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Posted at 11:49 AM ET, 02/23/2011

Government shutdown: What about contractors?

By Ed O'Keefe
shutdown
Federal workers marched outside the State Department on Jan. 3, 1995 to protest the partial federal government shutdown. (AP)

A potential government shutdown won't just impact employees collecting government paychecks, but could also severely impact hundreds of thousands of contractors and the companies employing them to provide goods and services to federal agencies.

Federal funding for government operations expires March 4, leaving President Obama and lawmakers less than two weeks to decide whether to pass a short-term funding extension, a measure that funds the government for the rest of fiscal 2011, or to partially shut down government operations as negotiations continue.

Though federal employees earned retroactive pay for time lost during previous shutdowns, many contractors didn't after the 1995 and 1996 shutdowns -- and Congress has never passed legislation compensating contracting firms for time and work missed, because the government has never relied on contracting as it does now.

With that in mind, representatives from hundreds of contracting firms met Wednesday morning at an event hosted by the Professional Services Council, a trade association for mid-sized firms working with government agencies.

"You will find there is a maze" of issues to consider, said John F. Cooney, a partner at Venable LLP who led Bill Clinton's administration through the mechanics of the previous government work stoppages. For example, agencies may determine that certain contractors working on a government project can report for work because they're conducting "essential" government tasks, but that other colleagues on the project have to stay home. Contracting firms might need to temporarily reassign furloughed workers or even suggest they go on paid vacation to avoid sitting on their hands during the impasse.

Alan Chvotkin, PSC's executive vice president and general counsel, presented a series of questions contractors need to start answering this week to properly prepare for any shutdown in the coming days. As you'll see below, the questions Chvotkin posed are complex and lack easy answers:

Do you know where your employees are?
• Might be different if you have workers at a government facility. They may be denied access during a shutdown. "You still need to know who's where and how to get in touch with them," Chvotkin said.
• Are people on official travel? "You'll have to tell them to get on the next flight back," Chvotkin said. Or, "Do you tell them to stay in the Bahamas a few extra days?" because it costs less for them to stay put. "There are no pure answers here."

• Employees on leave, vacation or sick leave should continue in that status.

What do you do with your employees in the meantime?
• Try to minimize the government's liability and your own by considering work reassignments. It may be possible to re-task employees to a related project that's not affected. There may be other projects where they may be used.
• Maybe reassign them to training. Get them to finish the mandatory training they haven't completed.
• Some may take vacation or leave. It's still compensable, but then they're not working so you don't run afoul of rules prohibiting voluntary work.
• Furlough: It's a last resort, but if there's no other work available, it may be necessary.
• Some workers may be required to be on "stand by" and not allowed to take on additional work due to the uncertain duration of a shutdown. This happens frequently with medical support personnel and others supporting deployed forces.

Do you need a federal employee in the office in order to complete your work?
• To approve payments?
• To accept deliveries of goods or services?
• To provide access to government facilities, personnel or information (including classified information)?
• For any other reason?

What kinds of costs are incurred that might be recoverable?
• Material/vendor costs
• Certain employee costs -- with or without an advance agreement.
• Recovery of "unabsorbed" overhead. (Cost incurred must be offset by insurance coverage paid.)
• Generally, no recovery of back pay or "consequential damages."
• Government ratification of intervening contractual actions.

Other questions to consider:
• Is your cash flow sufficient to accommodate a delay in payments?
• Can you fund B&P costs while waiting for delayed awards?
• Can you afford to pay your employees and not be reimbursed?
• What are the business implications of additional continuing resolutions for your key customers?
• What are any other potential implications?

Other things to remember:
• Analyze your current situations.
• Plan for multiple possible events.
• Document, document, document.
• Account, account, account.
• Mitigate where possible.
• Communicate before, during and after.

Leave your thoughts in the comments section below.

RELATED:
Federal Eye government shutdown coverage

By Ed O'Keefe  | February 23, 2011; 11:49 AM ET
Categories:  Contracting, Government Shutdown  
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Comments

There are an estimated 12 million contractors (yes not even the govt knows the real number) versus 2 million Federal civilian employees, a statistic I find absurd. A brief shutdown would be a good way to air out the federal contracting space and see what comes crawling out from under the wood work and if supporting those contracts is really necessary on an ongoing basis.

Posted by: Skippy21 | February 23, 2011 12:03 PM | Report abuse

You'd be amazed at the number of contractors working at DHS. It's in the thousands. My wife was one of them before her firm moved her to another account. It's funny...she said that most of the government employees she worked with couldn't do the work themselves and that she (my wife) wouldn't hire any of them.

Posted by: RB1019 | February 23, 2011 12:10 PM | Report abuse

Skippy,
You want to cut down on Government or contract workers, fine. But do it the right way. These employees are just like you with bills to pay, children and families to take care of, and a shutdown does nothing to change that. All it does it cause more problems for the economy and the people affected.

If you want to cut back then do it through the normal budget process. Contracts will end, employees laid off or RIF'd. It will hurt but at least the people won't be left in some kind of limbo where they can't go look for new employment but also can't get a paycheck. A shutdown where people are just waiting by the phone waiting for a call to go back to work (or be let go properly) and are left to spend savings or rack up credit card debt is just cruel.

Posted by: Bailers | February 23, 2011 12:19 PM | Report abuse

The authors have obviously never worked for a government contractor, particularly one of the many "beltway bandits." Furloughs will be the first -- not the last -- resort. Believe me.

Posted by: trt2539 | February 23, 2011 12:22 PM | Report abuse

Amazing. People are worried they won't be paid for not working.

If they're that important, they'll get overtime when they get back.

Posted by: getjiggly1 | February 23, 2011 12:25 PM | Report abuse

Many government contracts are already using obligated funds, sometimes from a previous fiscal year. In these circumstances, the work may continue and payments will eventually be made. However, those onsite in a closed government facility may need to find another place to work. And work needing approval from government oversight managers or access to government systems and data before a task can move forward will have to wait until the government can perform its duties or provide access again.

Posted by: Viewpoint2 | February 23, 2011 12:31 PM | Report abuse

So the Teaparty Taliban, in fact, will hurt their corporate patrons. Poetic justice.

Posted by: areyousaying | February 23, 2011 12:36 PM | Report abuse

OK. I'm convinced.

Maybe a government shutdown WOULD be a good thing.

Seriously, Washington spending is out of control.

Posted by: postfan1 | February 23, 2011 12:38 PM | Report abuse

Maybe the contractors should start a union? The government employees what their rights but can dismiss contractors without cause and in many cases dismiss contractors for pointing out government corruption.
I am pro-union but not in the case of government employees. Civil service is the worse adulteration of a union. Civil Service is a failed system where managers are protected more than the workers.
It promotes early retirement - The number one reason cities, towns, states and even the federal government is in the predicament it is in.
If our government officials had to work until normal retirement age we would not have the revolving door policy which moves six figure earning government officials into seven figure consulting jobs. Imaging if SEC officials could not work at say Goldman Sacks. Or retired Generals couldn’t work at say Northrop Grumman, Lockheed Martin, DynCorp, whichever company Blackwater rebranded themselves as.
If State and local employees worked until retirement age tax payers would be paying for one police force, not he working police force and the three retired police forces.
Carry it into the private sector. If the auto companies did not let their union members retire early the cost of producing a car would plummet. Which brings me to my point. Management loves early retirement. Early retirement gives management the ammunition to claim loose the unions or we will file bankruptcy. Early retirement is one of the greatest union busting tools of all time. And as we can see, it is about to work.

Posted by: DefenseAgainstWho | February 23, 2011 12:43 PM | Report abuse

I was working for a contractor during the '95 shut down. The company had a fixed contract that was paid in full at the start with paybacks if we missed our goals. This was a very large company (F100) and a very small contract $5m. We continued to work and be paid during the shut down. However when the contract was up for renewal it was changed from a pay up front to a pay as you go. Reason; the govt workers were pissed that we continued to work while they couldn't. The company made even more money with the pay as you go than the original contract. I t was common knowledge that the govt made the 1st contract and figured to drop a huge backlog of jobs on us and we would not be able to perform to govt requirements. The govt was wrong we replaced 25 govt workers with 16 contract workers, cleared th backlog and did more work and produced better than the govt ever had.

Posted by: g30rg3544 | February 23, 2011 12:46 PM | Report abuse

But if not for the contractors, who would do the work? Surely not federal employees.

What people should be asking is why do we need contractors when we have employees? The answer is, you cannot make federal employees work; nor state for that matter.

Posted by: hebe1 | February 23, 2011 12:59 PM | Report abuse

This is not going to happen. The Republicans have too many people on the contractor doll to let it go down. Just a stunt people, relax.

Posted by: DPoniatowski | February 23, 2011 1:04 PM | Report abuse

Amazing. People are worried they won't be paid for not working.

If they're that important, they'll get overtime when they get back.

Posted by: getjiggly1 | February 23, 2011 12:25 PM

Gee another example of somebody who has no clue , but does not get deterred by ignorance. Just to enlighten you: A lot of people who are contractors are exempt employees, who do not get overtime. So save us your mean, vitriolic comments and maybe get some facts first before you make some more asinine comments.

Posted by: pabloemma1 | February 23, 2011 1:15 PM | Report abuse

Many contractors are in war zones who are putting their lives on the line daily just by being there. Are their families at home going to be left out in the cold with bills and no income?

Giving Billionaires a Hundred Billion in tax breaks while thousands of American men and women troops are dying and experiencing daily casualties in the Middle East - Priceless.

Cutting child nutrition, education, public safety, NPR, the EPA, Americorps Jobs, immigration and border enforcement so Rich Oil, Coal, Agricultural and Medical insurance and drugs Conglomerates and Billionaire Koch brothers and FAUX news Rupert Murdoch can buy more Yachts, Mansions and Villas - Priceless.

Posted by: Airborne82 | February 23, 2011 1:18 PM | Report abuse

here is where we actually find the absurdity of the claim that the federal govt. is too large. With maybe 2 million employees and 12 million contractors, it is clear that the the govt., causes the employment of over 24 million people with most being in the private sector. Anyone who works for the govt., knows that it practically keeps many companies, small and large afloat. yet, the media not only listens, but continues to perpretrate the myth of "big government." This does not even take into considerations the thousands of small services companies, (resteraunts, gift shops, etc., that in many places rely on the government workforce to support them. Lastly, I would ask, what exactly are we to say to those "real people" who many are asking to be fired? Oh my, there goes the unemployment issue again, and what about the affect on mortgages (i.e. increase in foreclosures). The pending government shutdown is really just the tip of the problem, spurred on by a lack of understanding of what the federal governemtn does, as well as by the media's refusal to call dumb, stupid, suggestions, not to mention outright lying, exactly what they are. (Just my thoughts)

Posted by: LifeLong | February 23, 2011 1:23 PM | Report abuse

End that $160~$200 Billion over 10 years to Rich farming conglomerates. These corporations earn Billions without taxpayer subsidies and lavish those earnings on their investors at taxpayer expense.

Recipients of Total USDA Subsidies to farms in United States totaled $16,349,000,000 in 2009;

http://farm.ewg.org/top_recips.php?fips=00000&progcode=total&page=0&yr=2009

Massey Energy, paid an average of 5.6 percent of its profits in federal income taxes over the last three years, despite large profits (1/6th of federal 35% rate).
http://www.wvpolicy.org/downloads/news_releases/NR041510.pdf

Ordinary taxpayers are the ones who have to make up the difference by paying 20~30% of their salary in taxes to offset Billions in explorations tax subsidies for wealthy coal companies who lavish their investors with profits built on their ability to pollute at public expense.

A recent Harvard study “Full cost accounting for the life cycle of coal” found that the lifecycle of coal coast Americans $300~500 Billion a year (17.8cents/KWh).

http://www.energyboom.com/yes/harvard-study-estimates-coal-power-has-300-500-billion-hidden-costs

$4 to $6 Trillion is the cost for the Wars in Iraq and Afghanistan:

http://www.washingtonpost.com/wp-dyn/content/article/2011/02/17/AR2011021705822.html

“The Pentagon reported in November (2010) that suicide rates are soaring among veterans; the backlog at the Department of Veterans Affairs had reached more than 700,000 disability cases,”

“the costs of Iraq and Afghanistan, including interest payments on the money borrowed for these wars and care for our wounded soldiers and veterans, is likely to total $4 trillion to $6 trillion”

American's are doing all they can to protect the riches of Billionaires while racking up Trillions in Defense and War spending debt which no one is paying for. What a racket.

Posted by: Airborne82 | February 23, 2011 1:30 PM | Report abuse

Let's just close the doors, turn off the light and see what happens. The service at my local IRS office is bound to improve.

Posted by: richard36 | February 23, 2011 1:38 PM | Report abuse

Let's just close the doors, turn off the light and see what happens. The service at my local IRS office is bound to improve.

Posted by: richard36
_______________________

Yeah, that sounds good. When do you expect that refund for your tax return?

Posted by: Bailers | February 23, 2011 1:44 PM | Report abuse

Lets send the air traffic controllers home, along with DHS folks working immigration at the airports after the last plane lands and see who is crying.

Feds stop badmouthing. The rank and file bust their collective asses. Its the incompetent SESers and political appointees that make their lives difficult.

If you really want to make the govt operate more effectively have them cut the number of lawyers by 50%.

Posted by: sheepherder | February 23, 2011 1:46 PM | Report abuse

Contractor's working on fixed price contracts with funds already appropriated and obligated to their contracts will be paid even if the Government foolishly locks them out of their assigned work sites. Those of us in that kind of situation will very likely continue to work and perform the services for which we have been contracted. There are many mindless things which happen in the Government and many good things. Shutting down the Government is not the way to address the deficit problem, but it may be all the our feeble Congress is capable of doing. Shame on them if they do not compromise while reducing expenditures. Both parties have some growing up to do, so to speak.

Posted by: Arlington4 | February 23, 2011 1:54 PM | Report abuse

@DefenseAgainstWho - you obviously don't know anything about unions, let alone government unions. Government unions do not protect managers - they don't belong to a union. Many of your "issues" involve the union, non-manager employee - please get it right.

The idiocy of saying "maybe contractors should start a union" only highlights your ignorance about unions and acquistion laws. Unions=contracts (don't you read?) Government contractors are already under a defined contract and doesn't fall under collective bargaining; if the contract is set at one price with no additional caveats/protections on pay built in, they have no recourse during a government shutdown, their time is wasted and they will most likely not see any money. But than what does the tea party care about truth, they prefer to tout themselves as the perfect physicians without having any education about the impact of their decisions.

Posted by: devilsadvocate3 | February 23, 2011 1:55 PM | Report abuse

RB1019, I am sure you wife is real Einstein. But I doubt she is as smart as you think. Contractors are not that smart. All the ones I have ever worked with are totally incompetent. I have been around 12 years and would never hire any of the contractors I have worked with. Child Please.

Posted by: cbaxter13 | February 23, 2011 2:26 PM | Report abuse

Skippy is correct as an article from the WAPO in '06 states:

http://www.washingtonpost.com/wp-dyn/content/article/2006/10/05/AR2006100501782.html

100s of billions of dollars annually go to this hidden workforce of contractors. A scam by the GOP to make govt look small and efficient when it is the opposite; thus a lie. But then again we're talking about the GOP . . . would you trust any of them?

GOP = another shinning lie. See: Ronald Reagan.

Posted by: Slipjac | February 23, 2011 2:52 PM | Report abuse

If Americans are so concerned about a government shutdown, why is Congress taking a recess rather than staying in town and hammering out a budget that can make the vote?

We're told our government should be run like a business.

What other business in this country shuts down for a week before a major deadline of a project that has at least a dozen re-writes?

None that I know of!!!!!

If the budget isn't hammered out by the time recess rolls around, recess should be postponed until the job is done.

Posted by: asmith1 | February 23, 2011 2:59 PM | Report abuse

While I have no desire to see a government shutdown, if one occurs I think the government leadership should be a rigorous as possible in limiting the defination of "essential" employees and functions. Rather than working to minimize the impact of the shutdown, work to maximize it. Show for once and for all what the federal government does; if the citizenry wants to get the government so small you can drown it in a bathtub, fine, but at least they'll understand what they're asking for. This approach to a shutdown would demonstrate the impact of such a downsizing.

Posted by: FLTransplant | February 23, 2011 3:13 PM | Report abuse

I cannot believe your comment! You are the worst! A true ignorant idiot if there ever was one. How can you write that with a straight face. Perhaps you think it is funny to be that offensive. I hope you get what you truly deserve.

Posted by: goodtoknow | February 23, 2011 3:29 PM | Report abuse

To cbaxter13...

My wife is top one percent in her field nationwide. She turned down an SES position. As talented as she is, she and her team still couldn't fix DHS's books! 18 years as a fed. Many talented people working for the G, but just as many morons.

Posted by: RB1019 | February 23, 2011 3:44 PM | Report abuse

Wow, top 1% of her field? Pretty impressive. What field might that be, high school senior? What occupation ranks workers in percentages? You both sound very humble.

Posted by: marylandarlington | February 23, 2011 4:03 PM | Report abuse

I understand that many of the extras in "Night of the Living Dead" were federal workers.

Posted by: devilsadvocate2 | February 23, 2011 4:16 PM | Report abuse

Contractors: "Let them eat cake"!

Feds: "We keep you alive to serve this ship, row well and live".

Posted by: TippyCanoe | February 23, 2011 4:38 PM | Report abuse

Haha. Compensate the contractors for lost time? It is ridiculous to even mention. If we don't work for two weeks, the only pay we'll get is from burning vacation time. Meanwhile the feds will get retroactive pay for their 2 week vacation.

Posted by: BurtReynolds | February 23, 2011 4:59 PM | Report abuse

A government shutdown over the deficit brewing and oil hitting a $100.00 a barrel today plus union bashers out to destroy unions. This includes a few republican governors, NOW, not good news at all for the American citizens. We have some citizens who are living the high life considering our problems. The rich are enjoying their extended 800 billion dollar tax break while the banks are passing out millions in bonus money. The stock market was doing fine until the Arabs went nuts, it's been down lightly. Now I'm not a doomsday person but I sense real trouble, (flash) Libya just cut their oil production probably due to the riots, YOU KNOW WHAT THAT MEANS. How does another recession sound. ???

Posted by: shipfreakbo214 | February 23, 2011 5:28 PM | Report abuse

As a contractor I have noticed a couple of things around the government site.
The contractors have to work to get paid.
Government employees don't have to work to get paid and I have seen too many that prove that point.
Just the way it is............

Posted by: LarryinMD | February 23, 2011 5:49 PM | Report abuse

Time: Government Shutdowns In 1995-96 Reportedly Cost At Least $800 Million.

http://www.time.com/time/specials/packages/article/0,28804,1974334_1974337_1974203,00.html#ixzz0yBXyGo8a1

This, after they jam a $700 billion extra tax cut for the top two percent down our throats?

republicans won't be happy until you can hold roll call for the middle class in a phone booth

Posted by: losthorizon10 | February 23, 2011 5:49 PM | Report abuse

The Republican are dishonest and insane. If they really wanted to cut spending instead of playing politics there would be many better ways to do it. Maybe it will take a shutdown of the Gov. for several weeks to wake up people to vote out the wingnuts, Beckerheads and Tea Baggers that have taken over our Republican party.

Posted by: changeisconstant | February 23, 2011 6:07 PM | Report abuse

This is a classic business planning article !

Posted by: peterroach | February 23, 2011 6:20 PM | Report abuse

RB1019 "My wife was one of them before her firm moved her to another account. It's funny...she said that most of the government employees she worked with couldn't do the work themselves and that she (my wife) wouldn't hire any of them"

I'm surprised with the comment made by your wife. We have in our office two wonderful contractor workers but have had horrible experiences from past contractors that ended up costing government more money to clean up the mess. I really wish people would stop projecting negative images of federal employees. Most of us can do the work we are hired to do and for those who can't we pray for change.

Posted by: liseja12 | February 23, 2011 6:22 PM | Report abuse

I am a contractor. We will not get paid unless we use vacation or sick time. I have only been working 6 months for this company, so I have not earned much paid time off. My husband is a laid off electrician and leaving the state tomorrow to look for work AGAIN. We have 2 kids and have exhausted our savings during this recession. If I miss one pay check, we don't eat, two checks were screwed.

Posted by: jneill7854 | February 23, 2011 6:23 PM | Report abuse

Hold on here. If you are employee of a contracting company then they have to pay you, they have to eat the loss. After all you don't get to keep the extra profit on the contract, and are not an owner in the company. If you are 1099 or corp-to-corp then you do not get paid as you are not an employee.

Posted by: info81 | February 23, 2011 7:24 PM | Report abuse

" We have 2 kids and have exhausted our savings during this recession. If I miss one pay check, we don't eat, two checks were screwed.

Posted by: jneill7854 | February 23, 2011 6:23 PM "


One question...do you vote Democrat or Republican?

Posted by: jato11 | February 23, 2011 7:43 PM | Report abuse

The majority of the decent work being done in the federal government these days is being done by contractors. If all the contractors are laid off the utter uselessness of America's actual federal workforce will be laid bare to the world.

Posted by: BrRandall | February 23, 2011 7:46 PM | Report abuse

interesting factoid

in 1962 there were 5.35 M federal employees. In 1988 (end of reagan administration) there were 5.29 M federal employees, in 2000 (end of clinton ) there were 4.12 M federal employees, and in 2008 there were 4.20 M employees. So there are fewer federal employees despite a population increase from 186 M in 1962 to ~310 M people in 2010. Don't quite understand how this has caused the budget problems.

Posted by: chet_brewer | February 23, 2011 7:58 PM | Report abuse

And a government shutdown will prove what exactly? That our elected representatives refuse to face facts? They will neither reduce government program expenses nor raise taxes. Oh, the right wing will posture with proposals to ban dollars flowing anywhere within 500 miles of an abortion, to defund WIC, food stamps, Public Television, and Cadillacs for Welfare Queens. And the left wing will posture with promises to freeze spending at 2008 levels (prior to the complete necessary/unnecessary bank bailouts, according to taste) during the foreseeable future, with just a dollop of new spending on fancy things like high speed rail. One thing is certain: the right wing wants to end tax money going to help Americans cope with Capitalism. All the money corporations earn is to be funneled to key employees at the top of the corporate heap (executive-level management). Every owner, employee, and customer of corporations will get the shaft.

Posted by: BlueTwo1 | February 23, 2011 9:29 PM | Report abuse

About time we expose our shadow government!!

I get it. Really, I do. Civil servants must do their part to help our state and our country do what they must to help solve this economic crisis. If a two-year pay freeze can help, so be it.

If members of Congress were truly concerned about cutting the deficit, they need to look across the board. Most notably, they need to start looking at our "shadow government" of private contractors. In 1960 the U.S. population was 179 million, with a federal executive service of 1.9 million employees. Today we have a population of 300 million-plus, with a federal executive service of 1.9 million.

What has happened is an escalation of private contracting for government services. It is estimated that there are now more than 10 million privately contracted employees working for the U.S. government. The term "private contractor" is a bit of a misnomer, considering most of these businesses make 100 percent of their money from the taxpayers.

In a report to the U.S. Senate in 2002, Dan Guttman, a fellow at the Washington Center for the Study of American Government at John Hopkins, stated, "We have a government the bulk of whose workforce is invisible to citizens, press and too often even to Congress and the highest ranking political appointees. Notwithstanding conflict of interest disclosure requirements, the few public reviews of the process indicate that too often contractors are hired without due regard for potentially conflicting interests."

In 2003 the Army did a study of 30,000 of its contract workers. It found that work force cost them roughly $9.5 billion. That's more than $316,000 per contract employee. This doesn't even begin to address the no-bid contracts that are still being awarded today.

By comparison, federal civil servants are a bargain. Not considering any locality payment, the lowest paid federal worker (GS-01, step 1) makes $17,803 per year, or $8.53 an hour. That's $1.28 per hour more than the lowest state minimum wage, but 14 cents per hour less than the highest state minimum wage.

The median paid federal worker - GS-10, step 5 - makes $52,875 per year. The highest paid federal worker, not elected or appointed to a senior executive service position - a GS-15, step 10 - makes $129,517 per year. The difference between the highest and the lowest is $111,714 per year. Now, compare that difference to any large company in the private sector, and I dare to guess you will see a much wider disparity between top management and the employee sweeping the floors.

If we are to have a fair and open discussion about the true costs of government and the sources of our growing deficits, this shadow government that has burgeoned over the decades needs to be brought into the light.

Posted by: jhost | February 24, 2011 10:04 AM | Report abuse

Does the shadow government work for the democrats or the republicans???

It costs 3 billion dollars for 10,000 private contractors (Shadow Government) or 300 billion for 1,000,000 of our private government employees per year.

The information that we have access to suggests that there are over 12 million private government employees plus or minus a million.

These costs per employee are based on a report from information gathered in a survery from the U.S. Army for 30,000 private government employees which worked out to be 316,000 tax payer dollars per year per empolyee. In other agencies who knows what it costs, but I will just stick to the averages and what we know. Imagine the army has to do a survey to figure out what they are paying for private labor. Would you hire there budget folks or are they private contractors?

If congress was to cut just 10% of our private government employees(Shadow Government) we would be looking at a 300 billion dollar savings.

Beats the heck out of 4 billion in food stamps. Or is it just me???

Posted by: jhost | February 24, 2011 12:56 PM | Report abuse

The Democrats are dishonest and insane. If they really wanted to cut spending instead of playing politics there would be many better ways to do it.

Maybe it will take a shutdown of the Gov. for several weeks to wake up people to vote out the wingnuts, radicals and Union ass-kissers that have taken over our Democratic party.

Posted by: jmverrier | February 24, 2011 1:23 PM | Report abuse

If the Democrats had done their actual jobs when in control of the House, this wouldn't be an issue.

Posted by: getjiggly1 | February 24, 2011 3:56 PM | Report abuse

DHS wouldn't even have a workforce if it wasn't for contractors. More than half of the new hires in all three of the organizations I've worked in over the past several years have been poached from contractors already working on site. I've lost several of my own staff to Fed jobs - they take pay cuts because they are offered they are offered Fed jobs that they know they will never get fired from!

Posted by: aat04 | February 24, 2011 4:13 PM | Report abuse

But if not for the contractors, who would do the work? Surely not federal employees.

What people should be asking is why do we need contractors when we have employees? The answer is, you cannot make federal employees work; nor state for that matter.

Posted by: hebe1 | February 23, 2011 12:59 PM | Report abuse


I am a federal employee - I do work hard and do my job well, although it is difficult at times. Are there govt. workers who don't work hard and don't do a good job? You bet, just as in any workplace. We see some of the bad ones on the news, and their poor choices taint the rest of us by association.

As to why does the government hire so many contractors? Here is one reason - Because it looks good on paper. More contractors means less government employees. When reports are run to show numbers of government employees there won't be much, if any, increase in totals from one year to the next....even though there may be twice as many contractors hired each year. All that matters to administrators is being able to point to the bottom line and show no increase in govt. hiring....regardless of the fact that hiring contractors often carries with it hefty contract fees, I have seen upwards of 60% personally, so contracting out is also not always cost-effective either.

Posted by: Trudi1 | February 24, 2011 6:04 PM | Report abuse

Contracts are too often made on a cost plus basis. Consequently, too many contractors raise their costs extravagantly for more profit.

Posted by: yogiman70 | February 27, 2011 8:52 AM | Report abuse

The White House should publish guidance for handling the shut down.

This should include military operations, contractor support such as security services, and clearly state who will be paid for work performed during a shut down, and who will not be paid for work performed in good faith.

Most contractors were not paid in the last shut down, even those who were told they would be, or who were told there were essential personnel and had to report to work anyway.

Sooner is better than later. Getting the guidance out Monday will enable people to handle matters more effectively, than waiting until Friday after Panic has set in.

Cheers

Posted by: lb2123 | February 27, 2011 5:33 PM | Report abuse

You'd be amazed at the number of contractors working at DHS. It's in the thousands. My wife was one of them before her firm moved her to another account. It's funny...she said that most of the government employees she worked with couldn't do the work themselves and that she (my wife) wouldn't hire any of them.

Posted by: RB1019
-------------------------------------
Interesting comment RB1019, because most of those contractors were converted to government employees which basically means that they "couldn't do the work"...if your wife were to look really closely, she might find that she is one of "them." Trust me I know...I work for DHS and I know that many of the contractor employees don't know their azz from a hole in the ground...and they talk about federal workers are bad, SMH...

Posted by: Beingsensible | March 1, 2011 2:27 PM | Report abuse

I was working for a contractor during the '95 shut down. The company had a fixed contract that was paid in full at the start with paybacks if we missed our goals. This was a very large company (F100) and a very small contract $5m. We continued to work and be paid during the shut down. However when the contract was up for renewal it was changed from a pay up front to a pay as you go. Reason; the govt workers were pissed that we continued to work while they couldn't. The company made even more money with the pay as you go than the original contract. I t was common knowledge that the govt made the 1st contract and figured to drop a huge backlog of jobs on us and we would not be able to perform to govt requirements. The govt was wrong we replaced 25 govt workers with 16 contract workers, cleared th backlog and did more work and produced better than the govt ever had.

Posted by: g30rg3544
-------------------------------------
Liar...there's no such thing as a "fixed contract that's paid in full at the start with paybacks if goals are missed." In fact the funding on a fixed price contract is obligated at contract award, but payments are made monthly. And if the contract was "recompeted" and your company won and the terms and conditions were changed from fixed price to cost reimbursable, I'm pretty certain it had nothing to do with your successful delivery under the fixed price contract. Contractors loath fixed price contract and if the government could successfully award a fixed price contract over a cost reimbursable contract then they would, because the risk in a fixed price contract is on the contractor and not the government. Under a cost reimbursable contract the contractor is paid all of his cost and a pre-determined fee...so stop lying--the fact that you do basically means that you are simply a teabagging public service worker hater...those of your ilk are the reason we are in this mess today...

Posted by: Beingsensible | March 1, 2011 2:46 PM | Report abuse

I was working for a contractor during the '95 shut down. The company had a fixed contract that was paid in full at the start with paybacks if we missed our goals. This was a very large company (F100) and a very small contract $5m. We continued to work and be paid during the shut down. However when the contract was up for renewal it was changed from a pay up front to a pay as you go. Reason; the govt workers were pissed that we continued to work while they couldn't. The company made even more money with the pay as you go than the original contract. I t was common knowledge that the govt made the 1st contract and figured to drop a huge backlog of jobs on us and we would not be able to perform to govt requirements. The govt was wrong we replaced 25 govt workers with 16 contract workers, cleared th backlog and did more work and produced better than the govt ever had.

Posted by: g30rg3544
-------------------------------------
Liar...there's no such thing as a "fixed contract that's paid in full at the start with paybacks if goals are missed." In fact the funding on a fixed price contract is obligated at contract award, but payments are made monthly. And if the contract was "recompeted" and your company won and the terms and conditions were changed from fixed price to cost reimbursable, I'm pretty certain it had nothing to do with your successful delivery under the fixed price contract. Contractors loath fixed price contract and if the government could successfully award a fixed price contract over a cost reimbursable contract then they would, because the risk in a fixed price contract is on the contractor and not the government. Under a cost reimbursable contract the contractor is paid all of his cost and a pre-determined fee...so stop lying--the fact that you do basically means that you are simply a teabagging public service worker hater...those of your ilk are the reason we are in this mess today...

Posted by: Beingsensible | March 1, 2011 2:48 PM | Report abuse

DHS wouldn't even have a workforce if it wasn't for contractors. More than half of the new hires in all three of the organizations I've worked in over the past several years have been poached from contractors already working on site. I've lost several of my own staff to Fed jobs - they take pay cuts because they are offered they are offered Fed jobs that they know they will never get fired from!

Posted by: aat04
-------------------------------------
Not sure I understand what your problem is on this issue...is it that you lost employees to the government? You're correct, DHS does have a high number of contractor support personnel, and yes we do hire some of them as full-time employee after they have "applied" for positions. Now you didn't say that you "fired" these employees...you said DHS "took" some of your employees. Surely you thought they were good employees when they worked for you...given that you did not "fire" them, so why then would you expect DHS to fire them?...hummm you sound like a disgruntled employer who is losing employees to DHS for lower wages...would you say...

Posted by: Beingsensible | March 1, 2011 2:57 PM | Report abuse

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