What is the contractor's performance responsibility?
When the government awards a contract, the contractor assumes responsibility for timely delivery and satisfactory performance. Performance includes furnishing the government with the quantity and quality of items the contractor agreed to deliver and for which the government agreed to pay.
What tasks will the COR need to perform to successfully inspect contractor delivery or performance and to inform the CO when accepting or rejecting deliverables?
The COR will need to:
1. Inspect products or services
2. Recommend acceptance if products conform to requirements
3. Recommend rejection if products do not conform to requirements
4. Assist the CO in evaluating the contractor's reply to a notice of rejection.
Inspecting Products or Services
What are the three steps the COR should follow in performing his or her inspection and acceptance duties?
The COR should:
1. Identify the inspection method required by the contract
2. Determine if acceptance has occurred
3. Perform inspections.
1. Identifying the inspection method required by the contract
Before accepting the product or service, the government must be assured of the quality of the deliverable or performance of the work. Various inspection methods are used for ensuring quality and are incorporated in the various contract inspection clauses discussed below. The full text of the inspection clause may be included in the contract, or the number of the FAR inspection clause may be noted in the contract so that the clause can be referenced. The statement of work (SOW) may provide further clarification of inspection and acceptance requirements. A quality assurance plan (QAP) outlining the monitoring and inspection requirements may also be developed specifically for the contract.
FAR clauses detailing inspection methods include the following:
Clauses relating to government reliance on inspection by the contractor
(Refer to FAR clauses 52.246-1 and -4.)
The contractor is required to accomplish all inspection and testing needed to ensure that supplies or services conform to contract quality requirements before payment is made. The government may test the supplies or services in advance of acceptance when:
It has determined that the contractor's quality assurance processes are inadequate
Customary market practices for the specific commercial item being acquired specify this type of inspection.
Standard inspection requirements clause
(Refer to FAR clauses 52.246-2 and -3 through -10.) The standard inspection requirements clause:
Requires the contractor to provide and maintain an inspection system that is acceptable to the government
Gives the government the right to make inspections and perform tests while the contractor's work is in progress
Requires the contractor to keep, and make available to the government, complete records of its inspection work.
Higher-level contract quality requirements clause (Refer to FAR clause 52.246-11.)
This clause is applicable to contracts for complex or critical items or in situations in which the technical requirements of the contract require the government to:
Maintain control of work operations, in-process controls, and inspection
Concentrate its attention on organization, planning, work instructions, and document controls
Comply with a government-specified inspection system, quality control system, or quality program.
2. Determining if acceptance has occurred
Prior to performing inspections or testing, the government has to determine if it still has the right to reject nonconforming supplies or services.
The determination should resolve whether:
The work has been explicitly accepted by acceptance notice sent, acceptance made on a receiving report when the items were received by the government, or a letter indicating that acceptance has been provided to the contractor
There is evidence of implied acceptance because:
- The government has not voiced concerns about the procured supplies or services, and the time allowed for rejection has passed
- Payment has been made
- Delivered items or performed services have been retained or used.
It is critical to determine whether acceptance has occurred because acceptance is final, except in limited situations, and the government may not reject deliverables or services post-acceptance.
3. Performing inspections
General considerations when conducting inspections include:
Minimum inspection requirements
Inspection methods and occurrences
Unusual or incompetent inspections.
Minimum inspection requirements. At a minimum, the government is required to inspect contractor deliveries in order to determine whether:
The proper types or kinds of supplies were provided
The correct quantity of supplies was provided
Any changes or deviations from contract requirements exist
The product operates as intended
There are signs of spoilage or age deterioration
The item is properly identified or marked
Appropriate packaging was provided.
Inspection methods and occurrences. Appropriate types of inspection methods and occurrences may be covered in the contract clause or SOW.
Inspection methods can include:
Sensory and dimensional checks
Sensory checks are examinations by an inspector, who measures the procured supplies for the following defects using his or her senses of sight, hearing, and touch:
- Missing pieces
- Noisy operations
- Surface defects
- Parts that may be out of alignment.
Dimensional checks use gauges and micrometers to measure whether the dimensions of the procured items conform to contract specifications.
Performance or physical tests
These types of inspections allow the inspector to obtain actual performance data and indicate whether the procured product can perform as required by the contract. Requiring that a motor run or an operating system perform at a certain level for a specified period of time is an example of performance testing. Determining the hardness of an item's chemical composition is an example of a physical test.
Some contracts require that end products meet certain reliability standards or can withstand a set level of stress. Destructive tests simulate abuse until the item is destroyed. For instance, to test the fireproofing of a product, the product is heated until it burns.
The COR will (or will not) be required to run tests of procured items according to one of the following inspection occurrence guidelines:
No government inspection; the contractor is required to perform all inspections and testing
Evaluation of all procured items
Random or spot checking
Statistical sampling (testing a representative subset of procured items).
Interim inspections. The government has the right to inspect all materials and workmanship in a manner that will not unduly delay the work being done by the contractor. Interim government inspections, conducted while the contract work is in progress, may be used to determine
On-schedule performance can be expected
Cost will be within the initial estimate for cost-reimbursement types of contracts or fixed-price types of contracts with progress payments
Resources are being applied at originally predicted levels
The quality of end products will be consistent with the requirement
Progress payments are warranted
New components need to be incorporated in major systems
A contractor's own inspection system is adequate.
Improper inspections. The government has certain rights in the application of inspection procedures. Tests are considered to be improper when they:
Impose a stricter standard of performance than is otherwise prescribed
Do not reasonably measure whether the contract end items conform to the specified requirements
Are inconsistent with prior inspections
Result in unnecessary delays due to inspections that take place at unreasonable times and places.
Unusual or incompetent inspections. Any test used to overturn the results of another test is considered an unusual test. The CO must be involved when a case such as this arises.
Inspections made by incompetent inspectors may result in government negligence. If the negligence of a government agent causes financial damages to a contractor, it is likely that the government will be held liable for those damages.