Should Contractors Have a Pay Freeze?

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This topic contains 6 replies, has 5 voices, and was last updated by  Henry Brown 6 years, 12 months ago.

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  • #118158

    Steve Ressler
    Keymaster

    Should Contractors Have a Pay Freeze?

    Following President Obama’s recent proposal for a two-year pay freeze for all civilian federal workers, U.S. Energy Secretary Steven Chu announced a pay freeze for Department of Energy contractor employees.

    Article – http://www.fedsmith.com/article/2670/department-energy-announces-it

  • #118170

    Henry Brown
    Participant

    I think they should try! And when all the congressional budget bashers started to scream “oh that is different” let them explain to their bosses ( the electorate ) how it is different

  • #118168

    Jaime Gracia
    Participant

    We could realize enormous savings if agencies, specifically the DoD, stop making improper incentive payments to contractors who have not earned them. That would save an estimated $500M. That’s not walking around money! Don’t get me started on Medicare…

  • #118166

    Elliot Volkman
    Participant

    Pay freeze or not, I was mostly unaware that agencies had direct control over what organizations and how they pay the contractors. Obviously the money comes from the agencies, but is it common for agencies to add in contracts how the primes distribute their funds?

  • #118164

    Noel Dickover
    Participant

    In reply to Elliot whether the USG has control over how contractors dispurse their funds, the answer in most cases is, “Yes, most definitely.” In cost plus contracts, there is actually a percentage amount for pay increases over the life of the award. This is usually the case for Time and Materials as well. However, this is not the case in Firm Fixed Price contracts. The govt is usually not supposed to know the innards of the cost structure for FFP.

    Regardless, for contracts in place, there is no method for the USG to go back and retrofit a “do not give salary increases” clause. Unless I’m sorely mistaken, I really don’t see this as a possibility.

  • #118162

    Elliot Volkman
    Participant

    Thank you so much for clarifying that for me Noel! I assumed that there wasn’t much alteration that could be done with contracts in place, aside from advisement.

  • #118160

    No workers would “freeze to work”

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