Chaedrol GAO Protest Log 20240924: MAXIMUS, GTMR, Owens & Minor et al.
Three interesting cases: (1) allowability of a labor harmony agreement that prohibits CMS’s contact-center workforce from striking, (2) GTMR where a SeaPort sub’s bid withstands apparently steep eligibility odds; and (3) yes, of course ODCs count as part of award value for GAO order threshold purposes.
MAXIMUS Federal Services, Inc. (B-422676)
You should care.
Category: Labor Harmony Agreement
Date: September 16, 2024
URL: https://www.gao.gov/products/b-422676
In this unusual protest, Maximus protests the RFP for its incumbent work because of the inclusion of a labor harmony agreement clause. The LHA is a written agreement between the contact center operator and its labor organizations to prohibit members from striking. The protester argued that the LHA clause was unreasonable, violated the Labor Management Relations Act, and was ambiguous regarding negotiation timelines.
- LHA clause unreasonableness: Maximus argued the clause violated the clause violates the Labor Management Relations Act or was preempted by the National Labor Relations Act. GAO dismissed stating it does not review such violations as they fall outside “procurement law or regulation.”
- Conflict with FAR: GAO found no violation of FAR § 22.101-1.
- Restrictive of competition: GAO ruled that the LHA clause did not unduly restrict competition by favoring contractors with union workforces, affirming that it aligned with the agency's operational needs.
- Ambiguity of the clause: GAO sustained this aspect of the protest “on the narrow ground that the solicitation is ambiguous as to the length of time the apparent successful offeror will have to negotiate an LHA with any labor organization demonstrating intent to represent service employees under this contract.”
The protest was partially sustained concerning the ambiguity of the LHA clause, while the other claims were denied. Clearly, the incumbent could not persuade its client to remove the clause preaward and felt backed into the legal-action corner. As always, that’s a business judgment based on trusted legal advisement.
Digest
1. Protest that a “labor harmony agreement” (LHA) clause is unreasonable because it violates the Labor Management Relations Act and is preempted by the National Labor Relations Act is dismissed because our Office does not review violations of or preemption by those statutes.
2. Protest that an LHA clause is unreasonable because it violates or is not authorized under Federal Acquisition Regulation 22.101-1 is denied where the clause does not violate or conflict with the authority provided under that regulation.
3. Protest that the LHA clause is unduly restrictive of competition is denied where the clause is consistent with the agency's needs and does not otherwise limit competition.
4. Protest that the LHA clause is ambiguous is sustained where the clause does not reasonably articulate the period of time during which an apparent successful offeror will have to negotiate a pre-award LHA with any qualifying labor organization.
Global Technology and Management Resources, Inc. (B-422333.2, B-422333.3)
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Category: Task Order Competition
Date: September 18, 2024
URL: https://www.gao.gov/products/b-422333.2%2Cb-422333.3
In a surprising turn, a noncontract-holder was deemed an eligible bidder for a task order under said contract, specifically Secise, LLC’s eligibility to receive a SeaPort NxG task order despite not holding a spot on the IDIQ contract. The protester, Global Technology and Management Resources, contended that Secise's proposal should have been deemed ineligible because Secise was not a direct holder of SeaPort NxG. GAO analyzed the contract terms, which allow for affiliated companies to participate in the solicitation process. GAO concluded that the Navy's award to Secise was permissible under the contract's provisions that allowed the use of an affiliated company's proposal through the prime contractor's account.
Additionally, GTMR raised concerns about compliance with the limitation on subcontracting clause, asserting that the proposal indicated a potential violation. However, GAO found that the proposal was compliant on its face, as it demonstrated that Secise, as a small business protégé, would perform the required work without exceeding the subcontracting limitation.
GAO denied the protest.
Digest
Protest challenging the awardee's eligibility for the issuance of a task order is denied where the terms of the indefinite-delivery, indefinite-quantity contract specifically permit the awardee's submission of a proposal through the contract of an affiliated company.
Owens & Minor Distribution, Inc.; Cardinal Health 200, LLC; Concordance Healthcare Solutions (B-422689)
You should care.
Category: Discussions
Date: September 16, 2024
GAO denied protests filed by Owens & Minor Distribution, Inc., Cardinal Health 200, LLC, and Concordance Healthcare Solutions challenging the Department of Veterans Affairs’ issuance of delivery orders to Medline Industries, LP. The protests arose under the VA’s Medical/Surgical Prime Vendor Gen-Z V1 program, which provides distribution and supply management of medical and surgical supplies to VA facilities. The protesters alleged improper evaluation of technical proposals, flawed responsibility determinations, and inadequate evaluation of potential organizational conflicts of interest.
GAO found that VA’s evaluations were reasonable and consistent with the solicitation criteria. GAO also confirmed its jurisdiction over the protests, rejecting VA’s jurisdictional argument for dismissal that the orders fell below the IDIQ protest threshold of $10 million (for civilian agencies, and $25 million for defense) excluding pass-through payments (of course they count, GAO found). Yet GAO upheld VA’s evaluation approach and affirmed that VA was not required to investigate potential business integrity issues with the awardee.
Lastly, supplemental protests on OCI grounds were dismissed as they mirrored previously dismissed, untimely arguments. GAO concluded that Medline’s proposals were the most technically advantageous and offered the best value, affirming the award of the delivery orders to Medline.
Digest
1. GAO has jurisdiction to consider protests of the issuance of delivery orders notwithstanding that the total evaluated prices fall below the relevant jurisdictional threshold where the total awarded values of the orders include additional funds to reimburse the awardees for costs to be paid to authorized suppliers and such costs are not merely pass‑through payments.
2. Protests challenging the agency’s evaluations of proposals are denied where the agency’s evaluations were reasonable and in accordance with the solicitations.
3. Protests challenging the agency’s affirmative responsibility determinations are denied where the agency considered matters alleged to have been ignored or where the protester fails to demonstrate that the agency knew or had reason to know of them.
4. Supplemental protests alleging that the agency failed to reasonably evaluate for organizational conflicts of interests are dismissed where those allegations are materially indistinguishable from the protester’s initial related arguments that were previously dismissed as untimely.
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