Subcommittee on Government Operations Examined the Effects of Shutdowns on Contractors

May 7, 2019
Press Release

Washington, D.C. (May 7, 2019)—This week, the Subcommittee on Government Operations held a field hearing examining the effects the longest ever government shutdown had on federal contract employees. 

TAKEAWAYS

 

  • Potentially, 1.5 million contract employees were affected by the 35-day government shutdown in 2019.  The Subcommittee determined that the shutdown delayed or reduced the volume of new or renewed contracts at affected agencies by 75%, when compared to the previous year.

 

  • David Berteau of the Professional Services Council and Roger Krone of Leidos testified that contract employees, who often work in the same office as federal employees, potentially face additional consequences when their government employer shuts down.  Varied agency policies, contract provisions, contractor capacities, and state laws create cumbersome and inequitable access to assistance for contractors during the shutdown.

 

  • Local small business owners and low-wage contract employees testified that the recent shutdown forced small businesses to lay-off staff, pushed them to choose between life-saving prescriptions and mortgage payments, and made government a less attractive employer and landlord for current and future innovative businesses.

 

  • David Berteau testified that contract employees may lose their security clearances and their eligibility for their jobs, as a result of the financial instability in their personal lives caused by a government shutdown.

 

  • Michael Niggel of Advanced Concepts and Technologies International testified that contractors may receive bad performance grades as a result of a government shutdown, negatively affecting their long-term ability to compete for government contracts.  In some cases, federal contractors get poor performance ratings because they miss deadlines or incur increased costs directly attributable to the shutdown.  

 

  • Congress could take steps to ensure that contractors have shutdown-related provisions written into their contracts, as well as equal access to unemployment insurance, paid time off, or other assistance.

 

  • Members of the Committee have proposed fair and practical ways to provide backpay to certain contractors, including H.R. 339 and H.R. 678.

 

WITNESSES

 

Roger A. Krone

CEO

Leidos

 

Jaime Contreras

Vice President

SEIU 32BJ

 

Alba Alemán

CEO

Citizant

 

Wesley Ford

President

TKI Coffee

 

Ed Grabowski

President, Local 2061

International Association of Machinists and Aerospace Workers

 

David Berteau

President & CEO

Professional Services Council

 

Michael Niggel

CEO

Advanced Concepts & Technologies

 

Mark Hall 
Executive Vice President

ServiceSource

 

Anthony Crescenzo 
Chief Executive Officer

IntelliDyne, LLC

 

Tamela Worthen 
Security Guard

Smithsonian Institution

 

116th Congress