Our company has a large IDIQ contract where tasks are frequently being awarded. Often times, we are able to negotiate rates on these new task awards based off of current market value. We are currently able to keep the salaries generally similar with a few justifiable exceptions. However, the current job market for certain labor categories is VERY competitive. Companies are paying higher than market value to attract employees. This, of course, creates an issue for us when it comes to retention and negotiation of salaries for new employees. We believe we will be able to obtain an equitable adjustment from the government on our rates but need to be able to attract new talent until that adjustment is granted.

So, my questions are these:
1. How can we justify a higher salary for employees on the new task who have the same labor category, description, education, and experience requirements as those on older tasks until the equitable adjustment comes through?
2. If we are audited during the time we are waiting for the adjustment, will we be found to be non-compliant?

Also, we have been reading the new OFCCP guidelines. How does a company create a PAG if there are less than 20 employees in any one group?

1 Answer