At Last, Some Relief for DOE Contractors

For the past few years, the Department of Energy (DOE) has taken an extremely literal approach to contractors claiming overtime for employee training purposes. FAR 31.205-44(a) , Training and Education Costs, states that overtime compensation for training and education is unallowable. DOE has taken the position that there can be no exceptions to this rule. It didn't matter whether a contractor could show that it was more cost effective to pay overtime for training than to hire additional staff to cover contract-required services. It didn't matter that certain training was specifically mandated by contract and not discretionary. It didn't matter that the training contributed significantly to contractor employee health and safety. Contractors had to find a way to do all of this without incurring overtime.

More than a few DOE contractors have conducted specific analyses showing that there are circumstances where incurring overtime cost the Government less in the long run. When presented to DOE contracting officers however, they have stood firm in their interpretation that overtime for any kind of training was unallowable. Actually, some contracting officers were sympathetic and wished that they had the discretion to authorize overtime for training thus saving taxpayer dollars but found that there was no way to satisfy their overseers if they broached the subject.

Someone in DOE headquarters finally took some initiative and authorized a Class Deviation to FAR 31.205-44(a). You can read all of the details here but essentially, it authorizes overtime for training purposes so long as the contractor has written approval from an agency approving official (typically a contracting officer). Additionally, approval is required before the costs are incurred. Contractors are expected to submit requests with sufficient justification to gain contracting officer approvals.

The Class Deviation applies to existing contracts as well as future contracts so that contractors in the midst of a multi-year contract will be able to benefit.

No word yet on whether other agencies will follow suit. Possibly not because we are not aware of any other agency that has taken similar positions to that of DOE rank and file.