The Ten Commandments of Doing Business with the Federal Government

November 17th, 2014 11:35 am

The Ten Commandments of Doing Business with the Federal Government

1.  Thou Shalt Have No Other Deadlines Before Mine

If you want to win a government contract, bear in mind that the rule says the work will go to the lowest responsible, responsive bidder.  In reality, at the initial receipt stage, your bid will not even be considered, no matter how good you are, unless you meet the deadline for bid submissions.

2.  Do Not Take Appeal Rights In Vain

There are a number of alternate rights you can exercise if you are not awarded the contract.  They can be expensive, and should not be resorted to unless you have a good-faith belief that you were legally entitled to the contract.  On the other hand, seeking a de-brief to learn where your bid fell short can serve to demonstrate good faith on your part, and stand you in good stead on future bids.

3.  Thou Shalt Not Commit Partnering With Partners Who Are Disqualified

The U.S. Government maintains a list of contractors, AND subcontractors, who are suspended or debarred from doing business with the federal government.  You cannot include such an entity in your business arrangements on a government contract . . . and bear in mind, the burden is on you to ensure that such a subcontractor has not merely changed its corporate name to avoid being precluded.

4.  Honor the Government Contracting Officer

With few exceptions, the Contracting Officer (“the K.O.”) is your point of reference as you perform your work.  So, do not expect the government to honor work modifications / agreements to pay you more, which you negotiated with someone other than the KO, even when that person is senior to the KO in the chain of command.

5.  Do Not Bear False Witness . . . and Do Not Commingle

You are entitled to be paid what you contracted for, on each government contract you have, separate and distinct from any other contract.  You may not charge work on one contract which is actually being performed under another agreement, even if this seems “fair” to you because of unforeseen difficulties.

6.  Beware of Giving Gifts

Notwithstanding what may be acceptable practice in your industry, the Government has very specific and very firm prohibitions against most gifts from government contractors to government employees.  Although far short of the obvious ban on bribery, these rules can be a minefield for any government contractor who fails to learn and obey them.  This can include political contributions by certain contractors, in many States as well as at the Federal level.

7.  The Government Is a Demanding Client and Will Deal Harshly With Those Who Violate the Rules . . . but Can Show Mercy For Those Who Deserve It

Volumes have been written about the Federal Sentencing Guidelines.  The underlying philosophy is that those who cheat / mislead / engage in fraud will be made to pay severe penalties.  Therefore, it is vital to understand how to structure your actions when you become aware that your organization / employees have put you at risk so that you can secure a “downward departure” from the guidelines and receive lenient treatment.

8.  Honor Your Responsibilities As The Ethical Leader of Your Organization

In today’s world of Sarbanes-Oxley, Dodd-Frank, the FCPA, the spotlight is on YOU, and cannot be shunted off to subordinates.  You need sufficiently empowered people to help you promote ethical practices in your organization, but the buck stops with you.

9     . . . and speaking of bucks, Professional Liability Insurance is advisable for you and other top management officials, including members of your Board.

10.   Don’t Walk Through the Valley Alone

Industry Associations, your legal counsel, your auditors, and professional Ethics and Compliance experts can help you navigate the best way to get, and keep, government contracts.


Arnold Haiman, JD CCEP
Ethos LLC Senior Ethics Advisor