B-178773(2), DEC 6, 1973

B-178773(2): Dec 6, 1973

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WE ARE ENCLOSING A COPY OF OUR LETTER OF TODAY TO LOCKHEED CONCERNING THIS MATTER. WE HAVE DENIED LOCKHEED'S PROTEST. THAT IS. DISAGREES WITH THE DETERMINATION OF A CONTRACTING AGENCY THAT THE SERVICE CONTRACT ACT IS NOT APPLICABLE TO THE PROCUREMENT.

B-178773(2), DEC 6, 1973

ALTHOUGH AIR FORCE ACTED IN GOOD FAITH IN TREATING PROCUREMENT AS SUBJECT TO WALSH-HEALEY ACT AND NOT SERVICE CONTRACT ACT, DEPARTMENT OF LABOR (DOL) SHOULD ISSUE A REGULATION PROVIDING FOR CONTRACT ADJUSTMENT IN CASES WHERE DOL DISAGREES WITH CONTRACTING AGENCY'S DETERMINATION THAT SERVICE CONTRACT ACT DOES NOT APPLY TO PROCUREMENT.

TO MR. SECRETARY:

IN RESPONSE TO THE SEPTEMBER 6, 1973, LETTER FROM YOUR ASSOCIATE SOLICITOR, DIVISION OF GENERAL LEGAL SERVICES, FURNISHING YOUR DEPARTMENT'S VIEWS ON THE PROTEST FILED BY LOCKHEED AIRCRAFT SERVICE COMPANY AGAINST AWARD OF A CONTRACT BY THE AIR FORCE TO E-SYSTEMS, INCORPORATED, WE ARE ENCLOSING A COPY OF OUR LETTER OF TODAY TO LOCKHEED CONCERNING THIS MATTER.

OUR REVIEW OF THE RECORD IN THIS CASE INDICATED THAT THE AIR FORCE ACTED IN GOOD FAITH AND NOT CONTRARY TO ANY LAW OR REGULATION IN TREATING THE PROCUREMENT AS SUBJECT TO THE WALSH-HEALEY ACT RATHER THAN THE SERVICE CONTRACT ACT. FOR THAT REASON, WE HAVE DENIED LOCKHEED'S PROTEST.

WE SHARE YOUR DEPARTMENT'S CONCERNS, HOWEVER, WITH RESPECT TO AFFORDING SERVICE CONTRACT WORKERS THE PROTECTION ENVISIONED BY THE SERVICE CONTRACT ACT. WE NOTE THAT 29 CFR 4.5(C) PROVIDES FOR APPROPRIATE CONTRACT ADJUSTMENT IN CASES IN WHICH CONTRACTING AGENCIES FAIL TO TIMELY NOTIFY YOUR DEPARTMENT OF THEIR INTENT TO AWARD SERVICE CONTRACTS. WE THINK A SIMILAR PROVISION, SPECIFICALLY DEALING WITH THE TYPE OF SITUATION PRESENT IN THIS CASE, THAT IS, IN WHICH YOUR DEPARTMENT, SUBSEQUENT TO CONTRACT AWARD, DISAGREES WITH THE DETERMINATION OF A CONTRACTING AGENCY THAT THE SERVICE CONTRACT ACT IS NOT APPLICABLE TO THE PROCUREMENT, WOULD PROTECT THE WORKERS CONCERNED AND WOULD ALSO PROVIDE FOR AN ORDERLY RESOLUTION OF THIS KIND OF INTER AGENCY DISPUTE WITHOUT THE POTENTIAL DISRUPTION OF THE PROCUREMENT PROCESS. ACCORDINGLY, WE SUGGEST THAT CONSIDERATION BE GIVEN TO THE DEVELOPMENT AND ISSUANCE OF SUCH A PROVISION PURSUANT TO YOUR AUTHORITY UNDER SECTION 4 OF THE SERVICE CONTRACT ACT.