Scene from 'Up In the Air'
Scene from ‘Up In the Air’

Scene from ‘Up In the Air’, a movie based around a traveling layoff agent.

This is a funny concept being tried (at least in some upstart companies).

As someone who gained redundancy status through no fault of my own, I’ve been either on the dole or working multiple jobs to try and make ends meet. I’ve also burned through part of my retirement, as so have a lot of other folk (condolences).

 So imagine my state of humor on reading that article. Somewhere between giddy and psychotic. There is no way that I’ll                                                                                 believe a) some shithead came up with this touchie-feelie activity, but that b) some CEO subscribed to it.

Assuming we’re all adults in the employment game, you pay attention to the gossip, the banal announcements from senior management, and that all important review score they give you once a year. Gossip is worth anything from zero to fifty points; management drivel, ten to twenty points; your personal rating, ten to fifty points. The point system will never exceed 100, and except for full dissolve meant of a company, shouldn’t go below ten. Dependent on the weighing of variables, most employees can read some of the writing on the wall. In my case, I knew the cuts were coming as soon as King O’s coronation. What blinded me to my prediction was that I had passed muster on the last three belt tightening and expected to weather this one out too.

But back to hosting a party for the newly unemployed. For the sake of maintaining morale. How does a brain even compute the rationale? A major traumatic even occurs and you receive a lukewarm send off. Stale afternoon coffee and a dried out cake. With your name spelled wrong.

In addition to this, I read a blog from the website http://www.ClearedConnections.com. While it might be easier to simply link to the offending blog, I choose to re-post it here, with my commentary in brackets/italics.

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Pay Cuts, Layoffs and Contract Recompetes

LayoffI’m going to oversimplify the world of government contracting for the sake of explaining why you might experience a pay cut or a layoff [It is one thing to suffer a paycut when you make a product. It’s quite another to have it cut so shareholders and managers hold onto their slice of the pie] after a contract recompete.

The government essentially has two options when it comes to soliciting work from contracting companies. They can base their selection criteria on a best value basis or a Lowest Price, Technically Acceptable (LPTA) basis. Best value, sometimes referred to as Performance/Price Trade-Off (PPT), needs little explanation. It means the government is willing to pay more to get a better solution or service. LPTA contracts on the other hand ultimately come down to price. The government will rank the proposals they receive in order of price. [BS]  Beginning with the lowest-priced solution proposed, the government will determine if it meets all of the technical requirements. If it does that company will receive the contract award. [If this were true, there would never be any contract protests].

The government will usually provide the previous contract award dollar amount and the number of personnel on the contract to potential bidders. This is important data because, unless the scope of the work significantly changes, companies will always try and bid lower than the last award amount on an LPTA solicitation. Aside from sharpening their pencil when it comes to profit, there are two main strategies bidders use to cut costs:

  1. Proposing fewer people (resulting in layoffs and an inreased workload for the remaining crew), and
  2. Proposing pay rates that are barely enough to hire minimally-qualified personnel. [Government / contractors are constrained by DOL labor rates. If the government low-balls, they get poor talent. If contractors low-ball, they might con some talent, but they might con desperate workers into fluffing their resumes].

Here’s where you come in.

When companies receive the solicitation from the government the list of qualifications needed for your position is usually very different from what you bring to the table. You are a systems engineer with 20+ years of experience, a Master’s degree and a handful of high-level certifications, but the solicitation calls for a systems administrator with 2+ years of experience, no degree and only one certification. Companies who are bidding on the work typically know nothing about your qualifications or your current pay rate. Even if they did, they wouldn’t be competitive if they priced your position to keep you at the same rate. Companies do market salary research using the minimum qualifications identified in the solicitation and propose rates accordingly. [Companies also demand a salary history. If you do not supply the information, your resume will never make it out of HR]. If they can divvy up your workload to others, they will cut your position. It’s not about you.

LPTA contracts have grown in number over the last decade due to increasing budget cuts. They aren’t popular with anyone except the people managing the budgets. The warfighter gets an inferior solution devoid of innovation. The customer gets personnel needing significant ramp-up time and additional training. The contracting company fights a constant battle between making enough money to keep the lights on and keeping their customer and employees happy. Employees change jobs more frequently to keep their pay rate in line with their qualifications.

If you’re looking for someone to blame, you’re going to have a hard time finding the right person. [Did anyone read the first line of the last paragraph?] Even the top brass are working to curb the use of LPTA. The Under Secretary of Defense, Frank Kendall, issued a memo in March of this year clarifying the appropriate use of LPTA. Summary: Good for buying toilet paper. Bad for buying technical services. Click here to read the LPTA memo.

How should you prepare for an upcoming recompete?  If you don’t already know how long your contract is for, ask your company’s Program Manager for the dates of the base period of performance and any option years. Your CAC expiration date should also give you an idea. When the end of the current period approaches, search a government site called FedBizOpps.gov (also fbo.gov) to see if there is a new solicitation. When you find it, look at the selection criteria and determine if it’s LPTA. Then find your own position in the performance work statement and see how you match up with the requirements. If you’re overqualified or if your specific responsibilities aren’t mentioned, you should update your resume and LinkedIn profile. [I’ve done this due diligence in search of jobs. While technically correct and useful, ther’s one rather large stumbling block: Getting past the HR weenie.]

As I stated at the beginning, I have oversimplified many aspects of the process. There are too many possible variations to account for in a blog post, but I hope this sheds some light on what goes on behind the scenes during a recompete and why it sometimes results in pay cuts and layoffs.

Bill BranstetterBill Branstetter is a corporate IT Recruiter, HR Director, Facility Security Officer and IT Manager for ASG in San Antonio, TX. He’s also the author of The Six Second Resume. Follow Bill on Twitter @billbranstetter.

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