Month: June 2016

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New Legislation Prohibiting Use of Experience Modification Factor For Contractor Eligibility

One of the new legislative changes that goes into effect in Virginia on July 1, 2016 is a prohibition against using any experience modification factor as a condition of any bidder’s or offeror’s eligibility to participate in a solicitation for construction. Interestingly, while the prohibition was added to the Virginia Public Procurement Act (VPPA), the language in the act expands application to both VPPA and non-VPPA offers to contract issued on or after July 1, 2016.

As defined in the adopted bill, “experience modification factor” is defined as “a value assigned to an employer as determined by a rate service organization in accordance with its uniform experience rating plan required to be filed pursuant to subsection D of [Virginia Code Section] 38.2-1913.”

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Virginia Supreme Court Confirms Employee Firings on the Spot

My law partner Anne Bibeau, who focuses her law practice on employment and labor law matters, provided this summary of the Virginia Supreme Court’s recent decision in the case of Johnson v. William E. Wood & Associates, Inc.:

In a recent opinion involving a fired realtor, the Virginia Supreme Court confirmed that at-will employees can be fired on the spot, without any prior notice to the employee. The decision was unanimous, and noted that while the firing notice “must be reasonable,” advance notice was not required because, among other things, that would be contrary to the flexibility at the heart of the at-will employment doctrine and undermine the indefinite duration which is implicitly an element of at-will employment.

In Virginia, unless the employer and employee agree otherwise, employment is “at will,” meaning that either the employer or employee may end the employment relationship at any time and for any (legal) reason, upon “reasonable notice.” The plaintiff in that case, Johnston v. William E. Wood & Associates, Inc., argued that “reasonable notice” meant advanced notice. The Virginia Supreme Court shot down that argument, holding that to be “reasonable,” notice of the termination need only be effective notice. In other words, the employer only has to make clear to the employee that the employment relationship has ended, so that the employee knows to stop work. Advance notice of the termination is not required unless the employer has promised to give advance notice or the federal WARN Act, which addresses mass layoffs and plant closings, applies.

The court’s decision was not a change in the law, but blocked a determined effort by plaintiffs’ attorneys to chip away at the at-will employment doctrine, which is already circumscribed by other laws limiting the reasons for employment termination. As before, employers need to be mindful that their employee policies, handbooks, offer letters, and other communications with their employees—both written and oral—do not promise or imply that the employment relationship will last for a particular period, or that the employee will only be fired for cause or after advanced notice. Employers should consult with an employment attorney about whether to require employees give advance notice of resignation. The best practice is to emphasize that the employment is at-will and can end at any time and for any reason.

Construction Forecast For 2017: What Project Types Are Predicted To Be Hot

LAW TIPS

Authored by Attorney George Nicholos

According to the American Institute of Architect’s (AIA) semi-annual Construction Consensus Forecast, construction spending in the non-residential market is predicted to increase by 8.3 percent in 2016 and by 6.7 percent in 2017.  Demand is expected to be especially high for project types that include hotels, office space, industrial facilities, and amusement and recreation spaces.  The forecast noted that while interest rates could pose a challenge to the U.S. economy, lower energy prices, improved employment figures and an enacted federal budget for 2016 are all consistent with a favorable outlook for the construction industry.

The AIA Construction Consensus Forecast is a highly respected barometer of the construction industry as it is conducted semi-annually with the leading nonresidential construction forecasters in the United States, including Dodge & Data analytics, Wells Fargo Securities, HIS-Global Insight, Moody’s Economy.com, CMD Group, Associated Builders and Contractors, and FMI to provide a consensus view of trends in the construction industry.

The AIA’s forecast also included a list of the most prevalent design trends expected over the next ten years.  The trends were obtained from contributing panelists to the AIA’s Architecture Billings Index (ABI) which is an index derived form the monthly survey of work-on-the-boards in architectural firms throughout the U.S. the index is conducted by the AIA Economics & Market Research Group.  Interestingly the most prevalent trends are predicted to be associated with energy efficiency and related technology to integrate water conservation, solar and wind power generation, natural day lighting techniques and technology, automated controls and motion sensor activated lighting, as well as the use of innovative new building materials such as composites and new glass/glazing technologies.

General Accountability Office Proposing Fee for E-Filing Protests

LAW TIPS

Dissatisfied bidders and offerors can currently file protests for free electronically, but the General Accountability Office (GAO) is now proposing a $350 fee. The reasons given for the change are to finance the program, including a new system, and seemingly to discourage what the GAO’s considers unnecessary filings that result from the current free and easy-to-use system.

2,639 protests were filed last year, and the GAO argues many of them unnecessary. Critics of the proposal note that the current system allows access regardless of financial circumstances, and that charging a fee will discourage protests. While the U.S. Court of Federal Claims charges a fee for protests, it has a program in place that considers ability to pay when collecting its filing fee; and it is unknown whether the GAO will do the same.

The GAO determined the proposed fee level, in part, by figuring the price of building and running a new filing system called the Electronic Protest Docket System (EPDS). Separate from the proposed filing fee there are additional concerns that EPDS will be publicly available, meaning every document filed in the system could be accessed by the general public. This would require contractors and attorneys to redact a greater amount of material, further increasing filing costs and affecting filing strategies. GAO has not yet addressed the EPDS confidentiality concerns.

Copy of the April 16, 2016 proposed rule is available at the following Federal Register website.

The new rule is not officially subject to a comment period, but the GAO is accepting comments to the proposed through May 16, 2016.

For any of the other Construction and Government Contracts Team members at Vandeventer Black.

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