Congratulations. You just won a federal contract. Your team is excited, and revenue projections look strong. But here’s what many small businesses don’t realize: winning the contract is only half the battle. The real work begins after award. Federal post-award compliance is complex, heavily regulated, and non-negotiable.
Failing to comply with post-award requirements can result in contract termination, loss of future opportunities, fines, and even debarment from federal contracting. Understanding what you’re required to do after award is critical to protecting your business and maintaining your government contracting reputation.
What Is Post-Award Compliance?
Post-award compliance refers to all the regulatory, contractual, and administrative requirements you must meet after your federal contract is awarded. These requirements are separate from performing the actual work. They include reporting obligations, compliance certifications, labor standards, security requirements, and ongoing regulatory adherence.
The federal government doesn’t just want you to deliver goods or services. It wants to ensure you’re doing so ethically, safely, and in compliance with hundreds of regulations.
Key Post-Award Compliance Requirements
Flowdown Clauses and Subcontractor Management
Your federal contract contains “flowdown clauses.” These are requirements that must be passed down to any subcontractors you hire. You’re responsible for ensuring subcontractors comply with all federal requirements. Failure to enforce these with subcontractors makes you liable for their violations.
Labor and Wage Compliance
Federal contracts often require compliance with prevailing wage laws, labor standards, and equal employment opportunity (EEO) regulations. You must pay workers at rates determined by the Department of Labor, maintain certified payroll records, and report labor violations immediately.
Cost Accounting Standards (CAS)
If your contract exceeds certain dollar thresholds, you must comply with Cost Accounting Standards. This means maintaining detailed, auditable records of how you allocate costs to the contract. Non-compliance can result in contract adjustments and penalties.
Security and Export Control
Depending on your contract type, you may need to maintain security clearances, handle classified information, or comply with export control regulations. These requirements are not optional; they’re legally mandated.
Timely Invoicing and Payment Reports
You must invoice according to contract terms and maintain accurate payment records. Invoicing errors, late submissions, or discrepancies can delay payment and trigger audits.
Performance Reporting
Many federal contracts require regular performance reports detailing progress, challenges, and accomplishments. Missing these deadlines or submitting incomplete reports can result in contract holds or termination.
Federal Funding Accountability and Transparency Act (FFATA) Compliance
If your contract exceeds $25,000, your company information must be registered in the System for Award Management (SAM) and reported through FFATA. This requirement continues throughout the contract period.
Compliance Audits and Inspections
The government retains the right to audit your books, inspect your work, and verify compliance at any time. Audits can be routine or triggered by concerns. You must maintain records and cooperate fully.
Common Post-Award Compliance Mistakes
Underestimating Administrative Burden: Small businesses often focus on delivering the product or service but underestimate the time and resources required for compliance. Budget accordingly.
Failing to Train Staff: Your team needs to understand compliance requirements. A single employee’s mistake can trigger government action.
Poor Record Keeping: Federal contracts require meticulous documentation. Incomplete records create audit risk and compliance gaps.
Ignoring Subcontractor Management: You’re responsible for subcontractor compliance. Establish processes to monitor and enforce compliance requirements.
Missing Deadlines: Late reports, invoices, or certifications can result in contract holds or termination for convenience.
Protecting Your Business
The best approach to post-award compliance is proactive management. Establish internal processes, assign compliance responsibility, train your team, and maintain detailed records from day one. Consider engaging a government compliance consultant to review your processes and identify gaps.
Post-award compliance isn’t glamorous, but it’s essential. Businesses that master compliance build long-term federal relationships and win repeat contracts. Those that ignore it face termination, debarment, and reputational damage.
Fed Services provides comprehensive post-award compliance support and contract management guidance to help your business maintain federal contracts and build sustainable government revenue. Contact us today!
