As frequent SmallGovCon readers know, the Small Business Administration’s ostensible subcontractor rule can be tricky to navigate. The rule requires contractors not to rely too heavily on a subcontractor in the performance of a contract set aside under an SBA socioeconomic program, but what constitutes relying too heavily can be confusing for small business contractors. Without a clear measure of how reliant is too reliant, businesses have to worry that they may be denied an award or even worse, lose one in a post-award protest. In a recent decision, Daniels Building Company, Inc. v. United States, 24-1787, 175 Fed. Cl. 767 (2025), the Court of Federal Claims (COFC) provided potentially helpful insight into what SBA’s Office of Hearings and Appeals (OHA) and the Court of Federal Claims will consider when determining whether a prime contractor is “unusually reliant” on its subcontractor.
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Room for Improvement: GAO Reviews Agency Oversight of Small Business Subcontracting Plans
Recently, GAO published a report on small business subcontracting plan compliance, concluding that agency oversight of these plans need improvement.
Continue readingPrime Contractor Can Sponsor Subcontractor’s Claim to Government
Let’s say you’re a subcontractor to a prime contractor, which holds a construction contract with the Government. And you run into problems which need to be solved by submitting a claim to the contracting officer.
But, as the subcontractor, you don’t have a contractual relationship (privity of contract, in legal speak) with the Government. Can you still submit the claim?
Continue reading2020 NDAA: Subcontractors May Be Allowed to Take Non-Payment Allegations to OSDBU
The draft 2020 National Defense Authorization Act includes a dispute process for subcontractors when the prime contractor fails to pay.
Section 831 of the draft bill would amend the Small Business Act to allow subcontractors to report nonpayment to the Office of Small and Disadvantaged Business Utilization.
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