Overview
This section prescribes the mandatory inclusion of the "Payments to Small Business Subcontractors" clause in federal solicitations and contracts that require a small business subcontracting plan. It establishes a regulatory link between subcontracting oversight and contractor performance evaluation.
Key Rules
- Mandatory Prescription: Contracting officers must insert the clause at FAR 52.242-5 (Payments to Small Business Subcontractors) in specific instances.
- Triggering Condition: The requirement applies to all solicitations and contracts that already contain the clause at FAR 52.219-9 (Small Business Subcontracting Plan).
- Scope: This rule applies across all types of solicitations and contracts, provided the subcontracting plan threshold is met.
Practical Implications
- Accountability: Prime contractors are legally obligated to notify the government if they make reduced or untimely payments to small business subcontractors.
- Performance Monitoring: Because this sits within FAR Part 42 (Contract Administration), any failure to comply with payment terms can be documented and negatively impact the contractor's past performance rating (CPARS).