Adventures in Fedcon: Hiring incumbent employees gives rise to two recent, interesting protests

First, @Steven Koprince summarizes an interesting OHA case that caught my eye, Size Appeal of Synergy Solutions, Inc., SBA No. SIZ-5843 (2017).

Here, the unsuccessful incumbent alleged an affiliation between itself and the successful offeror, because the successful offeror proposed hiring 85% of incumbent employees (aka badge-flip). Note these companies were on competing teams; that’s right, essentially the incumbent said the successful offeror’s size should include the incumbent’s revenue, as the proposed badge-flipping created an affiliation. Logic prevailed, as OHA found that two companies competing against each other for a contract are not affiliated. Koprince cautions, however, ostensible subcontractor affiliation cases are intensely fact-specific.”

Second, GAO found the Air Force failed to evaluate professional compensation (“in effect a price realism analysis”) in accordance with 52.222-46 when it “did not reasonably compare [successful offerto’s] salaries to incumbent salaries,” resulting in a successful protest. As GAO points out, “52.222-46(b), offerors are advised that, in recompetitions, ‘proposals envisioning compensation levels lower than those of predecessor contractors for the same work’ require additional evaluation.”

“Here, the record does not reflect that the agency compared ERC’s labor rates to those paid to incumbent personnel.” This protest, sustained on these grounds.

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Jason Bakke
President
Chaedrol LLC
Washington, DC
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