This directive was reviewed and certified as current and necessary by (Enter Name),
(Enter Title) Director, Office of Management, Budget and Evaluation/Chief Financial Officer, XX-XX-XXXX. |
| U. S. Department of Energy |
ORDER
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DOE O 350.1 Change 1
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|
Approved:
9-30-96
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| SUBJECT: CONTRACTOR HUMAN RESOURCE MANAGEMENT PROGRAMS | |
1. OBJECTIVES.
a. To establish Department of Energy (DOE) responsibilities, requirements, and cost
allowability criteria for the management and oversight of contractor Human
Resource Management (HR) programs.
b. To ensure that DOE contractors manage their HR programs to support the DOE
mission, promote work force excellence, champion work force diversity, achieve
effective cost management performance, and comply with applicable laws and
regulations.
c. To implement consistent requirements that allow contractors flexibility in
determining how to meet the requirements.
d. To ensure that all elements of cash and non-cash compensation are considered in
the design and implementation of an appropriate total compensation philosophy,
but are not used as a means to deflect needed cost reductions in either or both.
2. CANCELLATIONS. In addition to the Orders listed in the chapters of this Order, the
Orders listed below are canceled. Cancellation of an Order does not, by itself, modify or
otherwise affect any contractual obligation to comply with such an Order. Canceled
Orders incorporated by reference in a contract shall remain in effect until the contract is
modified to delete the reference to the requirements in the canceled Orders.
a. DOE 3220.1A, MANAGEMENT OF CONTRACTOR PERSONNEL POLICIES
AND PROGRAMS, of 5-14-92.
b. DOE 3220.4A, CONTRACTOR PERSONNEL AND INDUSTRIAL
RELATIONS REPORTS, of 1-7-93.
c. DOE 3220.6A, FEDERAL LABOR STANDARDS, of 5-14-92.
d. DOE 3309.1A, REDUCTIONS IN CONTRACTOR EMPLOYMENT, of
11-30-92.
e. DOE 3830.1, POLICIES AND PROCEDURES FOR PENSION PLANS UNDER
OPERATING AND ONSITE SERVICE CONTRACTS, of 8-23-82.
f. DOE 3890.1A, CONTRACTOR INSURANCE AND OTHER HEALTH
BENEFIT PROGRAMS, of 6-12-92.
g. DOE N 3131.1, ACCESS TO SKILLS, KNOWLEDGE AND ABILITIES OF
RETIRED SCIENTISTS AND ENGINEERS FOR THE NUCLEAR WEAPONS
PROGRAM, of 4-28-95.
3. APPLICABILITY.
a. DOE Elements. Except for the exclusions in paragraph 3c, this Order applies to
all DOE Elements.
b. Except for the exclusions in paragraph 3c or as specified in the Applicability
section of this Order's individual chapters, Attachment 1, the Contractor
Requirements Document (CRD) located at the back of each of this Order's
individual chapters, sets forth requirements that are applicable to the universe of
prime cost reimbursement contracts for the management and operation of DOE-
owned or DOE-leased facilities and other contracts and sub-contracts as identified
in the specific chapters of this Order. Applicability to other designated long-lived
onsite contracts is optional at the discretion of Departmental and Field Elements.
Contractor compliance with the CRD will be required to the extent set forth in a
contract. Contractors shall be directed to continue to comply with the
requirements of orders canceled by this Order until their contracts are modified to
delete the reference to the requirements of the canceled orders.
c. Exclusions.
(1) Specific exclusions, if applicable, are identified in the Applicability section
of each of this Order's individual chapters.
(2) Activities that are regulated through a license by the Nuclear Regulatory
Commission (NRC) or a State under an Agreement with the NRC,
including activities certified by the NRC under section 1701 of the Atomic
Energy Act; [same as section 830.2(a)].
(3) Activities conducted under the authority of the Director, Naval Nuclear
Propulsion Program, as described in Public Law 98-525; [same as section
830.2(b)].
4. REQUIREMENTS. Requirements are set forth in Chapters I through IX of this Order.
5. RESPONSIBILITIES. Assignments of responsibility are set forth in Chapters I through
IX of this Order.
6. REFERENCES. Applicable references are listed in Chapters I through IX of this Order.
7. CONTACT. See Chapters I through IX for the appropriate contacts.
BY ORDER OF THE SECRETARY OF ENERGY:
ARCHER L. DURHAM
Assistant Secretary for
Human Resources and Administration
TABLE OF CONTENTS
CHAPTER I - LABOR RELATIONS
1. Objectives . . . . . . . . . . . . . . . . . . . . .I-1
2. Applicability. . . . . . . . . . . . . . . . . . . .I-1
3. Requirements . . . . . . . . . . . . . . . . . . . .I-1
4. Responsibilities . . . . . . . . . . . . . . . . . .I-1
a. Director, Office of Work and Community TransitionI-1
b. Heads of Contracting Activities . . . . . . . .I-2
5. References . . . . . . . . . . . . . . . . . . . . .I-2
6. Contact. . . . . . . . . . . . . . . . . . . . . . .I-3
Attachment 1 - Contractor Requirements Document . . . . .I-5
CHAPTER II - LABOR STANDARDS
1. Objectives . . . . . . . . . . . . . . . . . . . . II-1
2. Applicability. . . . . . . . . . . . . . . . . . . II-1
3. Requirements . . . . . . . . . . . . . . . . . . . II-1
4. Responsibilities . . . . . . . . . . . . . . . . . II-1
a. Director, Office of Worker and Community TransitionII-1
b. Heads of Contracting Activities . . . . . . . II-2
5. References . . . . . . . . . . . . . . . . . . . . II-3
6. Contact . . . . . . . . . . . . . . . . . . . . . II-4
Attachment 1 - Contractor Requirements Document . . . . II-5
CHAPTER III - REDUCTIONS IN CONTRACTOR EMPLOYMENT
1. Objectives . . . . . . . . . . . . . . . . . . . .III-1
2. Applicability. . . . . . . . . . . . . . . . . . .III-1
3. Requirements . . . . . . . . . . . . . . . . . . .III-1
4. Responsibilities . . . . . . . . . . . . . . . . .III-2
a. The Secretary . . . . . . . . . . . . . . . .III-3
b. Director, Office of Worker and Community TransitionIII-3
c. Heads of Field Elements . . . . . . . . . . .III-3
5. References . . . . . . . . . . . . . . . . . . . .III-5
6. Contact. . . . . . . . . . . . . . . . . . . . . .III-5
Attachment 1 - Contractor Requirements Document . . . .III-7
CHAPTER IV - COMPENSATION
1. Objective. . . . . . . . . . . . . . . . . . . . . IV-1
2. Applicability . . . . . . . . . . . . . . . . . . .IV-1
3. Requirements . . . . . . . . . . . . . . . . . . . IV-1
4. Responsibilities . . . . . . . . . . . . . . . . . IV-1
a. Deputy Assistant Secretary for Procurement and AssistanceIV-1
Management
b. Heads of Contracting Activities . . . . . . . IV-1
5. References . . . . . . . . . . . . . . . . . . . . IV-2
6. Contact. . . . . . . . . . . . . . . . . . . . . . IV-2
Attachment 1 - Contractor Requirements Document . . . . IV-3
Attachment 2 - DOE F 3220.8 . . . . . . . . . . . . . . IV-7
Attachment 3 - DOE F 3220.5 . . . . . . . . . . . . . . IV-9
Attachment 4 - DOE F 3230.6a. . . . . . . . . . . . . .IV-11
Attachment 5 - DOE F 3220.6B. . . . . . . . . . . . . .IV-13
CHAPTER V - BENEFITS
1. Objective. . . . . . . . . . . . . . . . . . . . . .V-1
2. Applicability. . . . . . . . . . . . . . . . . . . .V-1
3. Requirements . . . . . . . . . . . . . . . . . . . .V-1
4. Responsibilities . . . . . . . . . . . . . . . . . .V-1
a. Deputy Assistant Secretary for Procurement and AssistanceV-1
Management
b. Heads of Contracting Activities . . . . . . . .V-2
5. References . . . . . . . . . . . . . . . . . . . . .V-4
6. Contact. . . . . . . . . . . . . . . . . . . . . . .V-4
Attachment 1 - Contractor Requirements Document . . . . .V-5
Attachment 2 - Report of Contractor Expenditures For Employee SupplementaryV-11
Compensation
CHAPTER VI - PENSIONS
1. Objectives . . . . . . . . . . . . . . . . . . . . VI-1
2. Applicability. . . . . . . . . . . . . . . . . . . VI-1
3. Requirements . . . . . . . . . . . . . . . . . . . VI-1
4. Responsibilities . . . . . . . . . . . . . . . . . VI-1
a. Director, Office of Contractor Management and AdministrationVI-1
b. Heads of Contracting Activities . . . . . . . VI-2
c. Cognizant Contracting Officers. . . . . . . . VI-2
d. General Counsel . . . . . . . . . . . . . . . VI-2
5. References . . . . . . . . . . . . . . . . . . . . VI-2
6. Contact. . . . . . . . . . . . . . . . . . . . . . VI-3
Attachment 1 - Contractor Requirements Document . . . . VI-5
Attachment 2 - Definitions. . . . . . . . . . . . . . .VI-11
CHAPTER VII - DOE CONTRACTOR RISK MANAGEMENT AND
LIABILITY PROGRAMS
1. Objectives . . . . . . . . . . . . . . . . . . . .VII-1
2. Applicability. . . . . . . . . . . . . . . . . . .VII-1
3. Requirements . . . . . . . . . . . . . . . . . . .VII-1
4. Responsibilities . . . . . . . . . . . . . . . . .VII-1
a. Director, Office of Contractor Management and AdministrationVII-1
b. Heads of Contracting Activities (HCA) . . . .VII-2
c. Cognizant Contracting Officers. . . . . . . .VII-2
5. References . . . . . . . . . . . . . . . . . . . .VII-2
6. Contact. . . . . . . . . . . . . . . . . . . . . .VII-3
Attachment 1 - Contractor Requirements Document . . . .VII-5
Attachment 2 - Additional Guidance. . . . . . . . . . .VII-9
Attachment 3 - Contractor Liability Scenarios . . . . VII-11
Attachment 4 - Definitions. . . . . . . . . . . . . . VII-13
CHAPTER VIII - CONTRACTOR WORKPLACE SUBSTANCE ABUSE PROGRAMS
1. Objectives . . . . . . . . . . . . . . . . . . . VIII-1
2. Applicability. . . . . . . . . . . . . . . . . . VIII-1
3. Requirements . . . . . . . . . . . . . . . . . . VIII-1
4. Responsibilities . . . . . . . . . . . . . . . . VIII-1
a. Assistant Secretary for Defense Programs. . VIII-1
b. Assistant Secretary for Environment, Safety and HealthVIII-2
c. Deputy Assistant Secretary for Procurement and AssistanceVIII-2
Management
d. Director, Office of Nonproliferation and National SecurityVIII-2
e. Heads of Contracting Activities . . . . . . VIII-2
5. References . . . . . . . . . . . . . . . . . . . VIII-3
6. Contact. . . . . . . . . . . . . . . . . . . . . VIII-3
Attachment 1 - Contractor Requirements Document . . . VIII-5
CHAPTER IX - EMPLOYEE ASSISTANCE PROGRAMS
1. Objectives . . . . . . . . . . . . . . . . . . . . IX-1
2. Applicability. . . . . . . . . . . . . . . . . . . IX-1
3. Requirements . . . . . . . . . . . . . . . . . . . IX-1
4. Responsibilities . . . . . . . . . . . . . . . . . IX-1
a. Deputy Assistant Secretary for Procurement and AssistanceIX-1
Management
b. Assistant Secretary for Environment, Safety and Health, Office ofIX-1
Occupational Medicine and Medical Surveillance
c. Heads of Contracting Activities . . . . . . . IX-1
5. References . . . . . . . . . . . . . . . . . . . . IX-1
6. Contact. . . . . . . . . . . . . . . . . . . . . . IX-2
Attachment 1 - Contractor Requirements Document . . . . IX-3
CHAPTER I
LABOR RELATIONS
1. OBJECTIVES.
a. To ensure that Department of Energy management and operating contractors
pursue collective bargaining practices that promote efficiency and economy in
contract operations, judicious expenditure of public funds, equitable resolution of
disputes, and effective collective bargaining relationships.
b. To achieve full consultation with management and operating contractors prior to
contract negotiations and during the term of a contract on matters that may have a
significant impact on work rules, make-or-buy decisions, or past customs and
practices.
2. APPLICABILITY. Contractors. This chapter applies to prime contractors that perform
work under prime contracts at DOE-owned installations to the extent set forth in the
prime contract. Contractor requirements are set forth in Attachment 1 to this chapter.
3. REQUIREMENTS.
a. DOE retains absolute authority on all questions of security, security rules, and their
administration. However, to the fullest extent feasible, DOE shall consult with
representatives of management and labor in formulating security rules and
regulations that affect the collective bargaining process.
b. DOE shall not take a public position concerning the merits of a labor dispute
between a contractor and its employees or organizations representing those
employees.
4. RESPONSIBILITIES.
a. Director, Office of Worker and Community Transition.
(1) Establishes DOE labor relations policy in consultation with field
organizations.
(2) Represents DOE Headquarters on all matters involving contractor labor
relations issues. This includes:
(a) informing DOE senior management of significant labor relations
developments,
(b) acting as DOE liaison to other government agencies and to
international unions and their representatives,
(c) serving as a clearing house for labor relations information,
(d) coordinating union representation at meetings and conferences
initiated by DOE Headquarters elements; and
(e) approving all DOE policy affecting contractor labor relations.
(3) Works with DOE program offices that originate or change qualification
standards, testing requirements, or other programs that may affect
conditions of employment for contractor employees to ensure that they are
developed and/or implemented consistent with collective bargaining
requirements.
b. Heads of Contracting Activities.
(1) Review collective bargaining issues with contractors and reach agreement
on economic parameters prior to commencement of negotiations.
(2) Consult regularly with contractors during the term of collective bargaining
agreements to stay abreast of matters of interest and concern to DOE.
(3) Serve as DOE liaison to regional governmental agencies and offices and to
regional union officials.
(4) Notify the Office of Worker and Community Transition of National Labor
Relations Board charges and any significant labor relations issues.
(5) Provide timely information and advice to DOE Headquarters and others
concerning local contractor labor issues and arbitration decisions.
5. REFERENCES.
a. Federal Acquisition Regulation (FAR), Subpart 22.1, BASIC LABOR POLICIES,
which provides guidance to contracting officers on labor relations matters.
b. Department of Energy Acquisition Regulation (DEAR), Subpart 970.22,
APPLICATION OF LABOR POLICIES, which provides DOE guidance to
contracting officers on labor relations matters.
c. DEAR 970.3102-2(e), which addresses allowability of compensation costs.
6. CONTACT. Office of Worker and Community Transition, at (202) 586-7550.
CONTRACTOR REQUIREMENTS DOCUMENT
LABOR RELATIONS
The following requirements apply to prime contractors that perform work under cost
reimbursement contracts at DOE-owned installations to the extent set forth in the prime contract.
1. Develop and implement labor relations policies that will promote orderly collective
bargaining relationships, equitable resolution of disputes, efficiency and economy in
operations, and the judicious expenditure of public funds.
2. Consult with the contracting officer prior to and during the course of negotiations with
labor unions, and during the term of resultant contracts, on economic issues and other
matters that have a potentially significant impact on work rules, make-or-buy decisions, or
other matters that may cause a significant deviation from past customs or practices.
3. Provide the contracting officer with a settlement summary within 30 to 60 days after
formal ratification of the agreement, using the "Report of Settlement" form.
4. Immediately advise the DOE Field Element of the following:
a. Possible strike situations or other job actions affecting the continuity of operations;
in the event of work stoppage, the contractor is responsible for completing Bureau
of Labor Statistics (BLS) Form 817 and forwarding two copies to the DOE Field
Element.
b. Formal action by the National Labor Relations Board or the National Mediation
Board (copies of the Board correspondence shall be provided to the Field
Element).
c. Recourse to procedures under the Labor-Management Relations Act of 1947, as
amended, or any other federal or state law.
d. Any grievance scheduled for arbitration under a collective bargaining agreement
that has the potential for significant economic or other impact.
e. Other significant issues that may involve review by other federal or state agencies.
CHAPTER II
LABOR STANDARDS
1. OBJECTIVES.
a. To ensure that applicable labor standards are included in all Department of Energy
contracts and subcontracts.
b. To cooperate with the Department of Labor, as appropriate, to:
(1) obtain information,
(2) provide complete and timely reports, and
(3) exercise oversight responsibility to ensure contractor compliance with applicable
laws.
2. APPLICABILITY. This Chapter is applicable to all DOE Elements responsible for the
management of contracts for prime contractors of the Department's government owned
facilities.
3. REQUIREMENTS. Proposed acquisition and designated contractor work packages shall
be reviewed to determine the applicability of the Davis-Bacon Act and/or the Service Contract
Act; work shall be accomplished in accordance with such determinations.
4. RESPONSIBILITIES.
a. Director, Office of Worker and Community Transition.
(1) Coordinates Departmental comments on proposed revisions to Department of
Labor regulations and provides interpretations of final revisions to Headquarters
and field elements.
(2) Prepares and submits the Davis-Bacon Semi-Annual Enforcement Report to the
Department of Labor by April 30 and October 30.
(3) By April 10 of each year, submits to the Administrator, Wage and Hour Division,
Department of Labor, a consolidated annual forecast of construction programs,
which is required by Department of Labor All Agency Memorandum No. 144.
(4) Coordinates responses to Congress and the Department of Labor on labor
standards complaints on acquisitions administered by Headquarters.
b. Heads of Contracting Activities.
(1) Establish Labor Standards Committees to advise contracting officers on the
applicability of the various labor standards statutes to contracts and proposed work
packages.
(2) Review the SF-98 and SF-98a, Notice of Intention to Make a Service Contract and
Response Notice, to ensure that the contemplated work is appropriately covered by
the Service Contract Act and that forms are prepared properly. Forwards such
forms to the Department of Labor.
(3) Advise Director of Worker and Community Transition of complaints and significant
labor standards violations generated by contractor employees and others.
(4) Ensure that all contracts contain the appropriate labor standards provisions.
(5) Ensure that bidders and contractors are provided with applicable labor standards
information and that, where necessary, conferences and contract orientation
meetings are held for solicitations or contracts.
(6) Assist the Department of Labor in preparing for a hearing on and/or investigating
any alleged violations or disputes on alleged violations.
(7) For Service Contract Act covered contracts in excess of $10,000.00, furnish
Standard Form 279, Federal Procurement Data System Individual Contract Action
Report, or its equivalent, to the Federal Procurement Data System (see 29 CFR
4.8).
(8) Request Davis-Bacon Act project wage determinations from the Department of
Labor on the SF-308, Request for Determination and Response to Request for
instances in which general area decisions are not available or are not appropriate to
the DOE site or job. Accordingly, submit wage data to the Department of Labor.
(9) Ensure payroll and job-site audits are conducted as may be necessary to determine
compliance with the Davis-Bacon Act..
(10) Investigate complaints under the Davis-Bacon Act to determine compliance and
proceed as follows:
(a) If no violation is discovered, advise the complainant of the reasons for the
conclusion.
(b) If a violation is discovered:
1 determine the amount of back wages, fringe benefits, and overtime pay due
each employee, and request the contractor to make restitution;
2 determine the amount of liquidated damages due, if any, and request the
contractor to make restitution;
3 withhold sufficient funds to compensate employees and to cover any
liquidated damages that may be due when the contractor does not agree
with the findings and refuses to make restitution;
4 furnish an enforcement report to the Administrator, Wage and Hour
Division, Department of Labor within 60 days after completion of an
investigation where the Davis-Bacon Act underpayments by a contractor
totals $1,000.00 or more; there is reason to believe the violations are
willful; the contractor does not agree with the findings and refuses to make
restitution; or the Department of Labor requested the investigation;
5 ensure that funds withheld to compensate employees for back wages are
forwarded to the Comptroller General for disbursement if restitution has
not been made.
(11) Prepare and submit the Davis-Bacon Semi-Annual Enforcement Report to the
Director, Office of Worker and Community Transition, by April 21 and October 21
of each year.
5. REFERENCES.
a. Federal Acquisition Regulations (FAR), Subpart 22.4, LABOR STANDARDS FOR
CONTRACTS INVOLVING CONSTRUCTION, which explains the applicability of the
Davis-Bacon Act.
b. Federal Acquisition Regulations (FAR), Subpart 22.10, SERVICE CONTRACT ACT
OF 1965, AS AMENDED, which explains the applicability of the Service Contract Act.
c. Department of Energy Acquisition Regulation 970.2273, ADMINISTRATIVE
CONTROLS AND CRITERIA FOR APPLICATION OF THE DAVIS-BACON ACT
IN OPERATIONAL OR MAINTENANCE ACTIVITIES.
6. CONTACT. Office of Worker and Community Transition, at (202) 586-7550.
CONTRACTOR REQUIREMENTS DOCUMENT
LABOR STANDARDS
The following requirements apply to contractors who perform work subject to the Davis-Bacon
Act and the Service Contract Act.
1. Request labor standards coverage determinations from the contracting officer by submitting
proposed work authorizations for contracts in excess of $2,000 for construction, alteration, or
repair, including painting and decorating, of public buildings and public works that involve the
employment of laborers and mechanics. (See FAR 22.401 for definition of terms.)
2. Accomplish work tasks in accordance with the labor standards determination.
3. Ensure that subcontractors comply with the Davis-Bacon Act and conduct payroll and job-site
audits as requested or authorized by the Head of Contracting Activity.
4. Maintain accurate and complete Davis-Bacon Act payrolls for 3 years from completion of
contract when performing as the construction contractor.
5. Post in a prominent job-site location the following Department of Labor Publications.
a. WH-1321, Notice to Employees Working on Federal or Federally Financed Construction
Projects.
b. WH-1313, Notice to Employees Working on Government Contracts.
6. Prepare Standard Form 98, "Notice of Intention to Make a Service Contract and Response to
Notice" for all subcontracts subject to the Service Contract Act and forward to the
contracting officer.
7. Provide information requested by the Head of Contracting Activity for its responses to
inquiries received from Congress and Headquarters.
8. Provide information requested by the Head of Contracting Activity for its reporting
requirements.
CHAPTER III
REDUCTIONS IN CONTRACTOR EMPLOYMENT
1. OBJECTIVES.
a. To perform work force planning that ensures continued availability of critical knowledge,
skills, and abilities required for the Department's mission; and supports a schedule of
work force restructuring actions that minimizes the impacts on programmatic activities.
b . To provide reasonable notice to employees, their representatives, public officials, and
other stakeholders of necessary reductions in contractor employment, and to consult with
them in planning for work force restructuring.
c. To the extent practicable, to minimize reductions at DOE defense nuclear facilities and
other facilities through retraining efforts. If retraining is not feasible, consider early
retirement, attrition, and other options that minimize layoffs.
d. To provide assistance to communities in reducing the impact of employment reductions.
2. APPLICABILITY. This chapter applies to prime contractors and their integrated
subcontractors that perform work at DOE-owned installations to the extent set forth in the
prime contract.
3. REQUIREMENTS.
a. In compliance with Section 3161 of the National Defense Authorization Act for Fiscal
Year 1993 and Secretarial policy, a work force restructuring plan at defense nuclear
facilities and other DOE facilities shall be prepared whenever the DOE determines that a
change in the work force is necessary. Plans may be developed for multiple years, but the
requirement for a plan is triggered when the planned change affects 100 or more
employees at a site within a 12-month period, or when the Head of the Field Element
determines that a change in the work force will significantly affect the community. In
instances where fewer than 100 employees are affected, the objectives of section 3161
shall be applied as feasible.
b. Work force restructuring plans shall be prepared in accordance with "Interim Planning
Guidance for Contractor Work Force Restructuring," published in the Federal Register
Vol. 61, No. 44, dated March 5, 1996, as amended from time to time (Attachment 2).
c. For defense nuclear facilities, work force restructuring plans and implementation reports
shall be submitted to the Secretary, who will approve/disapprove them for delivery to
Congress. For other DOE facilities, delivery of a work force restructuring plan to
Congress is at the discretion of the Secretary.
d. Annual implementation reports shall be submitted by Field Elements to the Office of
Worker and Community Transition that include the following information:
(1) Data on the retained worker force and its ability to meet mission requirements.
(2) Data on workers whose positions were eliminated and who were reassigned to
other work at the site and a description of training provided to achieve such
placements, including training costs.
(3) Data comparing the number of workers separated voluntarily and involuntarily and
costs associated with each category of benefits provided to them, including
estimates of such costs that were included in the work force restructuring plan.
(4) The contractor's statement as to whether adverse EEO impact resulted from
involuntary separations. If affirmative, its extent, business necessity, and a
description of the efforts taken to prevent it.
(5) An evaluation of plan implementation.
(6) Detailed guidance on submitting this information will be provided by the Office of
Worker Community Transition.
e. The Department must have ready access to retired scientists and engineers who may be
needed on a part-time basis to support the Department's nuclear weapons program. The
Department will maintain a list of individually identified retirees, including an affirmation
of their agreement to be members of the retiree corps and necessary identification
information to ensure ready access. The purposes for such access include archiving
technical information, data and recollections not available from the active work force in
areas related to weapons disassembly and nuclear weapons testing; assisting stockpile
stewardship activities as required; and training replacement scientists and engineers.
Access to members of the corps will not be restricted by other policies of DOE or within
the control of DOE unless explicitly agreed to by the Secretary of Energy, and members
of the retiree corps will maintain their security clearances for as long as they are in the
retiree corps program. Further, inclusion in the corps will not amend, abrogate, or affect
any retirement annuity with regard to any DOE-imposed restrictions on such annuity.
4. RESPONSIBILITIES.
a. The Secretary.
(1) Approves/disapproves work force restructuring plans that are submitted to
Congress.
(2) Approves/disapproves notifications of reductions in force of more than 100
employees at a single site.
(3) Submits work force restructuring plans and updates (implementation reports) to
Congress.
b. Director, Office of Worker and Community Transition.
(1) Provides direction and guidance in the development and implementation of work
force restructuring plans and the implementation of economic development plans
when a community is significantly affected by changes in the work force.
(2) Recommends to the Secretary for approval Work Force Restructuring Plans that
are submitted to Congress.
(3) Approves/disapproves work force restructuring actions which do not require
Secretarial approval, including programs to minimize lay offs. Coordinates review
with the affected program office and with General Counsel, Field Management, and
Human Resources and Administration.
(4) Coordinates notifications to Congress with Heads of Field Elements and with the
Assistant Secretary for Congressional and Intergovernmental Affairs.
(5) Performs other tasks that are assigned to the Office of Worker and Community
Transition (WT-1) in Attachment 2.
c. Heads of Field Elements.
(1) Oversee the management of work force changes consistent with direction from the
Office of Worker and Community Transition, Section 3161 of the National Defense
Authorization Act for Fiscal Year 1993 and Department of Energy Interim Planning
Guidance for Contractor Work Force Restructuring, Federal Register Vol. 61, No.
44, pp. 8593 - 8602 (March 5, 1996), as may be amended from time to time.
(2) Prepare site-specific work force restructuring plans (and update them annually by
means of implementation reports) in accordance with guidance contained in
Department of Energy Interim Planning Guidance for Contractor Work Force
Restructuring, Federal Register Vol. 61, No. 44, pp. 8593 - 8602 (March 5, 1996),
as may be amended from time to time.
(3) Obtain approval of separation incentives beyond those expressly authorized by
contract from WT-1 early in the planning process and submit a final work force
restructuring plan to WT-1 as early as practicable.
(4) Establish a baseline employment data base for use in preparing work force analyses
and work force restructuring plans; provide quarterly reports on the data base to
the Office of Worker and Community Transition.
(5) Provide the following notifications upon WT-1 approval.
(a) General Notification to Employees prior to any public announcement and,
where possible, 120 days prior to the involuntary separation of any employee.
(b) Notification to the Public. Coordinate with the Office of Worker and
Community Transition any general announcement describing work force
changes at the site and the estimated number of affected positions.
(c) Notification to Individual Employees. Ensure that contractors provide 60-day
notification if the Work Force Adjustment and Retraining Notification
(WARN) Act applies. If it does not apply, contractors shall provide individual
employees as much notice of involuntary separation as is practicable, but not
less than 2 weeks or 2 weeks pay in lieu of notice.
(6) For work force reductions requiring only contracting officer or his designee
approval, ensure the following are notified prior to the involuntary separation other
than for cause of 10 or more employees.
(a) Affected national and local unions.
(b) State and local governments.
(c) Congressional delegation.
(7) Develop mechanisms to ensure that hiring preferences are being honored by all
prime contractors and designated subcontractors. Requirements shall address
employee responsibilities as well as use of the DOE automated Job Opportunity
Bulletin Board System (JOBBS).
(8) Maintain a list of individually identified retired scientists and engineers who will
comprise a retiree corps to assure ready access to those whose skills may be needed
on a part time basis to support the Department's Nuclear Weapons Program.
5. REFERENCES.
a. Worker Adjustment and Retraining Notification Act, Public Law 100-379 (August 4,
1988).
b. Section 3161 of the National Defense Authorization Act for Fiscal Year 1993 (Public
Law 102-484).
c. Department of Energy Interim Planning Guidance for Contractor Work Force
Restructuring, Federal Register Vol.61, No.44, pp. 8593 - 8602 (March 5, 1996).
6. CONTACT. Office of Worker and Community Transition, at (202) 586-7550.
CONTRACTOR REQUIREMENTS DOCUMENT
REDUCTIONS IN CONTRACTOR EMPLOYMENT
1. Contractors will regularly analyze work force requirements consistent with mission and
will develop appropriate work force transition strategies coinciding with restructuring
objectives consistent with DOE Interim Planning Guidance for Contractor Work Force
Restructuring, Federal Register, Vol. 61, No. 44, pp. 8593-8602 (March 5, 1996) as may
be amended from time to time.
2. Where a change in the nature or structure of a contractor's work force may affect 100 or
more employees at a site within a 12-month period, the contractor shall provide such
information as directed by the contracting officer or his designee to enable compliance
with section 3161 of the National Defense Authorization Act for Fiscal Year 1993; DOE
Interim Planning Guidance for Contractor Work Force Restructuring Federal Register vol.
61, no. 44, pp 8593-8602 (March 5, 1996) , as may be amended from time to time; and
Chapter III of DOE Order 350.1.
3. Provide notifications to employees, the public, and stakeholders in accordance with a
schedule approved by the contracting officer or his designee.
4. Extend preferences, to the extent practicable, in filling vacancies in their work force to
employees terminated from a defense nuclear facility. Guidance for this program is
contained in section V of Department of Energy Interim Planning Guidance for Contractor
Work Force Restructuring, Federal Register Vol. 61, No. 44, pp. 8593 - 8602 (March 5,
1996), as may be amended from time to time.
5. Notify the contracting officer or his designee of any work force reduction that involves the
involuntary separation of 10 or more employees at least 10 work days prior to such
separations. The notification shall include affected job classifications, numbers of
employees affected, and actions taken to assist the employees find other employment or
otherwise lessen the impact of the involuntary separation.
CHAPTER IV
COMPENSATION
1. OBJECTIVE. To ensure that contractors develop and administer compensation programs
that will attract and retain competent and productive employees and that facilitate
achievement of objectives and business strategies in support of DOE missions in a cost
effective manner.
2. APPLICABILITY. This chapter is applicable to all DOE Elements responsible for
management of contracts for the management and operation of the Department's facilities.
3. REQUIREMENTS. Reasonableness and allowability of compensation under contracts to
manage and operate DOE facilities shall be determined in accordance with the cost principles
at DEAR 970.3102-2, and with either the clause "Allowable Costs and Fixed Fee"
(management and operation contracts, DEAR 970.5204-13) or the clause "Allowable Costs
and Fixed Fee" (support contracts, DEAR 970.5204-14) and shall be determined for all other
contracts in accordance with the guidelines at FAR 31.205-6.
4. RESPONSIBILITIES.
a. Deputy Assistant Secretary for Procurement and Assistance Management. Establishes
Department Performance Objectives for contractor employee compensation programs,
and in consultation with the cognizant program officer, approves the initial compensation
and any changes in compensation for each contractor's top official.
b. Heads of Contracting Activities.
(1) Approve the initial compensation program design, including application of parent
organization policies and practices, and appraise its implementation at least once
during the term of the contract; that appraisal shall be within 2 years when there has
been a successor contractor.
(2) Approve the following prior to DOE reimbursement under the contract.
(a) Compensation increase plan.
(b) Individual compensation (including stipends, if any) of those contractor
employees identified by the Head of Contracting Activity as among those who
report directly to the contractor's top official (e.g., General
Manager/Director).
(c) Incentive plan if such a plan is established.
(d) The annual Overtime Control Plan.
(3) Ensure there are procedures in place to verify the accuracy of the Contractor
Executive Compensation Report and the Annual Contractor Salary-Wage Increase
Expenditure Report and the reports are forwarded to the Office of Contractor
Human Resource Management for applicable contractors.
(4) Develop performance measures and related incentives for performance based
contracts to achieve Department objectives in management of contractor employee
compensation and use of overtime.
(5) Ensure the personnel responsible for accomplishing 4.b.(1) through (4) above, have
the skills, knowledge and abilities to meet these responsibilities or receive sufficient
training to do so.
5. REFERENCES.
a. Federal Acquisition Regulations 31.205-6, COMPENSATION FOR PERSONAL
SERVICES.
b. Department of Energy Acquisition Regulations 970.3102-2, COMPENSATION FOR
PERSONAL SERVICES.
6. CONTACT. Office of Contractor Human Resource Management, at (202) 586-9008.
CONTRACTOR REQUIREMENT DOCUMENT
COMPENSATION
Contractors shall submit to the Contracting Officer for approval the following documents.
1. A description of the compensation program supported by relevant data comparing it to other
industry or relevant benchmark programs and including the following components.
a. Philosophy and strategy for all pay delivery programs.
b. System for establishing a job worth hierarchy.
c. Method for relating internal job worth hierarchy to external market.
d. System that links individual and/or group performance to compensation decisions.
e. Method for planning and monitoring the expenditure of funds.
f. Method for ensuring compliance with applicable laws and regulations.
g. System for communicating the programs to employees.
h. System for internal controls and self-assessment.
i. System to ensure that reimbursement of compensation, including stipends, for employees
who are on joint appointments with a parent or other organization shall be on a pro-rated
basis.
2. Proposed major compensation program design changes for approval prior to implementation.
3. Annual Compensation Increase Plan and reports as follows.
a. The Compensation Increase Plan (CIP) should include the following components and
data:
(1) Comparison of average pay to market average pay.
(2) Information regarding surveys used for comparison.
(3) Aging factors used for escalating survey data and supporting information.
(4) Projection of escalation in the market and supporting information.
(5) Information to support proposed structure adjustments, if any.
(6) Analysis to support special adjustments.
(7) Funding requests for each pay structure to include breakouts of merit, promotions,
variable pay, special adjustments, and structure movement.
(a) The proposed plan totals shall be expressed as a percentage of the payroll for
the end of the previous plan year.
(b) All pay actions granted under the compensation increase plan are fully charged
when they occur regardless of time of year in which the action transpires and
whether the employee terminates before year end.
(c) Specific payroll groups (e.g., exempt, nonexempt) for which CIP amounts are
intended shall be defined by mutual agreement between the contractor and the
Contracting Officer.
(d) The Contracting Officer may adjust the CIP amount after approval based on
major changes in factors that significantly affect the plan amount (for example,
in the event of a major reduction in force or significant ramp-up).
(8) A discussion of the impact of budget and business constraints on the CIP amount.
(9) Comparison of pay to relevant factors other than market average pay.
b. An annual Contractor Salary-Wage Increase Expenditure Report (see attached form) to
include, at a minimum, breakouts for merit, promotion variable pay, special adjustments,
and structure movements for each pay structure showing actual against approved
amounts.
4. Individual compensation actions, as required in the contract, and compensation reports as
follows:
a. Initial and proposed changes to base salary and/or payments under an Executive Incentive
Plan for all positions requiring Contracting Officer approval prior to reimbursement. The
contractor shall provide supporting justification related to internal and external equity as
well as individual performance; for each initial compensation or change the contractor
shall submit the Application for Contractor Compensation Approval Form (see attached
form).
b. The semiannual Report of Compensation (see attached forms) which includes:
(1) subtotal dollar amounts for exempt and nonexempt employees and
(2) individual compensation by employee name, position, and amount for each direct
report to the top official and individual compensation at $100,000 and above.
5. Any proposed establishment of an incentive compensation plan, must be budget neutral. Such
proposal must contain:
a. the design of the incentive compensation plan, the funding methodology, and linkage to
contract performance measures;
b. requirement for approval of incentive compensation plan design changes by the
Contracting Officer prior to implementation;
c. requirement for an annual approval, prior to the performance period, of the total dollar
amount of the pool, the eligible positions, and contract performance goals;
d. requirement for policy that provides a specific passover rate, i.e., percent of participants
who will not receive an incentive;
e. requirement for an annual summary report on distributions made under an Incentive
Compensation Plan; and
f. requirement for pay at risk.
6. Annually, an overtime control plan and semiannual Report on Overtime Use, if any of the
following criteria are met: the contractor's overtime expenditures as a percent of payroll
exceed the DOE contractor median overtime expenditures for the preceding calendar year
plus two percent; the contractor's overtime as a percent of payroll exceeds the DOE
contractor median overtime expenditures for the proceeding calendar year and the
contractor's policy permits payment of overtime for exempt employees earning greater than or
equal to $45,000 per annum; or the contractor's overtime as a percent of payroll exceeds the
DOE contractor median overtime expenditures for the preceding calendar year and the
contractor provides for overtime premium pay on any other basis than for hours worked in
excess of 40 hours per week.
a. The overtime control plan must strike a balance between use of other alternatives,
including the hire of additional personnel in a workplace that is safe and promotes the
health of employees. This plan must include:
(1) the institutional overtime premium fund (maximum dollar amount) negotiated
annually;
(2) specific controls for casual overtime for non-exempt employees;
(3) prohibition of casual overtime for exempt employees except as stipulated in an
advance understanding;
(4) an evaluation of alternatives to the use of overtime; and
(5) a requirement for the Contracting Officer to approve any additional overtime
premium funds or plan changes required for mission requirements not included in
the approved plan.
b. The semiannual Report on Overtime Use including:
(1) total cost of overtime;
(2) total cost of straight-time;
(3) overtime cost as a percentage of straight-time cost;
(4) total overtime hours;
(5) total straight-time hours; and
(6) overtime hours as a percentage of straight-time hours.
DOE F 3220.8 - Contractor Salary-Wage Increase Expenditure Report
DOE F 3220.5 - Application For Contractor Compensation Approval
DOE-F-3230.6a - Report Of Compensation
Part 1 - Individual Compensation
DOE F 3220.6B - Report of Compensation
Part II - Frequency Distribution Of Compensation
CHAPTER V
BENEFITS
1. OBJECTIVE. To ensure that contractors that perform work under cost reimbursement
contracts develop employee benefit programs that will attract and retain competent and
productive employees and that facilitate the achievement of objectives and business strategies
in support of DOE missions in a cost effective manner.
2. APPLICABILITY. This chapter is applicable to all Department Elements responsible for
management of contracts for the management and operation of the Department's facilities.
3. REQUIREMENTS. Reasonableness and allowability of compensation, including welfare
benefits, shall be determined for contracts to manage and operate DOE facilities in accordance
with the cost principles at DEAR 970.3102-2, and with either the clause "Allowable Costs and
Fixed Fee" (management and operation contracts, DEAR 970.5204-13) or the clause
"Allowable Costs and Fixed Fee" (support contracts, DEAR 970.5204-14) and shall be
determined for all other contracts in accordance with the guidelines at FAR 31.205-6.
4. RESPONSIBILITIES.
a. Deputy Assistant Secretary for Procurement and Assistance Management.
(1) Establishes Departmental performance objectives for contractor welfare benefit
programs management and assists field staffs to define performance measures and
expectations that will be used to evaluate accomplishment of performance
objectives.
(2) Approves contractor benefit plans and proposed changes that are an exception to
DOE policy.
(3) Defines reporting requirements regarding benefits cost and workers' compensation
loss information including format, definition of requirements, and schedule of
reporting.
(4) Provides consultation on benefit programs to Department Managers, Heads of
Contracting Activities, and contractors.
(5) Provides the results of any applicable benefits studies to Department Managers,
Heads of Contracting Activities, and contractors.
(6) Provides guidance to Heads of Contracting Activity on the conduct and use of the
methods for evaluating contractor welfare benefit programs using either the U.S.
Chamber of Commerce Benefits Survey or the Value Study method.
b. Heads of Contracting Activities.
(1) Develop performance measures, expectations, and related incentives for
performance-based contracts to achieve Department objectives and desired
improvements in contractor management of employee benefit programs.
(2) Evaluate contractor benefit programs on a periodic basis to assess program costs
and assure costs are reasonable and allowable.
(3) Approve the adoption by contractors of corporate benefit programs in their
entirety, which incorporate policy, procedures, cost sharing and other arrangements
of the parent organization.
(4) Approve contractor benefit plans and proposed changes that are either new or first
time on a site, set a precedent for the DOE contractor system, or involve flexible
benefit programs.
(5) Obtain approval of the Director, OCHRM for contractor benefit plans and
proposed changes that are an exception to DOE policy.
(6) For other than corporate benefit programs, approve the contractor's methodology
for evaluating its currently approved welfare benefits programs, consistent with the
provisions in the Contractor Requirements Document and (a) and (b) below. Either
the U. S. Chamber of Commerce Benefit Survey comparison method, (the per
capita cost per full-time equivalent employee) or the Value Study method (net
benefit value) may be used in this evaluation to establish an appropriate comparison.
(a) When the contractor's cost or value is within the range of acceptability (i.e., no
more than 5 percent above the comparator for other organizations), no further
action is required.
(b) When the contractor's cost or value is greater than 5 percent above the
comparator for other organizations, a corrective action plan to achieve
conformance with the range of acceptability defined in (a) above will be
required, unless otherwise justified in writing.
(7) Instruct contractors on the conduct and use of the methods for evaluating
contractor welfare benefit programs using either the U.S. Chamber of Commerce
Benefits Study or the Value Study method consistent with the guidance provided by
the Deputy Assistant Secretary for Procurement and Assistance Management.
(8) Approve a contractor's corrective action plan and evaluate contractor progress
against the plan.
(9) Approve contractor benefit programs and program changes in accordance with the
criteria set forth in the Contract Requirements Document. If the program or
changes result in the contractor's cost or value exceeding the range of acceptability
defined in 4.b.(6)(a) above, the program or changes will only be acceptable if offset
by changes that result in the contractor's costs or value being within the range of
acceptability.
(10) Approve contractor proposals for new workers compensation policies, initial
proposals for self-insurance for workers compensation, and assignment and/or
settlement of workers compensation programs.
(11) Establish a workers compensation settlement claims threshold for contractors to
obtain DOE approval; all settlement claims of $100,000.00 and more must be
approved by the Contracting Officer.
(12) Assure that contracts contain appropriate insurance and other benefits program
clauses and that each applicable Request for Proposals (RFP) contains such clauses.
(13) Assure that, where appropriate, competitive procurement procedures are followed
by contractors to obtain needed insurance coverage.
(14) Assure that subsequent to contract termination or expiration, benefit continuation
will be provided for those who earned such benefits, according to the approved
benefit plans, on a funding basis most reasonable to the Department. Among
acceptable arrangements for these provisions are paying a sum to the outgoing
contractor to continue its liability, paying a third party such as an insurer or other
contractor, to guarantee benefit payments, or continuing benefit payment obligation
with the replacement contractor.
(15) Assure that funding in advance for benefits earned by contractor retirees will not be
allowed unless such funding is required by state or federal statute. Such benefit
payments will be provided on a pay-as-you-go basis.
5. REFERENCES.
a. Federal Acquisition Regulations 31.205-6, COMPENSATION FOR PERSONAL
SERVICES.
b. Department of Energy Acquisition Regulations 970.3102-2, COMPENSATION FOR
PERSONAL SERVICES.
6. CONTACT. Office of Contractor Human Resource Management, at (202) 586-9008.
CONTRACTOR REQUIREMENTS DOCUMENT
EMPLOYEE BENEFITS
The following requirements apply to contracts for the management and operation of DOE facilities, as set forth in a
contract.
1. Contractors shall develop and implement welfare benefit programs that meet the tests of allowability and
reasonableness established by Federal Acquisition Regulations 31.205-6 and Department of Energy
Acquisition Regulations 970.3102-2, COMPENSATION FOR PERSONAL SERVICES.
2. Contractors shall submit the following to the Contracting Officer for approval, except where the Contracting
Officer has approved the adoption by the contractor of corporate benefit programs in their entirety.
a. An evaluation of Contractor Benefit Programs using a professionally recognized measure to compare
their benefit programs to other organizations (either a Value Study or a U.S. Chamber of Commerce
(COC) Employee Benefit Survey Comparison based on facility size). The contractor Value Study or
COC survey results must fall within the following acceptable values: 1) when contractor's per capita
cost per full-time equivalent employee or net benefit value is within the range of acceptability (i.e., no
more than 5 percent above the comparator for other organizations), no further action is required; 2)
when the contractor per capita cost per full-time equivalent employee or net benefit value is greater
than 5 percent above the comparator for other organizations, the contractor shall submit to the
Contracting Officer a corrective action plan to achieve conformance with the range of acceptability
defined above, unless otherwise justified in writing. The plan shall include specific benefit plan
changes and a timetables for implementation and shall be approved by the Contracting Officer.
Once a method of evaluation has been chosen, either a Value Study or COC, Contracting Officer
approval shall be required to change the method in subsequent years. For contractors using the
Value Study method, the studies shall be conducted every three years and are valid for three years,
regardless of contractor transition. For contractors using the COC method, comparison results must
be submitted annually to the Contracting Officer.
(1) If a Value Study is used, the following requirements apply.
(a) The contractor shall determine a list of no less than 15 participants to be a part of the
study. The Contracting Officer shall approve the list prior to the performance of the
study.
(b) The Value Study shall include major non-statutory benefit plans offered by the
contractor, including qualified defined benefit and
defined contribution retirement and capital accumulation plans, and
death, disability, health, and paid time-off welfare benefit programs.
(c) The Value Study must be performed by a national consulting firm
with expertise in benefit value studies.
(d) To the extent this methodology does not address post-retirement
benefit programs, contractors shall provide the Contracting Officer
separate cost and plan design data on post-retirement benefits other
than pensions compared to external benchmarks of a nationally
recognized survey source once every three years.
(2) If the COC is utilized, by March 1 of each year, the contractor shall
provide to the Contracting Officer a completed COC survey, including a
comparative analysis to the COC survey data, utilizing either the all
industries data or the data from a single Service Industry Code (SIC) that
has been agreed to by the Contracting Officer. The calculated per capita
benefits cost per full-time equivalent employee shall be compared to the
most recently published COC survey and contractor benefits data from the
same benefit year as the survey benefit year (i.e., comparing 1994
contractor data to the 1994 survey data).
b. Benefit Program Approval.
(1) Contractors shall submit new benefit plans and changes to plan design or
funding methodology with justification to the Contracting Officer for
approval. The justification must:
(a) demonstrate the effect of the plan changes on the contract net
benefit value or per capita benefit costs,
(b) provide the dollar estimate of savings or costs, and
(c) provide the basis of determining the estimated savings or cost.
(2) Contractors, other than those whose workers' compensation coverage is
provided through a state funded arrangement or a corporate benefits
program, shall submit to the Contracting Officer for approval all new
compensation policies and all initial proposals for self-insurance
(contractors shall provide copies to the Contracting Officer of all renewal policies
for workers compensation).
(a) Have a claims management program that establishes specific
guidelines and practices, and that ensures a regular review of
program components. This program includes, but is not limited to:
1 providing the Contracting Officer with annual status reports
on all claims reserves over $25,000, as well as reserves
established on all new claims;
2 conducting an annual review of all claims over $25,000 in
reserves and claims over 2 years old, regardless of reserve
amount;
3 reviewing reserves under an insured program on all open
claims at the end of each policy year but prior to the
valuation of claims for the interim premium adjustment
report to determine their appropriateness;
4 reviewing medical cost containment programs, such as
managed care networks, where allowed by statutes; and
5 conducting a sample claims review of open and closed
claims during the first 3 years of a contract period for both
active and canceled policies with existing claims activity. A
written report of the findings shall be submitted to the
Contracting Officer.
(b) Contractors under insured plans shall review and verify the
accuracy of interim premium adjustment reports and make payment
of adjusted premium or request of credit from carrier.
(c) Contractors' workers compensation insurance policies shall contain
the following provisions.
1 A provision excluding any claim on the part of the insurance
company to be subrogated on payment of loss or otherwise
to any claim against the United States.
2 A provision that in the event of cancellation or non-renewal
by the insurance company, 60 days advance notice shall be
given to the contractor, the Contracting Officer, and the
Office of Contractor Human Resource Management.
3 A provision limiting the insurance company's right of
inspection of the contractor's records and premises as
necessary to comply with DOE's security requirements.
4 A provision for the right of assignment of the policy to
DOE, with payment of all return premiums, premium
refunds dividends, or other moneys due or to become due,
to be payable to the Government.
5 Employer's liability coverage, except in cases where the
contractor has an acceptable self-insurance program.
6 Workers compensation and employer's liability coverage for
its employees in those states that allow statutory immunity
for certain types of employers (e.g., nonprofit educational
institutions).
7 Voluntary Compensation Endorsement in states that do not
automatically provide voluntary coverage. This allows for
coverage of employees or volunteers who would not
otherwise be covered for accidental injury (e.g., employees
participating in an athletic event or volunteers at the work
site). An additional amendment is necessary to extend
Voluntary Compensation Coverage to occupational disease.
(d) Workers compensation loss income benefit payments, when
supplemented by other programs (such as salary continuation,
short-term disability) are to be administered so that total benefit
payments from all sources shall not exceed 100 percent of the
employee's net pay.
(3) Contractors approve all workers compensation settlement claims up to the
threshold established by the Contracting Officer for DOE approval and
submit all settlement claims above the threshold to DOE for approval.
(4) If Dependent Care Facilities are approved by the Contracting Officer,
ensure the following non-discretionary elements that apply to contractor-
sponsored workplace or near workplace Dependent Care Facilities are
satisfied.
(a) Workplace child-care centers or other facilities for children shall not
be located at a DOE nuclear weapons complex or other hazardous
materials site.
(b) Dependent care benefit programs for contractor-operated facilities
must meet employee needs and management objectives based on a
valid study of dependent care needs.
(c) Support costs associated with the operation of a contractor
workplace or near workplace facility for exclusive use of DOE and
contractor employees may include all or a portion of such expense
items as utilities and maintenance, as well as food and medical
services or supplies that are already being used in support of site
operations and are readily available to additionally support the
facility. Such use shall be approved by the contracting officer in
advance. For the following costs to be considered allowable, capital
construction of a facility must be validated and approved by the
Contracting Officer.
1 Capital costs budgeted and accounted for in accordance
with DOE requirements related to capital projects. If the
results of the study indicate that dependent care needs can
be adequately addressed through any option or combination
of options other than a workplace or near workplace
contractor-sponsored dependent care facility, any costs
associated with the lease or purchase of such facility shall
not be reimbursable.
2 The costs for labor, materials, and supplies expended for the
operation of contractor workplace or near workplace
dependent care facilities shall not be allowable under any
circumstances. However, options for employees to finance
such costs through contractor employee welfare benefits
programs flexible spending accounts are subject to the
requirements of this chapter as it relates to welfare benefits.
(d) Any agreement between contractors and dependent care (program)
provider organizations must ensure that contractors and the DOE
are held harmless from liability.
1 Property damage liability and bodily injury liability insurance
policies must be retained by the dependent care (program)
provider organization in an amount appropriate for services
provided. The contractors must also be insured under these
policies.
2 Agreements between the contractors and dependent care
(program) provider organizations must ensure that the
provider organizations operate, maintain, and upgrade any
proposed workplace dependent care facility in compliance
with federal, state, and local policies, regulations, and
requirements for environment, safety and health.
(5) The contractor shall annually submit the Report of Contractor
Expenditures for Employee Supplemental Compensation (see attached
forms).
OMB APPROVED
PAGE 1 NO. 1910-0600
U.S. DEPARTMENT OF ENERGY
REPORT OF CONTRACTOR EXPENDITURES FOR EMPLOYEE SUPPLEMENTARY COMPENSATION
FIELD/OPERATIONS OFFICE: FACILITY NAME:
CONTRACT NUMBER: REPORT PERIOD (CALENDAR YEAR)
============================================================================================
PART ONE - EMPLOYMENT:
BARGAINING NONEXEMPT
EXEMPT: UNIT: NONBARGAINING UNIT: RETIREE:
============================================================================================
PART TWO - GROSS PAY
EXEMPT
BARGAINING
UNIT
NONEXEMPT
NON-
BARGAINING
UNIT
GROSS PAYROLL
ANNUAL BASE PAY
STRAIGHT-TIME PAY WORKED
VACATION PAY
VACATION PAY IN LIEU
HOLIDAY PAY
HOLIDAY PAY IN LIEU
SICK LEAVE PAY
PERSONAL LEAVE BANK
PERSONAL LEAVE PAY
PARENTAL LEAVE
OTHER PAID LEAVE PAY
OVERTIME PAY - STRAIGHT-TIME PORTION
OVERTIME PAY - PREMIUM PORTION
SHIFT DIFFERENTIAL
LUMP SUM PAYMENT
PERFORMANCE INCENTIVE COMPENSATION
OMB APPROVED
PAGE 2 NO. 1910-0600
U.S. DEPARTMENT OF ENERGY
REPORT OF CONTRACTOR EXPENDITURES FOR EMPLOYEE SUPPLEMENTARY COMPENSATION
FIELD/OPERATIONS OFFICE: FACILITY NAME:
CONTRACT NUMBER: REPORT PERIOD (CALENDAR YEAR)
PART TWO - GROSS PAY
EXEMPT
BARGAINING
UNIT
NONEXEMPT
NON-
BARGAINING
UNIT
CASH AWARD
NON PERFORMANCE-BASED BONUSES
FACILITY CLOSING RETENTION BONUS
VOLUNTARY SEPARATION BONUS
RELOCATION/HOUSING ALLOWANCE-DIRECT
RELOCATION/HOUSING ALLOWANCE-INDIRECT
REMOTE/ISOLATION PAY
HAZARD DUTY PAY
EXPATRIATE ALLOWANCE
EDUCATION ALLOWANCE-EMPLOYEE
EDUCATION ALLOWANCE-DEPENDENT
OTHER OVERTIME PAYMENT
GEOGRAPHIC DIFFERENTIAL PAY
SEVERANCE PAY
DEPENDENT CARE
MISC COMPENSATION
PART TWO - LEGAL REQUIRED
TOTAL
SOCIAL SECURITY
OTHER LEGALLY REQUIRED RETIREMENT PROGRAM
UNEMPLOYMENT - FEDERAL
UNEMPLOYMENT - STATE
OCCUPATIONAL INJURY AND ILLNESS
OTHER LEGALLY REQUIRED INSURANCE PROGRAMS
OMB APPROVED
PAGE 3 NO. 1910-0600
U.S. DEPARTMENT OF ENERGY
REPORT OF CONTRACTOR EXPENDITURES FOR EMPLOYEE SUPPLEMENTARY COMPENSATION
FIELD/OPERATIONS OFFICE: FACILITY NAME:
CONTRACT NUMBER: REPORT PERIOD (CALENDAR YEAR)
PART TWO - LIFE/DEATH
TOTAL
BARGAINING
UNIT
LIFE INSURANCE
DEATH BENEFITS
PART TWO - MEDICAL
TOTAL
BARGAINING
UNIT
INSURED ACTIVE MEDICAL
SELF-INSURED ACTIVE MEDICAL
DENTAL-ACTIVE
VISION/PRESCRIPTION-ACTIVE
MISC MEDICAL-ACTIVE
INSURED RETIREE MEDICAL
SELF-INSURED RETIREE MEDICAL
DENTAL-RETIREE
VISION/PRESCRIPTION-RETIREE
MISC MEDICAL-RETIREE
SHORT-TERM DISABILITY
LONG-TERM DISABILITY
DISPLACED WORKER
OMB APPROVED
PAGE 4 NO. 1910-0600
U.S. DEPARTMENT OF ENERGY
REPORT OF CONTRACTOR EXPENDITURES FOR EMPLOYEE SUPPLEMENTARY COMPENSATION
FIELD/OPERATIONS OFFICE: FACILITY NAME:
CONTRACT NUMBER: REPORT PERIOD (CALENDAR YEAR)
PART TWO - RETIREMENT
TOTAL
BARGAINING
UNIT
DEFINED CONTRIBUTION
SAVINGS/THRIFT PLAN
DEFINED BENEFITS
DISBURSEMENTS
EXPENSES
PART TWO - OTHER
TOTAL
BARGAINING
UNIT
VACATION/HOLIDAY FUNDS
DEPENDENT CARE
EMPLOYEE ASSISTANCE PROGRAM
MISC BENEFITS
OMB APPROVED
PAGE 5 NO. 1910-0600
U.S. DEPARTMENT OF ENERGY
REPORT OF CONTRACTOR EXPENDITURES FOR EMPLOYEE SUPPLEMENTARY COMPENSATION
FIELD/OPERATIONS OFFICE: FACILITY NAME:
CONTRACT NUMBER: REPORT PERIOD (CALENDAR YEAR)
PART THREE- PAID HOURS
EXEMPT
BARGAINING
UNIT
NONEXEMPT
NON-
BARGAINING
UNIT
STRAIGHT HOURS
OVERTIME HOURS
PREMIUM HOURS
VACATION HOURS
HOLIDAY HOURS
SICK LEAVE HOURS
PERSONAL LEAVE HOURS
OTHER PAID LEAVE HOURS
AVERAGE HOURS PER WEEK
OMB APPROVED
PAGE 6 NO. 1910-0600
U.S. DEPARTMENT OF ENERGY
REPORT OF CONTRACTOR EXPENDITURES FOR EMPLOYEE SUPPLEMENTARY COMPENSATION
FIELD/OPERATIONS OFFICE: FACILITY NAME:
CONTRACT NUMBER: REPORT PERIOD (CALENDAR YEAR)
PART FOUR
1. Indicate whether the employer (contractor) provides a flexible benefit program by
entering a (Y)es or (N)o.
2. Provide the number of medical plans by category.
INDEMNITY HEALTH INSURANCE
HMO
PPO
POS
OTHER
3. Provide the percentage of contribution the employees are required to contribute to any
medical plan(s) provided by the employer (contractor). Use an average percentage if
contributions vary among multiple plans.
SINGLE
FAMILY
4. Provide the percentage of contribution the retirees are required to contribute to any
medical plan(s) provided by the employer (contractor). Use an average percentage if
contributions vary among multiple plans.
UNDER 65
65 & OVER
5. Provide the number of retirees who are enrolled in a Retiree Medical Plan (exclude
spouse and/or dependents).
UNDER 65
65 & OVER
OMB APPROVED
PAGE 7 NO. 1910-0600
U.S. DEPARTMENT OF ENERGY
REPORT OF CONTRACTOR EXPENDITURES FOR EMPLOYEE SUPPLEMENTARY COMPENSATION
FIELD/OPERATIONS OFFICE: FACILITY NAME:
CONTRACT NUMBER: REPORT PERIOD (CALENDAR YEAR)
PART FIVE
COMMENTS
METHODOLOGY
CHAPTER VI
DOE CONTRACTOR PENSION PLANS
1. OBJECTIVES.
a. To assign responsibilities for establishing, maintaining, and terminating pension
plans provided for personnel employed by designated contractors at DOE facilities.
b. To properly consign assets when contractors are replaced, a portion of the existing
plan is spun off, or a plan terminates fully or partially.
c. To provide guidance regarding the contractual treatment of separate and
commingled pension plans where DOE has a continuing long-term involvement.
2. APPLICABILITY. This chapter applies to all Departmental Elements responsible for the
contracts for management, operation, and control of DOE facilities. Application to other
designated long-lived onsite contracts is optional at the discretion of Departmental and
Field Elements.
3. REQUIREMENTS. The following protective measures will be implemented for each
contract that provides a continuing Departmental pension obligation.
a. Separate accounting of assets resulting from DOE reimbursements and liabilities
related to service under DOE contracts.
b. Reimbursement to DOE of excess assets at time of contract termination or
expiration or plan termination.
c. Limitation on annual DOE reimbursements of contributions as specified herein.
d. Approval by the contracting officer of any plan change.
4. RESPONSIBILITIES.
a. Director, Office of Contractor Management and Administration.
(1) Establishes DOE policy and requirements for contractor pension plans at
DOE facilities.
(2) Provides guidance to Operations Offices on pension matters.
(3) Advises the cognizant contracting officer concerning:
(a) Structuring of pension plans, including funding levels and actuarial
assumptions;
(b) Changes in contractor pension plan provisions other than
Taft-Hartley pension plan provisions;
(c) Final settlements of assets and liabilities; and
(d) The DOE-reimbursable portions of contractor contributions to
Taft-Hartley pension plans.
(4) Maintains liaison on contractor pension matters with the Department of
Labor, the Internal Revenue Service (IRS), the Pension Benefit Guaranty
Corporation (PBGC), and the Cost Accounting Standards Board.
b. Heads of Contracting Activities (HCA). Approve contract provisions for
contractor pension programs and changes to contractor pension plans covered by
this order.
c. Cognizant Contracting Officers.
(1) Establish and negotiate contract provisions affecting contractor pension
programs.
(2) Negotiate settlements with the contractor when a pension plan is modified
or terminated, either fully or partially.
(3) Approve contract provisions and changes to contractor pension plans
covered by this order when delegated by the HCA.
(4) Advise the Office of Contractor Management and Administration of any
significant changes in the funding status or level of assets in a pension plan.
d. General Counsel. Advises and assists in negotiations at time of contract
termination, plan termination, plan spin-off, or plan merger, including reviewing
fiduciary documents, as necessary.
5. REFERENCES.
a. Employee Retirement Income Security Act (ERISA) (Public Law 93-406, 29
U.S.C. Sections 1001 et seq.), as amended, defines federally mandated features of
pension plans.
b. Internal Revenue Code (IRC) Sections 401 through 418 establish
nondiscrimination and funding requirements, inter alia, that a pension plan must
meet to qualify for a tax deduction.
c. Final and Temporary Internal Revenue Service (IRS) Regulations 1.401 through
1.418 provide working guidelines for applying the principles of the IRC.
d. Final and Temporary Department of Labor (DOL) Regulations 860 and 2500
through 2599 provide minimum standards for pension accrual formulas, pension
crediting, retirement eligibility, and fiduciary roles.
e. Final and Temporary PBGC Regulations 2600 through 2699 prescribe the steps
for terminating a defined benefit pension plan.
f. Cost Accounting Standards (CAS) 412, 413, and 415 describe minimum standards
for measuring and allocating pension costs to a government contract activity.
g. Department of Energy Acquisition Regulation (DEAR) 970.3102-2(l) establishes
the allocability and allowability of DOE contractor pension plans.
h. Federal Acquisition Regulation Part 31 establishes contract cost principles and
procedures.
i. Federal Acquisition Regulation Part 32.6 establishes authority to collect debt.
j. Financial Accounting Standards Board (FASB) Statements 35, 87, and 88 provide
generally accepted accounting principles for reporting pension expenses to the
contractor's stockholders and to the Securities and Exchange Commission (SEC).
k. The Labor Management Relations Act of 1947 (61 Stat. 136, 29 U.S.C. Sections
141 et seq.) (Taft-Hartley Act) establishes the legal basis for collectively-
bargained, trusteed pension plans (i.e., multi employer plans).
6. CONTACT. Office of Contractor Management and Administration, HR-55, at (202)
586-1368. CONTRACTOR REQUIREMENTS DOCUMENT
DOE CONTRACTOR PENSION PLANS
Contractor officials shall ensure that requirements set forth below are applied in the establishment
and administration of DOE-funded pension plans covering prime cost reimbursement contracts
for management and operation of DOE facilities and for other DOE-funded pension plans as
stipulated in the contract.
.
1. BASIC REQUIREMENTS.
a. Except for commingled plans in existence as of the effective date of this Order,
each pension plan covering contractor employees at designated DOE and
contractor facilities shall be a separate pension plan as defined below. When
appropriate, commingled plans shall be converted to separate plans at the time of
new contract or the extension of an old contract.
b. DOE approval is required prior to implementing any change to a pension plan
covering prime cost reimbursement contracts for management and operation of
DOE facilities and other contracts when designated. Changes shall be in
accordance with and pursuant to the terms and conditions of the contract.
c. DOE approval is required for each newly adopted pension plan or for any changes
to commingled pension plans or Taft-Hartley pension plans.
d. Each contractor pension plan shall be submitted to an annual, full-scope audit by
an outside independent organization and the resulting report, submitted to DOE,
must provide the accounting details specified in ERISA Sections 103 and 104.
e. For existing commingled plans, the contractor shall maintain and provide separate
annual accounting of DOE liabilities and assets as for a separate plan.
f. For existing commingled plans, the contractor shall be liable for any shortfall in the
plan assets caused by funding or events unrelated to DOE contracts.
g. Contractors shall comply with the requirements of ERISA to the fullest extent
practical, even when a specific pension plan is exempt from ERISA.
h. Changes will be evaluated by DOE, with approval/disapproval based on the merits
of each benefit or proposed change, including the following:
(1) Total compensation.
(2) Pension benefit surveys published by the Bureau of Labor Statistics.
(3) Retirement studies published by consulting firms, educational institutions,
or policy groups.
(4) Software models developed by qualified actuaries.
2. FUNDING REQUIREMENTS.
a. Contributions to a trust during a plan year for a separate defined benefit pension
plan shall not exceed the greater of:
(1) the minimum contribution required by Section 302 of the Employee
Retirement Income Security Act (ERISA) and
(2) the amount estimated to eliminate the unfunded current liability as
projected to the end of the plan year. The term "unfunded current liability"
shall refer to the unfunded current liability as defined in Section 302(d)(8)
of ERISA. Contributions above the minimum shall require approval by the
Department and shall be supported with adequate justification.
b. The DOE funding policy is intended to be congruent with the basic objectives of
the CAS and will generally result in funding consistent with the CAS. If this policy
causes a temporary, technical inconsistency with the CAS, the contractor shall
immediately notify the cognizant Contracting Officer and Chief Financial Officer.
Contractors have recourse to the cost principles found at DEAR 970.3102-2(1)(2)
and (3) and shall avoid penalties on that basis.
3. REPORTING REQUIREMENTS FOR DESIGNATED CONTRACTS. The following
reports shall be submitted to DOE within one year of the last day of the plan year by the
contractor responsible for each designated pension plan funded by DOE.
a. Actuarial Valuation Reports. The annual actuarial valuation report for each
DOE-reimbursed pension plan. When a pension plan is commingled, the
contractor shall submit separate reports for DOE's portion and the plan total.
b. Forms 5500. Copies of IRS Forms 5500 with Schedules for each DOE-funded
pension plan.
c. Forms 5300. Copies of all forms in the 5300 series submitted to the IRS that
document the establishment, amendment, termination, spin-off, or merger of a
plan.
4. TERMINATING OPERATIONS. When operations at a designated DOE facility are
terminated and no further work is to occur under the prime contract, the following apply.
a. No further benefits for service shall accrue.
b. The contractor shall provide a determination statement in its settlement proposal,
defining and identifying all liabilities and assets attributable to the DOE contract.
c. The contractor shall base its pension liabilities attributable to DOE contract work
on the market value of annuities or dispose of such liabilities through a competitive
purchase of annuities. Insurance companies bidding for such business shall satisfy
Department of Labor requirements.
d. Assets shall be determined using the "accrual-basis market value" on the date of
termination of operations.
e. DOE and the contractor(s) shall establish an effective date for spinoff or plan
termination. On the same day as the contractor notifies the IRS of the spinoff or
plan termination, all DOE assets assigned to a spun-off or terminating plan shall be
placed in a high-yield, fixed-income portfolio until the successor trustee, or an
insurance company, is able to assume stewardship of those assets. The portfolio
shall be rated no lower than Standard & Poor's "AA."
5. CONTINUING OPERATIONS. When one prime contractor is replaced by another, the
contracting parties shall ensure the following.
a. Incumbent Contractor.
(1) Shall spin off the DOE portion of any commingled plan used to cover
employees working at the DOE facility into a separate plan. The new plan
will normally provide benefits similar to those provided by the commingled
plan and shall carry with it the DOE assets on an accrual basis market
value, including DOE assets that have accrued in excess of DOE liabilities.
(2) Shall bargain in good faith with DOE or the successor contractor to
determine the assumptions and methods for establishing the liabilities
involved in a spinoff.
b. Successor Contractor. Shall assume sponsorship of any DOE site-specific plans
from the departing contractor. This includes site-specific plans already in existence
or newly created.
c. Spun-off Plan. DOE and the contractor(s) shall establish an effective date of
spinoff. On the same day as the contractor notifies the IRS of the spinoff, all DOE
assets assigned to a spun-off plan shall be placed in a high-yield, fixed-income
portfolio until the successor trustee is able to assume stewardship of those assets.
The portfolio shall be rated no lower than Standard & Poor's "AA."
6. TERMINATING PLANS.
a. DOE contractors shall not terminate any pension plan (commingled or site-
specific) without notifying the Department at least 60 days prior to the scheduled
date of plan termination.
b. To the extent possible, the contractor shall satisfy plan liabilities to plan
participants by the purchase of annuities through competitive bidding on the open
annuity market. Insurance companies bidding for this business shall satisfy
Department of Labor standards. Otherwise, the contractor shall apply the
assumptions and procedures of the Pension Benefit Guaranty Corporation.
c. Funds to be paid or transferred to any party as a result of settlements relating to
pension plan termination or reassignment shall accrue interest from the effective
date of termination or reassignment until the date of payment or transfer.
d. If ERISA or IRC rules prevent a full transfer of excess DOE reimbursed assets
from the terminated plan, the contractor shall pay any deficiency directly to DOE
according to a schedule of payments to be negotiated by the parties.
e. On the same day as the contractor notifies the IRS of the plan termination, all
DOE assets will be placed in a high-yield, fixed-income portfolio until full
disposition of the terminating plan's liabilities. The portfolio shall be rated no
lower than Standard & Poor's "AA."
f. DOE liability to a commingled pension plan shall not exceed that portion which
corresponds to DOE contract service. The DOE shall have no other liability to the
plan, to the plan sponsor, or to the plan participants.
g. After all liabilities of the plan are satisfied, the contractor shall return to DOE an
amount equaling the asset reversion from the plan termination and any earnings
which accrue on that amount because of a delay in the payment to DOE. Such
amount and such earnings shall be subject to DOE audit. To effect the purposes of
this paragraph, DOE and the contractor may stipulate to a schedule of payments.
7. SPECIAL PROGRAMS. Contractors must advise DOE and receive prior approval for
each early-out program, window benefit, disability program, plan-loan feature, employee
contribution refund, asset reversion, or incidental benefit. DEFINITIONS
1. Commingled Plans. Cover employees from the contractor's private operations and its
DOE contract work.
2. Current Liability. The sum of all plan liabilities to employees and their beneficiaries.
Current liability includes only benefits accrued to the date of valuation. This liability is
commonly expressed as a present value.
3. Defined Benefit Pension Plan. Provides a pension amount calculated by applying to an
employee's service (and, in some cases, to an employee's salary) a formula specified in the
plan document.
4. Defined Contribution Pension Plan. Provides to each plan participant the accumulation of
employer contributions, employee contributions, and investment returns on behalf of that
plan participant. The plan specifies contributions (normally as a percent of salary). The
plan also specifies the permissible timing, type, and amount of payments to the plan
participant or survivors.
5. Designated Contract. For purposes of this Order, a contract (other than a prime cost
reimbursement contract for management and operation of a DOE facility) for which the
Head of the Departmental Contracting Activity determines that advance pension
understandings are necessary or where there is a continuing Departmental obligation to the
pension plan.
6. Pension Fund. The portfolio of investments and cash provided by employer and employee
contributions and investment returns. A pension fund exists to defray pension plan benefit
outlays and (at the option of the plan sponsor) the administrative expenses of the plan.
7. Separate Accounting. Account records established and maintained within a commingled
plan for assets and liabilities attributable to DOE contract service. NOTE: The assets so
represented are not for the exclusive benefit of any one group of plan participants.
8. Separate Plan. Must satisfy IRC Sec. 414(l) definition of a single plan, designate assets
for the exclusive benefit of employees under DOE contract, exist under a separate plan
document (having its own DOL plan number) that is distinct from corporate plan
documents and identify the contractor as the plan sponsor.
9. Spun-off Plan. A new plan which satisfies IRC Reg. 1.414 (l)-1 requirements for a single
plan and which is created by separating assets and liabilities from a larger original plan.
The funding level of each individual participant's benefits shall be no less than before the
event, when calculated on a "plan termination basis." CHAPTER VII
RISK MANAGEMENT AND LIABILITY PROGRAMS
1. OBJECTIVES.
a. To assign responsibilities and authorities for the review and approval of contractor
liability insurance programs.
b. Ensure DOE compliance with applicable liability and indemnification requirements.
c. Provide a framework through which DOE contractors can develop a cost-effective
program for handling liability matters peculiar to their operational responsibility.
2. APPLICABILITY. This chapter applies to all Departmental Elements responsible for the
contracts for management, operation, and control of DOE facilities. Application to other
designated long-lived onsite contracts is optional at the discretion of Departmental and Field
Elements.
3. REQUIREMENTS. A cost-effective liability program will be developed covering
employer's liability, commercial general liability, business auto liability, aircraft public and
passenger liability, and vessel liability (FAR 28.307-2).
4. RESPONSIBILITIES.
a. Director, Office of Contractor Management and Administration.
(1) Develops and assists with the implementation of policies, procedures, and standards
for contractor insurance programs.
(2) Provides advice and assistance to Heads of Departmental and Field Elements on all
contractor insurance matters, when requested. Areas of consultation include:
(a) policy and plan review,
(b) claims administration review for adequacy and cost effectiveness,
(c) final insurance policy/program cost settlements,
(d) claim threshold reviews along with claims that exceed established thresholds,
(e) support of claims services negotiation, and
(f) required language in covered contracts.
(3) Maintains liaison and consults with other federal agencies and insurance industry
organizations concerning insurance matters.
(4) Maintains contractor insurance data sufficient to serve as a program baseline and
provide overall measurement and justification for implementation of program
initiatives and direction.
b. Heads of Contracting Activities (HCA).
(1) Ensure compliance with the policies, procedures, and requirements set forth in this
chapter.
(2) Ensure that proposed commercial insurance policies clearly define and include the
liability coverage required/desired, that the cost for proposed coverage is fair and
reasonable, and that commercial, self-insurance, and DOE TPA options are
considered.
c. Cognizant Contracting Officers.
(1) Establish and negotiate contract provisions affecting contractor insurance
programs.
(2) Approve contractor insurance policies and plans proposed for operations at DOE
facilities when delegated by the HCA.
(3) Approve renewal insurance policies and plans for contractor operations at DOE
facilities.
(4) Ensure that solicitations and contracts contain required insurance language and
clauses.
(5) Provide copies of contractor insurance policies, contracts, and annual cost and loss
data to the Office of Contractor Management and Administration.
5. REFERENCES.
a. Public Law 85-265, ATOMIC ENERGY ACT OF 1954, as amended.
b. Federal Acquisition Regulations (FAR) 28.3, INSURANCE.
c. Department of Energy Acquisition Regulations (DEAR) 928.3, INSURANCE.
d. FAR Part 30, COST ACCOUNTING STANDARDS ADMINISTRATION.
e. FAR 31.205-19, INSURANCE AND INDEMNIFICATION.
f. Cost Accounting Standards (CAS) 416, ACCOUNTING FOR INSURANCE COSTS.
g. DEAR 950, EXTRAORDINARY CONTRACTUAL ACTIONS, describes DOE
contractual indemnification authority for nuclear and non-nuclear public liability risks.
h. DEAR 950.70, NUCLEAR INDEMNIFICATION OF DOE CONTRACTORS.
i. DEAR 950.71, GENERAL CONTRACT AUTHORITY INDEMNITY.
j. DEAR 970.28, BONDS AND INSURANCE
k. DEAR 970.2870, INDEMNIFICATION.
l. DEAR 970.5204-14 ALLOWABLE COSTS AND FIXED-FEE (SUPPORT
CONTRACTS)
m. DEAR 970.5204-31, INSURANCE-LITIGATION AND CLAIMS.
n. Acquisition Letter Number 94-15, dated 10-18-94, provides guidance on determining
reasonableness of costs charged to government contracts.
6. CONTACT. Office of Contractor Management and Administration, HR-55, at (202)
586-1368.
CONTRACTOR REQUIREMENTS DOCUMENT
RISK MANAGEMENT AND LIABILITY PROGRAMS
Contractor officials shall ensure that the requirements set forth below are applied in the
establishment and administration of DOE-funded prime cost reimbursement contracts for
management and operation of DOE facilities and other designated long-lived onsite contracts for
which the contractor has established separate operating business units.
1. BASIC REQUIREMENTS.
a. Maintain commercial insurance or self-insurance programs required by law,
regulation, and the requirements of the contract.
b. Contractors shall not purchase insurance to cover public liability for nuclear
incidents without DOE authorization. (See DEAR 950.7010 and 970.2870.)
c. Demonstrate that insurance program costs comply with cost limitations and
exclusions at FAR 31.205.19, INSURANCE AND INDEMNIFICATION.
d. Demonstrate that the liability insurance program is being conducted in the
government's best interest and at reasonable cost.
e. Provide current copies of all insurance policies or insurance arrangements,
throughout the contract term, to the contracting officer.
f. Ensure that self-insurance programs include the following elements.
(1) Criteria required to justify self-insurance costs. (See FAR 28.308, SELF-
INSURANCE.)
(2) Demonstration of full compliance with applicable state and federal
regulations and related professional administration necessary for
participation in alternative insurance programs.
(3) Safeguards to ensure that third party claims and claim settlements are
processed in accordance with approved procedures.
2. Plan Experience Reporting.
a. Provide the contracting officer with annual experience reports for each type of
liability (i.e., automobile and commercial general liability) listing the following for
each category.
(1) The amount paid for each claim.
(2) The amount reserved for each claim.
(3) The direct expenses related to each claim.
(4) A summary for the year showing total number of claims.
(5) A total amount for claims paid.
(6) A total amount reserved for claims.
(7) The total amount of direct expenses.
b. When applicable, separately identify total policy expenses (e.g., commissions,
premiums, and costs for claims servicing) and major claims during the year
including those expected to become major claims (e.g., those valued at $100,000
or greater).
c. Additional claim and financial experience data may be requested from the
policyholder on a case by case.
3. TERMINATING OPERATIONS. Responsible officials shall ensure:
a. That the government's interests are protected through proper recording of
cancellation credits due to policy terminations and/or experience rating.
b. Continuing policy administration requirements are identified and provided by the
terminated contractor, another DOE contractor, or a DOE Operations/Field
Office.
c. DOE and any self-insured contractor reach agreement on handling and settlement
of claims incurred but not reported at time of contract termination; otherwise, the
contractor shall retain this liability; and
d. Insurance policies are transferred to DOE through an "assignment" of policies
after all claims are closed.
4. SUCCESSOR CONTRACTOR OR INSURANCE POLICY CANCELLATION. Unless
otherwise determined to be in the government's best interests, contractors shall ensure:
a. That insurance policies of a former DOE contractor are assumed by the successor;
b. the contractor protects the government's interests, through proper recording of all
cancellation credits, due to policy terminations and/or experience rating;
c. the successor contractor assumes any continued claims administration relating to
the former DOE contractor operation;
d. incurred but not reported claims relating to the former DOE contractor's operation
are reported to and handled by the appropriate insurer;
e. successor DOE contractors obtain the written approval by the contracting officer
for any change in program direction; and
f. insurance coverage replacement is maintained as required and/or approved by the
contracting officer.
ADDITIONAL GUIDANCE.
1. Insurance. Contractors selected to manage and operate DOE-owned facilities have
traditionally used insurance companies to provide claims and settlement services. These
traditional policies are referred to as "service-type policies" or "retrospective policies."
Under such policies, DOE has underwritten losses to the extent the losses were allowable
under the terms of the contract. The contractor has some flexibility as to how it sets up its
insurance program; however, if it is determined that specific alternative arrangements, as
noted below, will be in the government's best interest, DOE officials may require
participation by DOE contractors.
(a) Service-type (Retrospective) Insurance Policies. These policies represent an un-
bundling of insurer services to allow claims adjustment and settlement only. Under
this arrangement, an insurer issues policies to the DOE contractor and the insurer's
claims services are then utilized; however, no contingent liabilities are transferred
to the insurer. Various types of claims can be handled under these policies, as
approved by the appropriate DOE contracting official. The cost of the policy is
the cost of claims plus adjustment costs, administrative costs (e.g., taxes), and a
fee for service to the insurer. Adjustment costs are to be determined on a basis
that avoids in fact and appearance a percentage of cost fee structure. Final cost is
not determined until the policy is canceled or expires and all claims incurred have
been processed and settled. Certificates of insurance can be issued by the insurer
as required to show proof of financial responsibility.
(b) Self-insurance by DOE contractors. This program requires contractors to service
claims using their own personnel or to acquire a TPA to service claims.
Previously, some DOE self-insured contractors have used a TPA contractor to
accomplish their claim services. TPAs offer "administrative services," including
claims investigation and claims settlement and possibly other related services.
(c) Self-insurance Using the Departmental Third Party Administrator (TPA). DOE
HQ has a contract for nationwide services with a TPA contractor that is available
to DOE contractors on a fixed cost per claim basis. It also offers a variety of loss
control/prevention services on a fixed price per hour basis. This contract is the
"cost" standard against which all others should be measured. DOE contracts
should require DOE contractors to use this service, where it is in the Government's
best interest. Contracting Officers should carefully evaluate contractor
justification for use of any alternative insurance program, against the cost and
benefits provided by the Departmental TPA. CONTRACTOR LIABILITY SCENARIOS
The following are some of they types of liability exposures to which a contractor may be exposed.
1. Premises and Operations Liability Exposures. Premises and operations claims can arise
out of either the premises owned or utilized or out of operations conducted at or away
from these premises.
2. Products and Completed Operations Liability Exposures. Products claims can arise out of
goods that have been manufactured, sold, handled, or distributed; completed operations
claims can arise out of services performed after such services have been completed.
3. Employee Benefit Programs Liability Exposures. Employee benefit program claims can
arise out of negligent administration of such plans by those authorized to act in some
certain administrative capacity for these plans.
4. Fiduciary Liability Exposures. Fiduciary claims can arise from violation(s), or alleged
violation(s), of the responsibilities, obligations, or duties imposed upon fiduciaries by the
Employee Retirement Income Security Act of 1974, or amendments thereto.
5. Employers Liability Exposures. Employer claims can arise when an employee is injured or
becomes stricken with an occupational disease due to an employer's negligence. NOTE:
Workers compensation is payable to employees when an employer has met its "duty of
care" responsibilities.
6. Pollution Liability Exposures. Pollution claims can arise due to careless or reckless
conduct that damages others through the impairment of air, land, or water resources.
7. Medical Malpractice Liability Exposures. Medical malpractice claims can arise when
others are damaged by medical professionals who have breached a standard or standards
of care.
8. Auto, Aircraft, Watercraft Liability Exposures. Auto, aircraft, or watercraft claims can
arise when, through the use of such vehicles, third persons are damage
DEFINITIONS
1. Liability. A condition of being legally bound in law and justice to do something that may
be enforced in the courts. Liability insurance can provide extremely broad coverage for
this legal liability.
2. Commercial insurance policy. A contract in which one party, for consideration, agrees to
reimburse another for a loss caused by designated contingencies. The first party is called
the insurer or underwriter; the second, the insured or policyholder; the contract is the
insurance policy; the legal consideration is the premium; the bodily injury or property
insured is the exposure; and the contingency is the happening of the insured event.
3. Service-type (retrospective) insurance policy. An insurance policy (contract) in which the
cost of the policy (premium) equals the policyholder's claims experience and the insurer's
administration cost, plus a fee to the insurer. Under this type of policy, the insurance
company does not use its own assets to reimburse the policyholder for a loss caused by
covered contingencies. The policy provides only for claim processing and any other
designated services.
4. Self-insurer. An individual, partnership, or corporation that retains responsibility for all or
part of its contingent losses.
5. Risk. The hazard or condition whose measure relates to the likely frequency or severity of
loss.
6. Risk management. A discipline with the goal to protect the assets and profits of an
organization by reducing the potential for a loss before it occurs. Includes appropriate
financing, through insurance and other means, and reduction of potential exposures to
catastrophic loss such as acts of God, human error, or court judgments.
7. Administrative Services Contract. An arrangement under which an insurer (underwriter),
insurance broker, or other organization provides administrative services only (e.g., claims
investigation, claims settlement). The party acquiring the service retains the liability for
loss exposure and losses incurred (self-insurance).
8. Third Party Administrator (TPA). The organization that has a contract requiring
performance of "administrative services only."
CHAPTER VIII
CONTRACTOR WORKPLACE SUBSTANCE ABUSE PROGRAMS
1. OBJECTIVES.
a. To maintain a substance abuse free workplace at DOE facilities operated under the
authority of the Atomic Energy Act of 1954 as amended.
b. To ensure Contractor Workplace Substance Abuse Programs that comply with the
requirements in 10 CFR 707, Work Place Substance Abuse Programs at DOE
Sites and with the requirements of other Federal agencies, are developed and
implemented.
2. APPLICABILITY.
a. This chapter applies to all DOE Elements that manage contracts for the
management and operation of DOE facilities and other contracts or subcontracts
with a value of $25,000 or more that have been determined by DOE to involve:
(1) access to or handling of classified information or special nuclear material,
(2) transportation of hazardous materials to or from a DOE site, and/or
(3) high risk of danger to life, the environment, public health and safety, or
national security.
b. The drug testing provisions apply only to those contractors and subcontractors
where positions subject to testing, pursuant to 10 CFR 707, called Testing
Designated Positions (TDP's), have been identified and/or applicable testing
regulations of other Federal agencies (e.g. Department of Transportation
regulations) are applicable.
3. REQUIREMENTS. Contractor Workplace Substance Abuse Programs shall conform to
the requirements of 10 CFR 707 and applicable regulations issued by other Federal
agencies..
4. RESPONSIBILITIES.
a. Assistant Secretary for Defense Programs. Develops policy and issues
implementation guidance for any substance abuse requirements in the Personnel
Assurance Program that are in addition to those in 10 CFR 707, regulations of
other Federal agencies, and this chapter.
b. Assistant Secretary for Environment, Safety and Health through the Office of
Occupational Medicine and Medical Surveillance. Develops policies, procedures,
and standards for the medical and behavioral aspects of human reliability programs,
including treatment and followup for Contractor Workplace Substance Abuse
programs.
c. Deputy Assistant Secretary for Procurement and Assistance Management.
(1) Provides consultation, advice, and assistance to Heads of Contracting
Activities and contractors to facilitate effective implementation of
Workplace Substance Abuse programs.
(2) Maintains a consolidated record of prime contractors and subcontractors
that the cognizant Heads of Contracting Activity have determined to be
covered by 10 CFR 707 and provides a current list to the Managers of
Field Elements and covered contractors on at least a semiannual basis.
d. Director, Office of Nonproliferation and National Security. Develops policy and
issues implementation guidance for any substance abuse requirements in the
Personnel Security Assurance Program that are in addition to those in 10 CFR 707
and this chapter.
e. Heads of Contracting Activities.
(1) Include the following in the procurement request package for each DOE
procurement requiring the application of 10 CFR 707, substance abuse
testing programs of other Federal agencies and this chapter.
(a) Those requirements in 10 CFR 707 appropriate to the specific site
and/or facility.
(b) Requirements for the flow-down of 10 CFR707 to any subcontract
covered by the regulation.
(c) Requirements for substance abuse testing for other Federal
agencies.
(2) Review and approve Contractor Workplace Substance Abuse Programs,
including provisions for testing designated positions.
(3) Review and approve in advance the annual costs associated with contractor
Workplace Substance Abuse Programs.
(4) Approve contractor requests to conduct additional testing programs as
permitted in Sections 10 CFR 707.5(e) and 707.7(d).
5. REFERENCES.
a. 10 CFR 707, Work Place Substance Abuse Programs at DOE Sites, which
establishes requirements and defines program elements for programs established by
contractors for prevention, education and testing to deal with possible use of
illegal drugs.
b. "Mandatory Guidelines for Federal Workplace Drug Testing Programs" issued by
Department of Health and Human Services in Federal Register dated June 9, 1994,
and subsequent revisions.
c. "Substance Abuse Education and Training: A Resource Guide for Compliance
with 10 CFR part 707" dated January 1994.
d. Department of Transportation Regulations:
(1) Drug and Alcohol Testing Rule, 49 CFR part 40
(2) Federal Highway Administration, 49 CFR part 382
(3) Federal Transportation Agency, 49 CFR parts 653 and 654
(4) Federal Aviation Administration, 14 CFR part 121
(5) Research and Special Program Administration, 49 CFR part 199
(6) Federal Railroad Administration, 49 CFR part 219
e. Nuclear Regulatory Commission, 10 CFR part 26, Fitness-for-Duty Program.
6. CONTACT. Office of Contractor Human Resource Management, at (202) 586-9008.
CONTRACTOR REQUIREMENTS DOCUMENT
CONTRACTOR WORKPLACE SUBSTANCE ABUSE PROGRAMS
The following requirements apply to contracts for the management and operation of DOE
facilities and other contracts or subcontracts with a value of $25,000 or more that have been
determined by DOE to involve:
a. access to or handling of classified information or special nuclear material,
b. transportation of hazardous materials to or from a DOE site, and/or
c. high risk of danger to life, the environment, public health and safety, or national
security.
1. Comp