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Administrative Leave OK If Feds Gave It Too

Oct.19.2005

On October 11 DoD issued guidance (http://www.acq.osd.mil/dpap/policy/policyvault/2005-1405-DPAP.pdf) stating that the allowability of costs of paid administrative leave granted to contractor employees as a result of closures caused by Hurricane Katrina will be determined on a case-by-case basis, taking into consideration whether other businesses in the same geographical area were closed because of the hurricane and whether Federal employees in the same area received paid administrative leave. Although the guidance strongly encourages the negotiation of advance agreements regarding the allowability of other “unusual” costs incurred by contractors for the support of displaced employees, contracting officers are directed not to approve payments for Katrina-related costs pending the outcome of claims for such costs from insurance carriers.

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Terry L. Albertson
Senior Counsel – Washington, D.C.
Phone: +1 202.624.2635
Email: talbertson@crowell.com