CBCA 5814

THIS OPINION WAS INITIALLY ISSUED UNDER PROTECTIVE ORDER AND IS BEING PUBLICLY RELEASED IN ITS ENTIRETY ON DECEMBER 10, 2019 DENIED: November 1, 2019 CBCA 5814, 5815, 5816 HARRIS IT SERVICES CORPORATION, Appellant, v. DEPARTMENT OF VETERANS AFFAIRS, Respondent. Steven M. Masiello and J. Quincy Stott of Dentons US LLP, Denver, CO, counsel for Appellant. Jason A.M. Fragoso, Office of General Counsel, Department of Veterans Affairs, Washington, DC; and Frank DiNicola, Office of General Counsel, Department of Veterans Affairs, Eatontown, NJ, counsel for Respondent. Before Board Judges DRUMMOND, LESTER, and O’ROURKE. O’ROURKE, Board Judge. Pending before the Board are cross-motions for summary judgment on consolidated appeals to recover back wages paid to employees under the Service Contract Act (SCA), 41 U.S.C. § 6701 (2012). Pursuant to a Department of Labor (DoL) investigation, the contracting officer retroactively incorporated wage determinations into three task orders believed to be staffed with professionals. Appellant seeks reimbursement of its costs under the Changes clause. Because appellant did not comply with the terms of the contract, we grant respondent’s motion for summary judgment and deny the appeals. CBCA 5814, 5815, 5816 2 The Base Contract The Department of Veterans Affairs (VA) established the Transformation Twenty-one Total Technology (T4) contract, a $12 billion indefinite delivery, indefinite quantity (IDIQ) multiple-award task order contract, to modernize information technology (IT) infrastructure at VA facilities worldwide, and to streamline the VA’s acquisition of IT products and services. According to the contract’s performance work statement, T4 contractors were required to perform a wide range of IT services, including systems engineering, modeling and simulation, knowledge management, strategic planning, cyber security, data migration, network administration, enterprise architecture support, web applications design and development, operations and maintenance, coding and unit testing, help desk support, software integration, and equipment installation. In an attachment to the contract, these services were organized into 167 different labor categories and each assigned a designated number. Of the 167 labor categories, 137 required an advanced degree or significant work experience. Most of the remaining positions required an associate’s degree or two years of technical school. Only six positions required a high school diploma or GED. The T4 request for proposals (RFP) required interested contractors to bid these labor categories by proposing fully loaded labor rates for subsequent task order execution. Specific requirements for individual jobs, to include the place of performance, were defined at the task order level and typically involved work across multiple functional areas. Task orders were issued on a time and materials, cost reimbursement, or firm fixed-price basis. Some task orders, including two of the three at issue in this case, were referred to as “hybrid task orders” because they contained both time and materials and firm fixed-price requirements. Procedures for soliciting and awarding task orders required the VA to issue a “request for task execution plan” (RTEP). In response to the RTEP, each interested T4 contractor submitted a “task execution plan” (TEP). TEPs for time and materials task orders required the contractor to reference the T4 labor categories using the Government-designated numbering system. In the event a T4 contractor intended to use DoL labor categories in a particular TEP, the contractor was required to notify the VA, including identifying the county and state where the work would be performed and which DoL labor categories it intended to use. During the T4 solicitation period, interested bidders asked the VA whether it would hold winning contractors to their proposed staffing model and would compare the labor rates CBCA 5814, 5815, 5816 3 of the personnel actually doing the work against the labor rates of the proposed staffing: “It is believed that some companies propose senior level people, only to switch them out with cheaper junior level people when performance starts.” The VA responded: Under [firm fixed-price task orders], the contractor is required to perform successfully and at the proposed price.