DOD Gives Relief to Defense Contractors during COVID-19 Outbreak

Defense Contractors Receive Reimbursement for Certain Paid Leave Requirements

On April 8, the Department of Defense (DOD) issued a Class Deviation allowing for contracting officers to reimburse defense contractors for certain paid leave requirements related to the COVID-19 outbreak. While AGC called on Congress to support compensation for all federal contractors during the COVID-19 outbreak, the CARES Act only included a provision to reimburse for “applicable contract billing rates.” As most construction contracts are generally fixed, AGC sought clarification from DOD on this provision and has confirmed that the Class Deviation will apply to all defense contracts, including fixed price contracts. AGC will continue to work with DOD as they issue further guidance on this matter.

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