compliance requirements, such as wage rates, overtime, payroll records, and the Copeland Act. If a contractor or subcontractor breaches any of these clauses, the government has the authority to terminate the contract and initiate debarment proceedings under 29 CFR 5.12, which can bar the contractor from receiving federal contracts for a specified period.
Key Rules
- Breach of Labor Standards Clauses
- Violations of specified labor standards clauses (e.g., wage rates, overtime, payroll, Copeland Act) are grounds for contract termination and debarment.
- Debarment Authority
- The government may debar contractors and subcontractors under 29 CFR 5.12 for noncompliance with these requirements.
Responsibilities
- Contracting Officers: Must include this clause in applicable contracts and enforce compliance, including initiating termination or debarment if violations occur.
- Contractors: Must comply with all referenced labor standards clauses to avoid termination and debarment.
- Agencies: Oversee compliance and take action in cases of breach, including reporting and processing debarment actions.
Practical Implications
- This clause underscores the importance of strict compliance with labor standards in construction contracts.
- Contractors risk losing current and future government business if they violate these requirements.
- Common pitfalls include improper wage payments, inadequate payroll records, or failure to comply with overtime rules.