Overview
This section outlines the administrative remedies and penalties available to the government when a contractor fails to maintain a drug-free workplace, ranging from payment suspension to contract termination and debarment. It establishes the specific triggers for these actions and the high-level waiver process required to bypass them.
Key Rules
- Triggering Causes: Actions are initiated if the contractor fails to comply with FAR 52.226-7 (Drug-Free Workplace) or if the volume of employee criminal drug convictions in the workplace suggests the contractor has not made a "good faith effort" to provide a drug-free environment.
- Contracting Officer (CO) Actions: Upon a written determination of cause, the CO may suspend contract payments or terminate the contract for default.
- Mandatory Referral: If the CO initiates a payment suspension or termination, they must refer the case to the agency’s suspending and debarring official (SDO) for potential government-wide exclusion.
- Non-Delegable Waiver: Only the Agency Head may waive these actions, and only if a waiver is necessary to prevent "severe disruption" to agency operations. This authority cannot be delegated to subordinates.
Practical Implications
- Corporate-Level Risk: Because a lack of "good faith effort" is a subjective determination based on the number of employee convictions, contractors must proactively document their drug-free workplace programs to mitigate the risk of contract termination.
- Severe Penalties: These regulations link specific workplace conduct directly to a "Default" termination and debarment, which can effectively end a company's ability to do business with the entire Federal Government.