Overview
This section defines the applicability of FAR Subpart 11.5, which establishes the policies and procedures for implementing liquidated damages clauses across most major categories of federal procurement.
Key Rules
- General Applicability: The subpart applies to solicitations and contracts for supplies, services, research and development (R&D), and construction.
- Specific Exclusions: This subpart does not govern liquidated damages in the following three areas:
- Failure to make a good faith effort to comply with small business subcontracting plans (governed by FAR 19.705-7).
- Violations of the Contract Work Hours and Safety Standards statute (governed by FAR Subpart 22.3).
- Non-compliance with paid sick leave requirements for Federal contractors (governed by FAR Subpart 22.21).
Practical Implications
- Contracting officers must recognize that while Subpart 11.5 is the primary guide for performance-based liquidated damages (e.g., late delivery), labor-related and socioeconomic penalties are governed by distinct, specialized sections of the FAR.
- When drafting solicitations, the government must ensure that liquidated damages are applied appropriately according to the specific nature of the requirement (e.g., construction vs. subcontracting compliance).