Federal Acquisition Regulation: Whistleblower Protection for Contractor Employees, 69517-69523 [2023-21321]

Agencies

• DEPARTMENT OF DEFENSE
• General Services Administration
• National Aeronautics and Space Administration

[Federal Register Volume 88, Number 192 (Thursday, October 5, 2023)]
[Rules and Regulations]
[Pages 69517-69523]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-21321]


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DEPARTMENT OF DEFENSE

GENERAL SERVICES ADMINISTRATION

NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

48 CFR Parts 3, 31, and 52

[FAC 2023-06, FAR Case 2017-005, Item II; Docket No. 2017-0005; 
Sequence No. 1]
RIN 9000-AN32


Federal Acquisition Regulation: Whistleblower Protection for 
Contractor Employees

AGENCY: Department of Defense (DoD), General Services Administration 
(GSA), and National Aeronautics and Space Administration (NASA).

ACTION: Final rule.

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SUMMARY: DoD, GSA, and NASA are issuing a final rule amending the 
Federal Acquisition Regulation (FAR) to implement an act to enhance 
whistleblower protection for contractor employees. The rule makes 
permanent the protection for disclosure of certain information. It also 
clarifies that the prohibition on reimbursement for legal fees accrued 
in defense against reprisal claims applies to subcontractors, as well 
as contractors.

DATES: Effective date: November 6, 2023.
    Applicability: At the time of any major modification to a contract, 
the agency shall make best efforts to include 52.203-17 in a contract 
that does not already contain it.

FOR FURTHER INFORMATION CONTACT: For clarification of content, contact 
Ms. Malissa Jones, Procurement Analyst, at 571-886-4687 or by email at 
[email protected]. For information pertaining to status or 
publication schedules, contact the Regulatory Secretariat Division at 
202-501-4755 or [email protected]. Please cite FAC 2023-06, FAR Case 
2017-005.

SUPPLEMENTARY INFORMATION:

I. Background

    DoD, GSA, and NASA published a proposed rule in the Federal 
Register at 83 FR 66223 on December 26, 2018, to amend the FAR to 
implement an act to enhance whistleblower protection for contractor and 
grantee employees, including employees of subcontractors (Pub. L. 114-
261), enacted December 14, 2016. Although the statute addresses both 
contractor and grantee employees, including employees of 
subcontractors, the FAR only directly covers contracts and contractors, 
and indirectly covers subcontracts and subcontractors with flowdown 
requirements. Grants are covered in title 2 of the Code of Federal 
Regulations.
    This statute also amends 41 U.S.C. 4712 to make permanent the pilot 
program for enhancement of contractor protection from reprisal for 
sharing certain information. This program does not apply to DoD, NASA, 
or the Coast Guard, where similar permanent enhanced whistleblower 
protections for contractor employees were enacted by section 827 of the 
National Defense Authorization Act (NDAA) for Fiscal Year (FY) 2013 
(Pub. L. 112-239, 10 U.S.C. 2409). Neither program applies to certain 
elements of the intelligence community (10 U.S.C. 2409(e) and 41 U.S.C. 
4712(f)).
    The four-year pilot program was enacted on January 2, 2013, by 
section 828 of the NDAA for FY 2013, with an

[[Page 69518]]

effective period of four years from the date of enactment (i.e., 
January 2, 2013, through January 1, 2017). Section 1091(e) of the NDAA 
for FY 2014 (Pub. L. 113-66) modified the effective period of the pilot 
program to be four years from the date that is 180 days after the date 
of enactment (i.e., July 1, 2013, through June 30, 2017). However, the 
program did not expire as it became permanent on December 14, 2016, 
before either of those expiration dates.
    Public Law 114-261 also clarifies that the cost principles at 10 
U.S.C. 2324(k) and 41 U.S.C. 4304 and 4310 that prohibit reimbursement 
for legal fees accrued in defense against reprisal claims apply to 
costs incurred by a contractor, subcontractor, or personal services 
contractor. Personal services contractors are contractors, and the cost 
principles generally already apply in the same way to costs incurred by 
subcontractors as to costs incurred by contractors. Three respondents 
submitted comments on the proposed rule.

II. Discussion and Analysis

    DoD, GSA, and NASA reviewed the public comments in the development 
of the final rule. The comments did not recommend changes to the rule; 
instead, they expressed concerns regarding the underlying intent of the 
statute. While DoD, GSA, and NASA recognize the concerns identified in 
the public comments, the public comments are not within the scope of 
the rule. A discussion of the comments received is provided as follows:

A. Summary of Changes From Proposed Rule

    No changes were made to the rule as a result of the public 
comments.
    A minor change was made from the proposed rule regarding the 
applicability of FAR 52.203-17. The proposed rule prescribed the clause 
in acquisitions above the simplified acquisition threshold (SAT). The 
final rule changes the prescription of clause 52.203-17 to apply to all 
solicitations and contracts, including those at or below the SAT. The 
clause implements 41 U.S.C. 4712(d), which requires contractors and 
subcontractors to notify their employees of their whistleblower 
protections. The employee protections of the whistleblower program are 
applicable to all contracts regardless if expressly stated in the 
awarded contract. By changing the clause prescription to include 
solicitations and contracts at or below the SAT, contractors and 
subcontractors will have greater awareness of this responsibility and 
employees also will be more aware of the whistleblower protections.

B. Analysis of Public Comments

1. Whistleblower Declaration
    Comment: A respondent stated that there should be a requirement for 
the whistleblower to declare they are blowing the whistle.
    Response: Changing the statutory requirement is outside the scope 
of the rule.
2. Compulsory Reinstatement
    Comment: A respondent stated that the current requirement to 
reinstate an employee if the IG or agency determine the whistleblower 
was retaliated against should not be compulsory.
    Response: Changing the statutory requirement at 41 U.S.C. 4712(c) 
is outside the scope of the rule.
3. Ability To Waive Complaint
    Comment: A respondent stated that FAR 3.905-1 should clarify 
whether or not whistleblower cases are exempt from employment 
agreements that waive the right to a jury trial or arbitration.
    Response: FAR 3.905-1(d) states there is no waiver: ``No waiver. 
The rights and remedies provided for in 41 U.S.C. 4712 may not be 
waived by any agreement, policy, form, or condition of employment.'' 
The source of this text is 41 U.S.C. 4712(c)(7). Also see 41 U.S.C. 
4712(c) for the right to a jury trial.
4. Standard for Liability
    Comment: A respondent stated that the statutory standard for 
determining liability should be changed from an event that 
``contributed'' to the negative employment action to one that 
``substantially contributed'' or ``primarily contributed'' to the 
negative employment action.
    Response: 41 U.S.C. 4712(a) states that ``an employee . . . may not 
be discharged, demoted, or otherwise discriminated against as a 
reprisal for disclosing . . .''. The statute does not require a showing 
that the event substantially or primarily contributed to the negative 
employment action.
5. Allowability of Legal Fees
    Comment: A respondent stated that the statutory requirement should 
include allowability of legal fees to settle de minimis suits and for 
suits when a contractor successfully defends itself from the 
whistleblower, as well as requiring the plaintiff to bear their own 
litigation costs unless the IG finds the whistleblowing 
``substantially'' or ``primarily'' contributed to the retaliatory 
action.
    Response: Some of these costs are already allowable, see FAR 
31.205-47. Changing the statutory requirements is outside the scope of 
the rule.
6. Readability
    Comment: A respondent stated that some of the changes in the rule 
make the text insufficiently readable. The respondent stated that the 
definition of ``abuse of authority'' and the text at FAR 3.903(a) and 
(c) have a low readability score.
    Response: The definition of ``abuse of authority'' in the proposed 
rule was taken verbatim from 41 U.S.C. 4712(g)(1) and previously 
included in the FAR at 3.908-2. The text at 3.903(a) was substantively 
drawn from 41 U.S.C. 4712(a)(1) and reframed in active voice as a 
prohibition that applies to contractors and subcontractors. The text at 
3.903(c) was taken verbatim from 41 U.S.C. 4712(a)(3)(A), with the 
exception of omitting references to grants. Because these are the words 
of the statute, no changes will be made.
7. Support for the Rule
    Comment: A respondent stated that they support the rule.
    Response: Noted.

III. Applicability to Contracts at or Below the Simplified Acquisition 
Threshold (SAT) and for Commercial Products and Commercial Services, 
Including Commercially Available Off-the-Shelf (COTS) Items

    Based on the determinations by the FAR signatories (DoD, GSA, and 
NASA) and the Administrator for Federal Procurement Policy, in 
accordance with 41 U.S.C. 1905, 1906, and 1907, this rule applies to 
all solicitations and resultant contracts, including contracts and 
subcontracts for acquisitions at or below the SAT, and contracts and 
subcontracts for the acquisition of commercial services and commercial 
products, including COTS items.
    As explained below, the underlying statutory requirements that this 
rule implements are applicable to all Government contracts and 
subcontracts by operation of law. The FAR is being amended to include 
the clause, 52.203-17, Contractor Employee Whistleblower Rights, which 
implements 41 U.S.C. 4712, in all prime contracts and subcontracts. The 
discretion that the FAR signatories and the Administrator are 
exercising is essentially limited to the determination to incorporate 
the clauses established by this rule into contracts and subcontracts 
below the SAT and contracts and subcontracts for commercial products, 
commercial services, and COTS items. The FAR

[[Page 69519]]

Council is not determining when the whistleblower law applies but 
rather when the clause would be included in contracts and subcontracts. 
The clause does not apply to DoD, NASA and the Coast Guard, or 
applicable elements of the intelligence community.

A. Applicability to Contracts at or Below the Simplified Acquisition 
Threshold

    Pursuant to 41 U.S.C. 1905, contracts or subcontracts in amounts 
not greater than the SAT will be exempt from a provision of law unless 
the law (i) contains criminal or civil penalties; (ii) specifically 
refers to 41 U.S.C. 1905 and states that the law applies to contracts 
and subcontracts in amounts not greater than the SAT; or (iii) the 
Federal Acquisition Regulatory Council (FAR Council) makes a written 
determination and finding (D&F) that it would not be in the best 
interest of the Federal Government to exempt contracts and subcontracts 
in amounts not greater than the SAT from the provision of law. If none 
of these conditions are met, the FAR is required to include the 
statutory requirement(s) on a list of provisions of law that are 
inapplicable to contracts and subcontracts in amounts not greater than 
the SAT.

B. Applicability to Contracts for the Acquisition of Commercial 
Products and Commercial Services

    Pursuant to 41 U.S.C. 1906, acquisitions of commercial products and 
commercial services (other than acquisitions of COTS items, which are 
addressed in 41 U.S.C. 1907) are exempt from a provision of law unless 
the law (i) contains criminal or civil penalties; (ii) specifically 
refers to 41 U.S.C. 1906 and states that the law applies to 
acquisitions of commercial products and commercial services; or (iii) 
the FAR Council makes a written determination that it would not be in 
the best interest of the Federal Government to exempt contracts and 
subcontracts for the procurement of commercial products and commercial 
services from the provision of law. If none of these conditions are 
met, the FAR is required to include the statutory requirement(s) on a 
list of provisions of law that are inapplicable to acquisitions of 
commercial products and commercial services.

C. Applicability to Contracts for Commercially Available Off-the-Shelf 
Items

    Pursuant to 41 U.S.C. 1907, acquisitions of COTS items will be 
exempt from a provision of law unless the law (i) contains criminal or 
civil penalties; (ii) specifically refers to 41 U.S.C. 1907 and states 
that the law applies to acquisitions of COTS items; (iii) concerns 
authorities or responsibilities under the Small Business Act (15 U.S.C. 
644) or bid protest procedures developed under the authority of 31 
U.S.C. 3511 et seq.; 10 U.S.C. 3308; or 41 U.S.C. 3706 and 3707; or 
(iv) the Administrator for Federal Procurement Policy makes a written 
determination that it would not be in the best interest of the Federal 
Government to exempt contracts and subcontracts for the procurement of 
COTS items from the provision of law.

D. Determinations

    The requirements of FAR 52.203-17, Contractor Employee 
Whistleblower Rights, ensures that all contractor and subcontractor 
employees are covered by the whistleblower rights and remedies. Having 
the clause in all Federal Government contracts is beneficial to 
contractor and subcontractor employees, and the public. Employees 
benefit from having whistleblower rights and remedies so they can 
report potential wrongdoing without fear of reprisal. The public 
benefits from employees reporting wrongdoing which may result in 
actions to hold firms responsible for unlawful acts. It is in the best 
interest of the Government to apply whistleblower protections through a 
clause in all Federal Government contracts.
    For these reasons, the FAR Council has determined that it is in the 
best interest of the Government to apply the final rule to contracts 
and subcontracts at or below the SAT and for the acquisition of 
commercial products and commercial services.
    Similarly, the Administrator for Federal Procurement Policy has 
determined that it is in the best interest of the Government to apply 
this rule to contracts and subcontracts for the acquisition of COTS 
items. It should be noted that the pilot program applied the clause to 
all commercial products, commercial services, and COTS acquisitions 
through 52.212-4(r), but only above the SAT for noncommercial 
acquisitions.

IV. Expected Impact of the Rule

    The rule enhances whistleblower protection for contractor employees 
by making permanent the protection for disclosure of certain 
information, and by applying the requirement for contractors and 
subcontractors to inform their employees of the whistleblower 
protections through the inclusion of FAR clause 52.203-17 in 
acquisitions at or below the SAT. It also clarifies that FAR 31.205-47 
prohibition on reimbursement for legal fees accrued in defense against 
reprisal claims applies to subcontractors, as well as contractors. DoD, 
NASA, and the Coast Guard have a different whistleblower program for 
contractor employees.

V. Executive Orders 12866 and 13563

    Executive Orders (E.O.s) 12866 and 13563 direct agencies to assess 
all costs and benefits of available regulatory alternatives and, if 
regulation is necessary, to select regulatory approaches that maximize 
net benefits (including potential economic, environmental, public 
health and safety effects, distributive impacts, and equity). E.O. 
13563 emphasizes the importance of quantifying both costs and benefits, 
of reducing costs, of harmonizing rules, and of promoting flexibility. 
This is not a significant regulatory action and, therefore, was not 
subject to review under Section 6(b) of E.O. 12866, Regulatory Planning 
and Review, dated September 30, 1993.

VI. Congressional Review Act

    The Congressional Review Act (5 U.S.C. 801-808) requires interim 
and final rules to be submitted to Congress before the rule takes 
effect. DoD, GSA, and NASA will send this to each House of the Congress 
and to the Comptroller General of the United States. The Office of 
Information and Regulatory Affairs (OIRA) in the Office of Management 
and Budget has determined that this is not a major rule under 5 U.S.C. 
804.

VII. Regulatory Flexibility Act

    DoD, GSA, and NASA have prepared a Final Regulatory Flexibility 
Analysis (FRFA) consistent with the Regulatory Flexibility Act, 5 
U.S.C. 601-612. The FRFA is summarized as follows:

    This rule will not have a significant economic impact on a 
substantial number of small entities within the meaning of the 
Regulatory Flexibility Act, 5 U.S.C. 601-612.
    This rule implements Public Law 114-261, which was enacted 
December 14, 2016. The objective of this rule is to enhance 
whistleblower protection for contractor employees, by making 
permanent the protection for disclosure of certain information and 
ensuring that the prohibition on reimbursement for certain legal 
costs applies to subcontractors, as well as contractors, as required 
by Public Law 114-261.
    This rule makes minor changes to the pilot program, along with 
making it a permanent program. In the final rule, the clause 52.203-
17 will apply to all solicitations and contracts. The pilot program 
applied the clause to all commercial products and commercial 
services and COTS acquisitions through 52.212-4(r), but only above 
the SAT for non-commercial acquisitions. The FAR Council made a 
determination to apply the

[[Page 69520]]

clause to contracts at or below the SAT because the contractor 
employee protections apply regardless of contract value. By changing 
the clause prescription to include solicitations and contracts at or 
below the SAT, this makes clearer the rights and protections 
employees have.
    There were no significant issues raised by the public in 
response to the initial regulatory flexibility analysis.
    The program does not apply to DoD, NASA, and the Coast Guard, 
nor to certain elements of the intelligence community. Based on 
Federal Procurement Data System (FPDS) data for fiscal year 2020-
2022, there were an average 146,242 new contract awards by agencies 
other than DoD, NASA, and the Coast Guard, including commercial 
awards and awards at or below the SAT that were awarded to small 
businesses (to an average of 23,984 unique vendors).
    Regarding the amendment to the cost principles, addition of the 
words ``or subcontractor'' in multiple places throughout FAR 31.205-
47 has no or a de minimis impact, because the cost principles 
generally already apply in the same way to costs incurred by 
subcontractors as to costs incurred by contractors.
    There are no reporting, recordkeeping, or other compliance 
requirements in this rule.
    DoD, GSA, and NASA were unable to identify any alternatives to 
the rule that would reduce the impact on small entities and still 
meet the requirements of the statute.

    Interested parties may obtain a copy of the FRFA from the 
Regulatory Secretariat Division. The Regulatory Secretariat Division 
has submitted a copy of the FRFA to the Chief Counsel for Advocacy of 
the Small Business Administration.

VIII. Paperwork Reduction Act

    The rule does not contain any information collection requirements 
that require the approval of the Office of Management and Budget under 
the Paperwork Reduction Act (44 U.S.C. 3501-3521).

List of Subjects in 48 CFR Parts 3, 31, and 52

    Government procurement.

William F. Clark,
Director, Office of Government-wide Acquisition Policy, Office of 
Acquisition Policy, Office of Government-wide Policy.

    Therefore, DoD, GSA, and NASA amend 48 CFR parts 3, 31, and 52 as 
set forth below:

0
1. The authority citation for 48 CFR parts 3, 31, and 52 continues to 
read as follows:

    Authority: 40 U.S.C. 121(c); 10 U.S.C. chapter 4 and 10 U.S.C. 
chapter 137 legacy provisions (see 10 U.S.C. 3016); and 51 U.S.C. 
20113.

PART 3--IMPROPER BUSINESS PRACTICES AND PERSONAL CONFLICTS OF 
INTEREST

0
2. Revise section 3.900 to read as follows:


3.900  Scope of subpart.

    This subpart implements various statutory whistleblower programs. 
This subpart does not implement 10 U.S.C. 4701, which is applicable 
only to DoD, NASA, and the Coast Guard.
    (a) 41 U.S.C. 4712 is implemented in 3.900 through 3.906. These 
sections do not apply to--
    (1) DoD, NASA, and the Coast Guard; or
    (2) Any element of the intelligence community, as defined in 
section 3(4) of the National Security Act of 1947 (50 U.S.C. 3003(4)). 
Sections 3.900 through 3.906 do not apply to any disclosure made by an 
employee of a contractor or subcontractor of an element of the 
intelligence community if such disclosure--
    (i) Relates to an activity of an element of the intelligence 
community; or
    (ii) Was discovered during contract or subcontract services 
provided to an element of the intelligence community.
    (b) Section 743 of Division E, Title VII, of the Consolidated and 
Further Continuing Appropriations Act, 2015 (Pub. L. 113-235) and its 
successor provisions in subsequent appropriations acts (and as extended 
in continuing resolutions), is implemented in 3.909, which is 
applicable to all agencies.
    (c) Section 3.907 of this subpart implements section 1553 of the 
American Recovery and Reinvestment Act of 2009 (Pub. L. 111-5), and 
applies to all contracts funded in whole or in part by that Act.

0
3. Amend section 3.901 by--
0
a. Adding in alphabetical order a definition for ``Abuse of 
authority'';
0
b. Removing the definition of ``Authorized official of an agency''; and
0
c. Revising the definition of ``Inspector General''.
    The addition and revision read as follows.


3.901  Definitions.

* * * * *
    Abuse of authority means an arbitrary and capricious exercise of 
authority that is inconsistent with the mission of the executive agency 
concerned or the successful performance of a contract of such agency.
* * * * *
    Inspector General means an Inspector General appointed under 
chapter 4 of title 5 of the United States Code and any Inspector 
General that receives funding from, or has oversight over contracts 
awarded for, or on behalf of, the executive agency concerned. This 
definition does not apply to 3.907.
* * * * *

0
4. Add section 3.902 to read as follows:


3.902  Classified information.

    41 U.S.C. 4712 does not provide any right to disclose classified 
information not otherwise provided by law.

0
5. Revise section 3.903 to read as follows:


3.903  Policy.

    (a)(1) Contractors and subcontractors are prohibited from 
discharging, demoting, or otherwise discriminating against an employee 
as a reprisal for disclosing, to any of the entities listed at 
paragraph (b) of this section, information that the employee reasonably 
believes is--
    (i) Evidence of gross mismanagement of a Federal contract;
    (ii) A gross waste of Federal funds;
    (iii) An abuse of authority relating to a Federal contract;
    (iv) A substantial and specific danger to public health or safety; 
or
    (v) A violation of law, rule, or regulation related to a Federal 
contract (including the competition for or negotiation of a contract).
    (2) A reprisal is prohibited even if it is undertaken at the 
request of an executive branch official, unless the request takes the 
form of a non-discretionary directive and is within the authority of 
the executive branch official making the request.
    (b) Disclosure may be made to the following entities:
    (1) A Member of Congress or a representative of a committee of 
Congress.
    (2) An Inspector General.
    (3) The Government Accountability Office.
    (4) A Federal employee responsible for contract oversight or 
management at the relevant agency.
    (5) An authorized official of the Department of Justice or other 
law enforcement agency.
    (6) A court or grand jury.
    (7) A management official or other employee of the contractor or 
subcontractor who has the responsibility to investigate, discover, or 
address misconduct.
    (c) An employee who initiates or provides evidence of contractor or 
subcontractor misconduct in any judicial or administrative proceeding 
relating to waste, fraud, or abuse on a Federal contract shall be 
deemed to have made a disclosure.

[[Page 69521]]


0
6. Revise section 3.904 to read as follows:


3.904  Complaints.

0
7. Add section 3.904-1 to read as follows:


3.904-1  Procedures for filing complaints.

    A contractor or subcontractor employee who believes that he or she 
has been discharged, demoted, or otherwise discriminated against 
contrary to the policy in 3.903 may submit a complaint with the 
Inspector General of the agency concerned. Procedures for submitting 
fraud, waste, abuse, and whistleblower complaints are generally 
accessible on agency Office of Inspector General hotline or 
whistleblower internet sites or the complainant may directly contact 
the cognizant Office of the Inspector General for submission 
instructions. A complaint by the employee may not be brought under 41 
U.S.C. 4712 more than three years after the date on which the alleged 
reprisal took place.

0
8. Add section 3.904-2 to read as follows:


3.904-2  Procedures for investigating complaints.

    (a) Investigation of complaints will be in accordance with 41 
U.S.C. 4712(b).
    (b) Upon completion of the investigation, the head of the agency 
shall ensure that the report of findings has been provided by the 
Inspector General to the head of the agency and to--
    (1) The complainant and any person acting on the complainant's 
behalf; and
    (2) The contractor and/or subcontractor alleged to have committed 
the violation.
    (c) The complainant, contractor, and/or subcontractor shall be 
afforded the opportunity to submit a written response to the report of 
findings to the head of the agency and the Office of Inspector General 
in a time and manner that permits the agency head to take action not 
later than 30 days after receiving the report, as required by 3.905-
1(a).

0
9. Revise section 3.905 to read as follows:


3.905  Remedies and enforcement of orders.

0
10. Add section 3.905-1 to read as follows:


3.905-1  Remedies.

    (a) Agency response to Inspector General report. Not later than 30 
days after receiving a report pursuant to 3.904-2, the head of the 
agency shall--
    (1) Determine whether sufficient basis exists to conclude that the 
contractor or subcontractor has subjected the employee who submitted 
the complaint to a reprisal as prohibited by 3.903; and
    (2) Either issue an order denying relief or take one or more of the 
following actions:
    (i) Order the contractor or subcontractor to take affirmative 
action to abate the reprisal.
    (ii) Order the contractor or subcontractor to reinstate the 
complainant employee to the position that the person held before the 
reprisal, together with compensatory damages (including back pay), 
employment benefits, and other terms and conditions of employment that 
would apply to the person in that position if the reprisal had not been 
taken.
    (iii) Order the contractor or subcontractor to pay the complainant 
employee an amount equal to the aggregate amount of all costs and 
expenses (including attorneys' fees and expert witnesses' fees) that 
were reasonably incurred by the complainant for, or in connection with, 
bringing the complaint regarding the reprisal, as determined by the 
head of the agency.
    (iv) Consider disciplinary or corrective action against any 
official of the executive agency, if appropriate.
    (b) Complainant's right to go to court. (1) Paragraph (b)(2) of 
this section applies if--
    (i) The head of the agency issues an order denying relief; or
    (ii)(A) The head of the agency has not issued an order--
    (1) Within 210 days after the submission of the complaint; or
    (2) Within 30 days after the expiration of an extension of time 
granted in accordance with 41 U.S.C. 4712(b)(2)(B) for the submission 
of the report to those stated in 3.904-2(b); and
    (B) There is no showing that such delay is due to the bad faith of 
the complainant.
    (2) If the conditions in either paragraph (b)(1)(i) or (ii) of this 
section are met--
    (i) The complainant shall be deemed to have exhausted all 
administrative remedies with respect to the complaint; and
    (ii) The complainant may bring a de novo action at law or equity 
against the contractor or subcontractor to seek compensatory damages 
and other relief available under 41 U.S.C. 4712 in the appropriate 
district court of the United States, which shall have jurisdiction over 
such an action without regard to the amount in controversy.
    (A) Such an action shall, at the request of either party to the 
action, be tried by the court with a jury.
    (B) An action under this authority may not be brought more than 2 
years after the date on which remedies are deemed to have been 
exhausted.
    (c) Admissibility in evidence. An Inspector General determination 
and an agency head order denying relief under this section shall be 
admissible in evidence in any de novo action at law or equity brought 
pursuant to 41 U.S.C. 4712.
    (d) No waiver. The rights and remedies provided for in 41 U.S.C. 
4712 may not be waived by any agreement, policy, form, or condition of 
employment.


0
11. Add section 3.905-2 to read as follows:


3.905-2  Enforcement of orders.

    (a) Whenever a contractor or subcontractor fails to comply with an 
order issued under 3.905-1(a)(2), the head of the agency concerned 
shall file an action for enforcement of the order in the U.S. district 
court for a district in which the reprisal was found to have occurred. 
In any action brought pursuant to this authority, the court may grant 
appropriate relief, including injunctive relief, compensatory and 
exemplary damages, and attorney fees and costs. The complainant 
employee upon whose behalf an order was issued may also file such an 
action or join in an action filed by the head of the agency.
    (b) Any person adversely affected or aggrieved by an order issued 
under 3.905-1(a)(2) may obtain review of the order's conformance with 
41 U.S.C. 4712 and its implementing regulations, in the U.S. court of 
appeals for a circuit in which the reprisal is alleged in the order to 
have occurred. No petition seeking such review may be filed more than 
60 days after issuance of the order by the head of the agency. Filing 
such an appeal shall not act to stay the enforcement of the order of 
the head of an agency, unless a stay is specifically entered by the 
court.


0
12. Revise section 3.906 to read as follows:


3.906  Contract clause.

    The contracting officer shall insert the clause at 52.203-17, 
Contractor Employee Whistleblower Rights, in all solicitations and 
contracts, except solicitations and contracts of DoD, NASA, the Coast 
Guard, or applicable elements of the intelligence community (see 
3.900(a)).


3.907-7  [Amended]

0
13. Amend section 3.907-7 by removing ``Reinvestment Act of 2009 in'' 
and adding ``Reinvestment Act of 2009, in'' in its place.

[[Page 69522]]

3.908  [Removed and Reserved]

0
14. Remove and reserve section 3.908.


3.908-1 through 3.908-9  [Removed]

0
15. Remove sections 3.908-1 through 3.908-9.

PART 31--CONTRACT COST PRINCIPLES AND PROCEDURES

0
16. Amend section 31.205-47--
0
a. In paragraph (a), in the definition of ``Costs'' by removing ``or 
others retained by the contractor to assist it;'' and adding ``or 
others retained by the contractor or subcontractor to assist it;'' in 
its place;
0
b. In paragraph (b) introductory text by removing ``law or regulation 
by the contractor'' and adding ``law or regulation by the contractor or 
subcontractor'' in its place;
0
c. In paragraph (b)(2) by removing ``either a finding of contractor 
liability'' and adding ``either a finding of contractor or 
subcontractor liability'' in its place;
0
d. In paragraph (b)(3)(i) by removing ``the contractor;'' and adding 
``the contractor or subcontractor;'' in its place;
0
e. In paragraph (c)(1) by removing ``between the contractor'' and 
adding ``between the contractor or subcontractor'' in its place;
0
f. In paragraph (c)(2)(i) by removing ``incurred by the contractor'' 
and adding ``incurred by the contractor or subcontractor'' in its 
place;
0
g. In paragraph (d)(1) by removing ``Federal contract; or'' and adding 
``Federal contract or subcontract; or'' in its place;
0
h. In paragraph (f) introductory text by removing ``connection with'' 
and adding ``connection with the following'' in its place;
0
i. In paragraph (f)(4) by removing ``the contractor'' wherever it 
appears and adding ``the contractor or subcontractor'' in its place;
0
j. Revising paragraph (f)(5);
0
k. In paragraph (f)(6) by removing ``contract'' and adding ``contract 
or subcontract'' in its place;
0
l. In paragraph (f)(7) by removing ``the contractor is'' and adding 
``the contractor or subcontractor is'' in its place; and
0
m. In paragraph (g) by removing ``the contractor'' wherever it appears 
and adding ``the contractor or subcontractor'' in its place.
    The revision reads as follows:


31.205-47  Costs related to legal and other proceedings.

* * * * *
    (f) * * *
    (5) Costs of legal, accounting, and consultant services and 
directly associated costs incurred in connection with the defense or 
prosecution of lawsuits or appeals between contractors or 
subcontractors arising from either--
    (i) An agreement or contract concerning a teaming arrangement, a 
joint venture, or similar arrangement of shared interest; or
    (ii) Dual sourcing, coproduction, or similar programs, are 
unallowable, except when--
    (A) Incurred as a result of compliance with specific terms and 
conditions of the contract or subcontract or written instructions from 
the contracting officer; or
    (B) When agreed to in writing by the contracting officer.
* * * * *


31.603  [Amended]

0
17. Amend section 31.603 by removing from paragraph (b)(15) ``incurred 
by a contractor'' and ``regulation by the contractor'' and adding 
``incurred by a contractor or subcontractor'' and ``regulation by the 
contractor or subcontractor'' in their place, respectively.

PART 52--SOLICITATION PROVISIONS AND CONTRACT CLAUSES

0
18. Revise section 52.203-17 to read as follows:


52.203-17  Contractor Employee Whistleblower Rights.

    As prescribed in 3.906, insert the following clause:

Contractor Employee Whistleblower Rights (NOV 2023)

    (a) This contract and employees working on this contract will be 
subject to the whistleblower rights and remedies established at 41 
U.S.C. 4712 and Federal Acquisition Regulation (FAR) 3.900 through 
3.905.
    (b) The Contractor shall inform its employees in writing, in the 
predominant language of the workforce, of employee whistleblower 
rights and protections under 41 U.S.C. 4712, as described in FAR 
3.900 through 3.905.
    (c) The Contractor shall insert the substance of this clause, 
including this paragraph (c), in all subcontracts.


(End of clause)


0
19. Amend section 52.212-4 by revising the date of the clause and 
paragraph (r) to read as follows:


52.212-4  Contract Terms and Conditions--Commercial Products and 
Commercial Services.

* * * * *

Contract Terms and Conditions--Commercial Products and Commercial 
Services (NOV 2023)

* * * * *
    (r) Compliance with laws unique to Government contracts. The 
Contractor agrees to comply with 31 U.S.C. 1352 relating to 
limitations on the use of appropriated funds to influence certain 
Federal contracts; 18 U.S.C. 431 relating to officials not to 
benefit; 40 U.S.C. chapter 37, Contract Work Hours and Safety 
Standards; 41 U.S.C. chapter 87, Kickbacks; 49 U.S.C. 40118, Fly 
American; and 41 U.S.C. chapter 21 relating to procurement 
integrity.
* * * * *


0
20. Amend section 52.212-5 by--
0
a. Revising the date of the clause;
0
b. Redesignating paragraphs (b)(4) through (64) as paragraphs (b)(5) 
through (65);
0
c. Adding a new paragraph (b)(4);
0
d. Redesignating paragraphs (e)(1)(ii) through (xxiv) as paragraphs 
(e)(1)(iii) through (xxv);
0
e. Adding a new paragraph (e)(1)(ii); and
0
f. In Alternate II:
0
i. Revising the date of the alternate;
0
ii. Redesignating paragraphs (e)(1)(ii)(C) through (W) as paragraphs 
(e)(1)(ii)(D) through (X); and
0
iii. Adding a new paragraph (e)(1)(ii)(C).
    The revisions and additions read as follows:


52.212-5  Contract Terms and Conditions Required To Implement Statutes 
or Executive Orders--Commercial Products and Commercial Services.

* * * * *

Contract Terms and Conditions Required to Implement Statutes or 
Executive Orders--Commercial Products and Commercial Services (NOV 
2023)

* * * * *
    (b) * * *
    __(4) 52.203-17, Contractor Employee Whistleblower Rights (NOV 
2023) (41 U.S.C. 4712); this clause does not apply to contracts of 
DoD, NASA, the Coast Guard, or applicable elements of the 
intelligence community--see FAR 3.900(a).
* * * * *
    (e)(1) * * *
    (ii) 52.203-17, Contractor Employee Whistleblower Rights (NOV 
2023) (41 U.S.C. 4712).
* * * * *
    Alternate II (NOV2023). * * *
* * * * *
    (e)(1) * * *
    (ii) * * *
    (C) 52.203-17, Contractor Employee Whistleblower Rights (NOV 
2023) (41 U.S.C. 4712).
* * * * *


0
21. Amend section 52.213-4 by--
0
a. Revising the date of the clause;

[[Page 69523]]

0
b. Removing from paragraph (a)(2)(vii) ``(SEP 2023)'' and adding `` 
(NOV 2023)'' in its place;
0
c. Redesignating paragraphs (b)(1)(i) through (xxi) as paragraphs 
(b)(1)(ii) through (xxii); and
0
d. Adding a new paragraph (b)(1)(i).
    The revision and addition read as follows:


52.213-4  Terms and Conditions--Simplified Acquisitions (Other Than 
Commercial Products and Commercial Services).

* * * * *

Terms and Conditions--Simplified Acquisitions (Other than Commercial 
Products and Commercial Services) (NOV 2023)

* * * * *
    (b) * * *
    (1) * * *
    (i) 52.203-17, Contractor Employee Whistleblower Rights (NOV 
2023) (41 U.S.C. 4712); this clause does not apply to contracts of 
DoD, NASA, the Coast Guard, or applicable elements of the 
intelligence community--see FAR 3.900(a).
* * * * *


0
22. Amend section 52.244-6 by--
0
a. Revising the date of the clause;
0
b. Redesignating paragraphs (c)(1)(iii) through (xxi) as paragraphs 
(c)(1)(iv) through (xxii); and
0
c. Adding a new paragraph (c)(1)(iii).
    The revision and addition read as follows:


52.244-6  Subcontracts for Commercial Products and Commercial Services.

* * * * *

Subcontracts for Commercial Products and Commercial Services (NOV 2023)

* * * * *
    (c)(1) * * *
    (iii) 52.203-17, Contractor Employee Whistleblower Rights (NOV 
2023) (41 U.S.C. 4712); this clause does not apply to contracts of 
DoD, NASA, the Coast Guard, or applicable elements of the 
intelligence community--see FAR 3.900(a).
* * * * *
[FR Doc. 2023-21321 Filed 10-4-23; 8:45 am]
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