Confidentiality Agreements Reporting Waste, Fraud or Abuse Prohibited

January 27, 2017

New FAR Rule Restricts Employee Confidentiality Agreements

Source: SmallGovCon, Ian Patterson, January 24, 2017

The FAR Council has added a new provision to the FAR to restrict the permissible terms of employee confidentiality agreements.

Effective January 19, 2017, contractors wishing to do business with the federal government will need to certify that they do not limit the ability of their employees to report waste, fraud, or abuse to appropriate government officials.

The final rule creates a new FAR 3.909 and two new FAR clauses, FAR 52.203-18 (Prohibition on Contracting with Entities that Require Certain Internal Confidentiality Agreements or Statements – Representation) and FAR 52.203-19 (Prohibition on Requiring Certain Internal Confidentiality Agreements or Statements). FAR 52.203-18 must be included in almost all solicitations, except those for personal services. There is no exception for commercially available off-the-shelf items or acquisitions below the micro-purchase threshold.

The new rule will apply to any acquisitions with funds appropriated in FY 2015 or later. Additionally, unlike many FAR provisions, a portion of the new rule is retroactive. Contracting Officers are directed to “[m]odify existing contracts, other than personal services contracts with individuals, to include [FAR 52.203-19] before obligating FY 2015 or subsequent FY funds that are subject to the same prohibition on internal confidentiality agreements or statements.” READ MORE….

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