Left at the Altar: What to do if Key Personnel Proposed for a Service Contract Break their Commitments?

Ding. It’s an email from Pat McBrilliant—your favorite project manager who you spent months trying to recruit for this big contract that’s being competed. The subject line is “status update.” 

Well, that sounds innocent enough. After all, the Government has been chewing on the proposal for many months. Then, you start reading. Pat’s providing an update about Pat’s status, not asking about yours. Pat’s bailing on you to take on a hot new position with Evil Competitor, Inc. “I’m so sorry that I won’t be available, but good luck with the Contract, all the best and stay in touch :)”

Yeah, right, you too.

Many service contracts require that certain jobs, i.e., “key positions,” be held by highly qualified personnel dedicated to the project. Think Program Managers, Chief Project Engineers, Subject Matter Experts, and the like. Often the Government requires prospective Contractors to identify these “key” individuals and provide their resumes or CVs. And, the Government frequently requires offerors to provide letters of commitment from key personnel in which they formally consent to their being proposed for key positions and that they will take the job if the contract is awarded.

Where a solicitation calls for offerors to propose key personnel, the prospective contractor is obliged to identify these individuals in good faith. Good faith means that the offeror communicated with the proposed key person, obtained a commitment that they would work on the contract and that the person consented to being identified in the offeror’s proposal to hold a given position. Often, the Government will request letters of commitment to confirm the key person’s availability.

Of course, as Pat’s email demonstrates, your proposal doesn’t exist in a vacuum. Things happen. That’s why some solicitations will include a “key personnel” clause that allows the substitution of key personnel subject to the approval of the contracting officer so long as the replacement possesses the same or greater qualifications.  See, e.g., 48 C.F.R. 352.237-75 (key personnel clause promulgated by Dep’t of Health and Human Services; 48 C.F.R. 852.237-75 (similar clause issued by Dep’t of Veterans Affairs).

But, a substitution that occurs on the heels of the contract award can result in the award being revoked or the contract terminated if it is determined that the substitution was a “bait and switch.” But, if the proposal of key personnel was done in good faith, documented as required, etc., you generally will not be guilty of a bait and switch if you had no knowledge that a key person would not be available and life can go on. See, e.g., Development Alternatives, Inc., B-217010, 85-1 CPD ¶ 188, 1985 WL 52433. So, if your contract was awarded and you had no way of knowing that Pat would bail on you, then you’re probably ok.

But, if an offeror learns during the course of the procurement before award but does nothing, then the technical evaluation of the competing proposals will have been infected by misrepresentation. See, e.g., General Revenue Corp., B-414220, 2017 CPD ¶ 106, 2017 WL 2130370 (stating obligation to notify “agencies of changes in [staffing] even after submission of proposals”). What an agency is supposed to do with such a disclosure is less than clear, but an agency pretty much will have a free hand to decide whether to evaluate the proposal as-is or to reopen discussions to permit the offeror to correct the deficiency. See, e.g., URS Federal Services, Inc., B-413034, 2016 CPD ¶ 209, 2016 WL 4088710.

 So, what to do? Keeping Pat’s unavailability to yourself is a risky proposition. A competitor could protest the award on the ground that the technical evaluation was tainted by a misrepresentation. Such a protest may or may not be sustained; however, it’s not ideal if one of your first communications with the customer is that you have to substitute someone for Pat McBrilliant when you knew about Pat’s unavailability. So, I believe it is best if this is disclosed as soon as possible with a request that the agency open up discussions to consider your awesome substitute—Lee Smartypants. There’s no guarantee that the agency won’t find your key personnel unacceptable, but the agency will have an option available to keep an otherwise excellent proposal in the running.