Your case matters to you.
It matters to us, too.

What are public contracting requirements under state or federal law?

On Behalf of | May 18, 2023 | Business Law

Public contracts can be very valuable for a business or contractor. After all, the government is a reliable client that will almost certainly follow through on its promises to pay for services rendered or goods provided. Sometimes, a successful contract can develop into an ongoing business relationship, which could prove to be very profitable for a company.

However, not every business that is seeking to provide goods and materials will be eligible to contract with the federal government or the state of Minnesota. There are numerous requirements that a company or contractor must conform to if they hope to secure government contracts.

Securing payment or performance bonds

Bonds are agreements or contracts that can hold one party responsible for certain parts of an arrangement. In the context of a government contract, payment and performance bonds serve as a way to pass liability to the business or contractor so that the government is not directly responsible for their failure to make payments or to perform the project as agreed.

Paying prevailing wages promptly

When workers and material providers don’t receive prompt payments from construction companies, they may pursue legal action in some cases. The possibility of unpaid parties obtaining a lean is one reason why prompt payment is necessary for those fulfilling government contracts. Offering prevailing wages to their employees or contractors is also typically a requirement.

Participating in a bidding process

The risk of corruption in any government dealings has certainly influenced the policy on government contracts. Those with authority to act on behalf of government agencies and organizations cannot commit to contracts or purchase agreements without a bidding process first. The bidding process helps ensure appropriate quality and cost control while reducing the possibility of corruption.

E-verifying workers

Typically, those accepting federal or state government contracts will need to affirm that they will not hire any undocumented employees and will typically need to e-verify all of their workers as one of the terms of doing government contract work. E-verifying whether or not an organization meets the requirements for government contracts could help a business owner or executive determine if they are in a position to start pursuing government work.

Seeking legal guidance to learn more about the expectations for those who contract with the government may help organizations and contractors that are considering making a bid for an upcoming project.