ORRCC Final RFP Section H - Amendment 0001.pdf

OAK RIDGE RESERVATION CLEANUP CONTRACT – FINAL RFP SECTION H

SOLICITATION NO. 89303319REM000047, AMENDMENT 1

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Part I – The Schedule

Section H

Special Contract Requirements

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Contents

H.1 DOE-H-2013 Consecutive Numbering (Oct 2014) ..................................................................... H-1

Contractor Human Resource Management (CHRM) Clauses ........................................................... H-1

H.2 DOE-H-2002 No Third Party Beneficiaries (Oct 2014) ............................................................. H-1

H.3 Definitions ...................................................................................................................................... H-1

H.4 Workforce Transition and Employee Hiring Preferences Including through Period of

Performance .................................................................................................................................. H-2

H.5 DOE-H-2001 Employee Compensation: Pay and Benefits (Oct 2017) (Revised) .................... H-3

H.6 Special Provisions Applicable To Workforce Transition and Employee Compensation: Pay and Benefits ................................................................................................................................. H-14

H.7 Workforce Transition and Benefits Transition: Plans and Timeframes .............................. H-15

H.8 DOE-H-2004 Post Contract Responsibilities for Pension and Other Benefit Plans

(Oct 2014) ..................................................................................................................................... H-19

H.9 DOE-H-2028 Labor Relations (Oct 2014) (Revised) ................................................................ H-20

H.10 Workforce Restructuring ........................................................................................................... H-21

H.11 Labor Standards.......................................................................................................................... H-23

H.12 DOE-H-2003 Workers’ Compensation Insurance (Oct 2014) ................................................ H-24

H.13 DOE-H-2073 Risk Management and Insurance Programs (Dec 2014) (Revised) ................. H-24

Business System Clauses ....................................................................................................................... H-27

H.14 DOE-H-2022 Contractor Business Systems (Oct 2014) (Revised) .......................................... H-27

H.15 DOE-H-2023 Cost Estimating System Requirements (Oct 2014) (Revised) .......................... H-28

H.16 DOE-H-2024 Earned Value Management System (Mar 2019) (Revised) .............................. H-31

H.17 DOE-H-2025 Accounting System Administration (Oct 2014) (Revised) ................................ H-35

H.18 DOE-H-2026 Contractor Purchasing System Administration (Oct 2014) (Revised) ............ H-37

H.19 DOE-H-2027 Contractor Property Management System Administration (Oct 2014)

(Revised) ....................................................................................................................................... H-40

Integrated Accounting System Clauses ............................................................................................... H-42

H.20 DOE-H-2015 Separate Corporate Entity (Oct 2014) ............................................................... H-42

H.21 Financial Management and Integrated Accounting System ................................................... H-42

H.22 Internal Audit .............................................................................................................................. H-42

H.23 DOE-H-2014 Contractor Acceptance of Notices of Violation or Alleged Violations, Fines, and

Penalties (Oct 2014) (Revised) ................................................................................................... H-42

H.24 DOE-H-2016 Performance Guarantee Agreement (Oct 2014) ............................................... H-43

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H.25 DOE-H-2017 Responsible Corporate Official and Corporate Board of Directors (Oct 2014)

(Revised) ....................................................................................................................................... H-43

H.26 DOE-H-2018 Privacy Act Systems of Records (Oct 2014) (Revised)...................................... H-45

H.27 DOE-H-2019 Disposition of Intellectual Property – Failure to Complete Contract

Performance (Jul 2018) .............................................................................................................. H-46

H.28 DOE-H-2021 Work Stoppage and Shutdown Authorization (Oct 2014) (Revised) .............. H-47

H.29 DOE-H-2033 Alternative Dispute Resolution (Oct 2014) ........................................................ H-47

H.30 DOE-H-2035 Organizational Conflict of Interest Management Plan (Oct 2014)

(Revised) ....................................................................................................................................... H-48

H.31 DOE-H-2043 Assignment and Transfer of Prime Contracts and Subcontracts (Oct 2014)

(Revised) ....................................................................................................................................... H-49

H.32 DOE-H-2045 Contractor Community Commitment (Oct 2014) (Revised) ............................ H-50

H.33 DOE-H-2046 Diversity Program (Oct 2014) ............................................................................. H-51

H.34 DOE-H-2048 Public Affairs – Contractor Releases of Information (Oct 2014) .................... H-51

H.35 DOE-H-2052 Representations, Certifications, and Other Statements of the Offeror (Oct 2014)

(Revised) ....................................................................................................................................... H-52

H.36 DOE-H-2053 Worker Safety and Health Program in Accordance with 10 CFR 851

(Oct 2014) ..................................................................................................................................... H-52

H.37 DOE-H-2058 Designation and Consent of Teaming Subcontracts – Alternate I (Oct 2014)

(Revised) ....................................................................................................................................... H-53

H.38 DOE-H-2059 Preservation of Antiquities, Wildlife, and Land Areas (Oct 2014) ................. H-53

H.39 DOE-H-2061 Change Order Accounting (Oct 2014) ............................................................... H-53

H.40 DOE-H-2063 Confidentiality of Information (Oct 2014) (Revised) ........................................ H-54

H.41 DOE-H-2064 Use of Information Technology Equipment, Software, and Third Party Services

- Alternate I (Oct 2014) ............................................................................................................... H-55

H.42 DOE-H-2068 Conference Management (Oct 2014) .................................................................. H-55

H.43 DOE-H-2069 Payments for Domestic Extended Personnel Assignments (Oct 2014)

(Revised) ....................................................................................................................................... H-57

H.44 DOE-H-2070 Key Personnel – Alternate I (Oct 2014) (Revised) ............................................ H-58

H.45 DOE-H-2071 Department of Energy Directives (Oct 2014) .................................................... H-60

H.46 DOE-H-2072 Use of Government Vehicles by Contractor Employees (Oct 2014) ................ H-60

H.47 DOE-H-2075 Prohibition on Funding For Certain Nondisclosure Agreements

(Oct 2014) ..................................................................................................................................... H-61

H.48 DOE-H-2076 Lobbying Restrictions (Nov 2018) ...................................................................... H-62

H.49 DOE-H-2080 Agreement Regarding Workplace Substance Abuse Programs at DOE Sites

(Apr 2018) .................................................................................................................................... H-62

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H.50 DOE-H-7003 Contractor Assurance System (Sep 2017) (Revised) ......................................... H-62

H.51 Task Ordering Procedure ........................................................................................................... H-63

H.52 Subcontracted Work ................................................................................................................... H-66

H.53 Parent Organization Support ..................................................................................................... H-67

H.54 Subcontractor Timekeeping Records Signature Requirement (Applies to Cost-

Reimbursement Task Orders only) ........................................................................................... H-67

H.55 Energy Employees Occupational Illness Compensation Program Act .................................. H-68

H.56 Environmental Compliance ........................................................................................................ H-68

H.57 Partnering .................................................................................................................................... H-70

H.58 Laws, Regulations, and DOE Directives ................................................................................... H-71

H.59 National Nuclear Security Administration/Environmental Management Strategic Sourcing

Partnership .................................................................................................................................. H-71

H.60 Mentor-Protégé Program ........................................................................................................... H-71

H.61 Legal Management ...................................................................................................................... H-72

H.62 Emergency Response .................................................................................................................. H-72

H.63 Interface and Cooperation with Other Site Contractors/Entities ........................................... H-72

H.64 Department of Energy National Training Center .................................................................... H-73

H.65 Annual Payroll and Residency Report ...................................................................................... H-73

H.66 Management of Accountable Property ..................................................................................... H-73

H.67 Real Property Asset Management ............................................................................................. H-74

H.68 Organizational Conflict of Interest – Affiliate(s)...................................................................... H-74

H.69 Information Technology and Cyber Security Requirements .................................................. H-75

Tables

Table H-1. Systems of Records............................................................................................................... H-45

Table H-2. Key Personnel ....................................................................................................................... H-58

Table H-3. Small Business Goals ........................................................................................................... H-65

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H.1 DOE-H-2013 Consecutive Numbering (Oct 2014)

Due to automated procedures employed in formulating this document, clauses and provisions contained within may not always be consecutively numbered.

Contractor Human Resource Management (CHRM) Clauses

H.2 DOE-H-2002 No Third Party Beneficiaries (Oct 2014)

This Contract is for the exclusive benefit and convenience of the parties hereto. Nothing contained herein shall be construed as granting, vesting, creating, or conferring any right of action or any other right or benefit upon past, present, or future employees of the Contractor, or upon any other third party. This provision is not intended to limit or impair the rights which any person may have under applicable

Federal statutes.

H.3 Definitions

For purposes of H Clauses entitled Workforce Transition and Employee Hiring Preferences Including through Period of Performance; DOE-H-2001, Employee Compensation: Pay and Benefits; and Special

Provisions Applicable to Workforce Transition and Employee Compensation: Pay and Benefits; the following definitions are applicable (unless otherwise specified):

(a) “Contract Award Date” means the date the contract is signed by the Contracting Officer (CO), noted in Block 28 of the SF 33, Solicitation, Offer and Award.

(b) “Contract Transition Period” means the transition period as defined in Section F of Task Order 1 -

Transition.

(c) “Grandfathered Employees” means those employees who are defined as Grandfathered Employees under the East Tennessee Technology Park (ETTP) multi-employer pension plan (MEPP) for

Grandfathered Employees and other existing benefit plans sponsored by the Incumbent Contractor, and applicable law.

(d) “Non-Grandfathered Employees” means employees who are not defined as Grandfathered Employees under the East Tennessee Technology Park (ETTP) multi-employer pension plan (MEPP) for

Grandfathered Employees and other existing benefit plans sponsored by the Incumbent Contractor, and applicable law.

(e) “Incumbent Contractor” means URS/CH2M Oak Ridge, LLC (UCOR) performing work under

Contract DE-SC0004645.

(f) “Incumbent Employees” means employees who are regular employees of UCOR as of the Contract

Award Date.

(g) “Non-Incumbent Employees” are employees other than Incumbent Employees.

(h) “Oak Ridge Reservation” includes the three sites on the reservation (East Tennessee Technology

Park, Oak Ridge National Laboratory and the Y-12 National Security Complex) that are operated by

U.S. Department of Energy (DOE).

(i) “Portsmouth and Paducah Contractors” means those DOE contractors and their first- and second-tier subcontractors at the Portsmouth and Paducah Gaseous Diffusion Plants with Grandfathered

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Employees who participate in the ETTP MEPP for Grandfathered Employees, Multiple Employer

Welfare Association (MEWA), ETTP Severance Plan for Grandfathered Employees, Long Term

Disability Program and the Retiree Healthcare Exchange.

(j) “Initial Notice to Proceed” means the authorization issued by the CO to start incoming transition performance of this Contract.

H.4 Workforce Transition and Employee Hiring Preferences Including through Period of Performance

The Contractor and its subcontractors shall maintain and develop trained and qualified personnel to perform the work scope included in Section C, consistent with applicable law, and the terms of this Contract, including the paragraphs set forth below. Means of maintaining and developing a trained and qualified workforce may include, but are not limited to, the utilization of apprentices, interns, veterans, and summer hires.

The Contractor shall comply with the hiring preferences set forth below:

(a) The Contractor shall provide Incumbent Employees, during the transition period, preferences in hiring for vacancies at the Oak Ridge Reservation for non-managerial positions (i.e., all those below the first line of supervision) in non-construction activities of the Performance

Work Statement under this Contract, in accordance with the hiring preferences in paragraphs

(1)–(2) below, in descending order of priority, any applicable collective-bargaining agreement(s), any applicable site seniority list(s) as provided to the Contractor by the CO, and in accordance with applicable law.

(1) A preference in hiring for vacancies in non-managerial positions that are substantially equivalent to the position each respective Incumbent Employee held on the Notice to

Proceed date.

(2) A preference in hiring for vacancies in non-managerial positions for Incumbent

Employees not hired into a substantially equivalent position in (i), but who meet the qualifications for another position.

(b) The Contractor shall provide, throughout the period of performance, preferences in hiring for vacancies at the Oak Ridge Reservation for non-managerial positions (i.e., all those below the first line of supervision), in accordance with the hiring preferences in paragraphs (1)–(4) below, in descending order of priority.

(1) Consistent with any applicable collective bargaining agreement(s) and site seniority lists at Oak Ridge Reservation, the Contractor shall give a preference in hiring to individuals who are former employees of the Incumbent Contractor, and who are entitled to recall rights.

(2) The Contractor shall give a preference in hiring to individuals set forth below in paragraphs (a) and (b), in descending order of priority, who are eligible for the hiring preference contained in the Section I clause of this Contract entitled “DEAR 952.226-74, Displaced Employee Hiring Preference,” consistent with the provisions of any applicable

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Workforce Restructuring Plan and Departmental guidance on workforce restructuring, as amended from time to time, regarding the preferential hiring of employees:

(i) Former employees of the Incumbent Contractor or any other DOE contractor [or subcontractor of a DOE contractor] at Oak Ridge Reservation.

(ii) Former employees of other DOE contractor(s) or subcontractor(s) at a DOE defense nuclear facility eligible for the hiring preference.

(3) The Contractor shall give a preference in hiring to individuals who (a) were formerly employed by Incumbent Contractor at Oak Ridge Reservation; and (b) were involuntarily separated (other than for cause) from their employment at Oak Ridge Reservation who are not precluded from seeking employment at the Oak Ridge Reservation by the terms of employee waivers or releases of claims they executed, absent repayment of severance consistent with the terms of those agreements and who are qualified for a particular position; and (c) are qualified for the position or who are not qualified for a particular position, but who agree to become qualified on their own and can become qualified by the date set by the Contractor for commencement of active employment under this

Contract.

(4) The Contractor shall give a preference in hiring to individuals (a) who have separated from employment at the Oak Ridge Reservation for any reason other than for cause; (b) who are not precluded from seeking employment with a DOE or National Nuclear Security

Administration (NNSA) contractor by the terms of employee waivers or releases of claims they executed, absent repayment of severance consistent with the terms of those agreements; and (c) who are qualified for a particular position.

H.5 DOE-H-2001 Employee Compensation: Pay and Benefits (Oct 2017)

(Revised)

(a) Contractor Employee Compensation Plan

The Contractor shall submit, for CO approval, by close of contract transition, a Contractor Employee

Compensation Plan demonstrating how the Contractor will comply with the compensation requirements of this Contract. The Contractor Employee Compensation Plan shall describe the

Contractor’s policies regarding compensation, pensions and other benefits, and how these policies will support at reasonable cost the effective recruitment and retention of a highly skilled, motivated, and experienced workforce.

A description of the Contractor Employee Compensation Program should include the following components;

(1) Philosophy and strategy for all pay delivery programs.

(2) System for establishing a job worth hierarchy.

(3) Method for relating internal job worth hierarchy to external market.

(4) System that links individual and/or group performance to compensation decisions.

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(5) Method for planning and monitoring the expenditure of funds.

(6) Method for ensuring compliance with applicable laws and regulations.

(7) System for communicating the programs to employees.

(8) System for internal controls and self-assessment; and

(9) System to ensure that reimbursement of compensation, including stipends, for employees who are on joint appointments with a parent or other organization shall be on a pro-rated basis.

(b) Total Compensation System

The Contractor shall develop, implement and maintain formal policies, practices and procedures to be used in the administration of its compensation system consistent with Federal Acquisition Regulation

(FAR) 31.205-6 and Department of Energy Acquisition Regulation (DEAR) 970.3102-05-6;

“Compensation for Personal Services.” DOE-approved standards (e.g., set forth in an advance understanding or appendix), if any, shall be applied to the Total Compensation System. The

Contractor’s Total Compensation System shall be fully documented, consistently applied, and acceptable to the CO. Costs incurred in implementing the Total Compensation System shall be consistent with the Contractor's documented Contractor Employee Compensation Plan as approved by the CO.

(c) Requirements for Subcontractors with Grandfathered Employees

DOE and the Contractor shall agree that its subcontractors with Grandfathered Employees will be subject to the requirements to provide pension and other benefits for Grandfathered Employees, as defined in paragraph (c) of H Clause entitled, Definitions.

(1) The Contractor shall submit to DOE no later than thirty days prior to the close of the Transition

Period, as defined in the Section F clause entitled, Period of Performance, and with each task order proposal submittal a list of subcontractors that will flow down the requirement for continuation of benefits to Grandfathered Employees.

(2) The Contractor may thereafter propose changes to those subcontractors subject to paragraph (1) above. Such proposed changes shall not be effective or implemented without prior written approval by the CO. Approval of a proposed change is at the unilateral discretion of the CO.

(3) The Contractor shall flow down, to all its subcontractors that participate in the ETTP MEPP in paragraph (1) and (2) of this section, the requirements of paragraphs (g) and (h) of this clause;

and paragraphs (a) and (b) of H Clause entitled, DOE-H-2004 Post Contract Responsibilities for

Pension and Other Benefit Plans.

(4) Subject to other subcontract review and approval requirements in this Contract, this Clause does not limit the Contractor’s ability to utilize subcontractors as necessary to perform Contract requirements.

(d) Reports and Information

The Contractor shall provide the CO with the following reports and information with respect to pay and benefits provided under this Contract:

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(1) An Annual Contractor Salary-Wage Increase Expenditure Report to include, at a minimum, breakouts for merit, promotion, variable pay, special adjustments, and structure movements for each pay structure showing actual against approved amounts and planned distribution of funds for the following year.

(2) A list of the top five most highly compensated executives as defined in FAR 31.205-6(p)(3) and their total cash compensation at the time of contract award and at the time of any subsequent change to their total cash compensation.

(3) An Annual Report of Compensation and Benefits. Report to be submitted no later than March 1 of each year in iBenefits or its successor.

(e) Employee Compensation Programs

The Contractor shall establish compensation programs for Incumbent Employees, and Non-

Incumbent Employees as set forth in paragraphs (1) and (2) below and consistent with any applicable collective bargaining agreement(s), and applicable law, provided, however, that employees scheduled to work fewer than 20 hours per week receive only those benefits required by law. Employees are eligible for benefits, subject to the terms, conditions, and limitations of each benefit program.

(1) Incumbent Employees are as defined in (f) of H Clause entitled Definitions.

(i) Pay. The Contractor shall provide equivalent base pay, as compared to base pay provided and reimbursed by the government to Incumbent Employees for at least the first year of the term of the Contract.

(2) Non-Incumbent Employees are as defined in (g) of H Clause entitled, Definitions. All Non-

Incumbent Employees shall receive a total pay and benefits package that provides for market-based retirement and medical benefit plans that are competitive with the industry from which the

Contractor recruits its employees and in accordance with Contract requirements.

(3) Cash Compensation

(i) The Contractor shall submit the following to the CO for a determination of cost allowability for reimbursement under the Contract:

(A) Any proposed major compensation program design changes prior to implementation.

(B) Variable pay programs/incentives. If not already authorized in the contract, a justification shall be provided with proposed costs and impacts to budget, if any.

(C) In the absence of Departmental policy to the contrary (e.g., Secretarial pay freeze) a

Contractor that meets the criteria, as set forth below, is not required to submit a

Compensation Increase Plan (CIP) request to the CO for an advance determination of cost allowability for a Merit Increase fund or Promotion/Adjustment fund:

1. The Merit Increase fund does not exceed the mean percent increase included in the annual Departmental guidance providing the WorldatWork Salary Budget Survey’s salary increase projected for the CIP year. The Promotion/Adjustment fund does not exceed 1.0 percent in total.

2. The budget used for both Merit Increase funds and Promotion/Adjustment funds shall be based on the payroll for the end of the previous CIP year.

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3. Salary structure adjustments do not exceed the mean WorldatWork structure adjustments projected for the CIP year and communicated through the annual

Department CIP guidance.

Please note: No later than the first day of the CIP cycle, Contractors must provide notification to the CO of planned increases and position to market data by mutually agreed-upon employment categories. No presumption of allowability will exist for employee job classes that exceed market position.

(D) If a Contractor does not meet the criteria included in (C) above, a CIP must be submitted to the CO for an advance determination of cost allowability. The CIP should include the following components and data:

1. Comparison of average pay to market average pay.

2. Information regarding surveys used for comparison.

3. Aging factors used for escalating survey data and supporting information.

4. Projection of escalation in the market and supporting information.

5. Information to support proposed structure adjustments, if any.

6. Analysis to support special adjustments.

7. Funding requests for each pay structure to include breakouts of merit, promotions, variable pay, special adjustments, and structure movement. (a) The proposed plan totals shall be expressed as a percentage of the payroll for the end of the previous

CIP year. (b) All pay actions granted under the CIP are fully charged when they occur regardless of time of year in which the action transpires and whether the employee terminates before year end. (c) Specific payroll groups (e.g., exempt, nonexempt) for which CIP amounts are intended shall be defined by mutual agreement between the Contractor and the CO. (d) The CO may adjust the CIP amount after approval based on major changes in factors that significantly affect the plan amount (for example, in the event of a major reduction in force or significant ramp-up).

8. A discussion of the impact of budget and business constraints on the CIP amount.

9. Comparison of pay to relevant factors other than market average pay.

(E) After receiving DOE CIP approval or if criteria in (e)(3)(i)(C) are met, contractors may make minor shifts of up to 10 percent of approved CIP funds by employment category

(e.g., Scientist/Engineer, Admin, Exempt, Non-Exempt) without obtaining DOE approval.

(F) Individual compensation actions for the top contractor official (e.g., laboratory director/plant manager or equivalent) and Key Personnel not included in the CIP. For those Key Personnel included in the CIP, DOE will approve salaries upon the initial

Contract award and when key personnel are replaced during the life of the Contract.

DOE will have access to all individual salary reimbursements. This access is provided for transparency; DOE will not approve individual salary actions (except as previously stated).

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(ii) The CO’s approval of individual compensation actions will be required only for the top contractor official (e.g., laboratory director/plant manager or equivalent) and Key Personnel as stated in (e)(3)(i)(F) above. The base salary reimbursement level for the top contractor official establishes the maximum allowable base salary reimbursement under the Contract.

Unusual circumstances may require a deviation for an individual on a case-by-case basis.

Any such deviations must be approved by the CO.

(iii) Except as set forth in a workforce restructuring plan approved by DOE, Severance Pay is not payable to an employee under this Contract if the employee:

(A) Voluntarily separates, resigns, or retires from employment,

(B) Is offered employment with a successor/replacement contractor,

(C) Is offered employment with a parent or affiliated company, or

(D) Is discharged for cause.

(iv) Service Credit for purposes of determining severance pay does not include any period of prior service for which severance pay has been previously paid through a DOE cost-reimbursement contract or Task Order.

(f) Employees Benefits

(1) Grandfathered Employees shall remain in their existing pension plan (or comparable successor plans if continuation of the existing plans is not practicable), pursuant to pension plan eligibility requirements and applicable law.

(2) Non-Grandfathered Employees shall receive a benefits package that provides for market-based retirement and medical benefit plans that are competitive with the industry from which the

Contractor recruits its employees and in accordance with Contract requirements.

(g) Pension and Other Benefit Programs

(1) No presumption of allowability will exist when the Contractor implements a new benefit plan or makes changes to existing benefit plans that increase costs or are contrary to Departmental policy or written instruction or until the CO makes a determination of cost allowability for reimbursement for new or changed benefit plans. Changes shall be in accordance with and pursuant to the terms and conditions of the contract. Advance notification, rather than approval, is required for changes that do not increase costs and are not contrary to Departmental policy or written instruction. To the extent that the Contractor has not submitted a new benefit plan or changes to existing benefit plans for approval on the basis that it does not increase costs and such new plan or change to existing plan does in fact increase costs, any increase in costs may be considered unreasonable and will likely be determined unallowable.

(2) Cost reimbursement for Employee pension and other benefit programs sponsored by the

Contractor will be based on the CO’s approval of Contractor actions pursuant to an approved

“Employee Benefits Value Study” and an “Employee Benefits Cost Survey Comparison” as described below.

(3) Unless otherwise stated, or as directed by the CO, the Contractor shall submit the studies required in paragraphs (i) and (ii) below. The studies shall be used by the Contractor in calculating the cost of benefits under existing benefit plans. An Employee Benefits Value Study Method using no less

H-8 than 15 comparator organizations and an Employee Benefits Cost Survey comparison method shall be used in this evaluation to establish an appropriate comparison method. In addition, the

Contractor shall submit updated studies to the CO for approval prior to the adoption of any change that increases the costs to a pension or other benefit plan.

(i) An Employee Benefits Value Study, for non-bargaining unit employees, every two years for each benefit tier (e.g., group of employees receiving a benefit package based on date of hire), which is an actuarial study of the relative value of the benefits programs offered by the Contractor to Employees measured against the relative value of benefit programs offered by the CO-approved comparator companies. To the extent that the value studies do not address post-retirement benefits other than pensions, the Contractor shall provide a separate cost and plan design data comparison for those benefits using external benchmarks derived from nationally recognized and CO-approved survey sources.

(ii) An Employee Benefits Cost Study Comparison annually for each benefit tier that analyzes the Contractor’s employee benefits cost for employees as a percent of payroll and compares it with the cost as a percent of payroll, including geographic factor adjustments, reported by the U.S. Department of Labor’s Bureau of Labor Statistics or other CO approved broad based national survey.

(4) When the net benefit value exceeds the comparator group by more than five percent, the

Contractor shall submit a corrective action plan to the CO for approval, unless waived in writing by the CO.

(5) When the benefit costs as a percent of payroll exceeds the comparator group by more than five percent, when and if required by the CO, the Contractor shall submit an analysis of the specific plan costs that result in or contribute to the percent of payroll exceeding the costs of the comparator group and submit a corrective action plan if directed by the CO.

(6) Within two years, or longer period as agreed to between the Contractor and the CO, of CO acceptance of the Contractor's corrective action plan, the Contractor shall align employee benefit programs with the benefit value and the cost as a percent of payroll in accordance with its corrective action plan.

(7) The Contractor may not terminate any benefit plan during the term of the Contract without the prior approval of the CO in writing.

(8) Cost reimbursement for post-retirement benefits other than pensions (PRBs) is contingent on

DOE approved service eligibility requirements for PRBs that shall be based on a minimum period of continuous employment service of not less than 5 years under a DOE cost reimbursement contract(s) immediately prior to retirement. Unless required by Federal or State law, advance funding of PRBs is not allowable.

(9) Each contractor sponsoring a defined benefit pension plan and/or postretirement benefit plan will participate in the annual plan management process which includes written responses to a questionnaire regarding plan management, providing forecasted estimates of future reimbursements in connection with the plan(s) and participating in a conference call to discuss the contractor submission (see (i)(6) below for Pension Management Plan requirements).

(10) Each contractor will respond to quarterly data calls issued through iBenefits, or its successor system.

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(h) Establishment and Maintenance of Pension Plans for which DOE Reimburses Costs

(1) Employees working for the Contractor shall only accrue credit for service under this Contract after the date of Contract Award.

(2) Except for Commingled Plans in existence as of the effective date of the contract, any pension plan maintained by the Contractor for which DOE reimburses costs shall be maintained as a separate pension plan distinct from any other pension plan that provides credit for service not performed under a DOE cost-reimbursement contract. When deemed appropriate by the CO, Commingled Plans shall be converted to Separate Plans after the date of Contract Award or the extension of a contract.

(i) Basic Requirements

The Contractor shall adhere to the requirements set forth below in the establishment and administration of pension and other benefit plans that are reimbursed by DOE pursuant to cost reimbursement contracts for management and operation of DOE facilities and pursuant to other cost reimbursement facilities contracts. Pension Plans include Defined Benefit and Defined Contribution plans.

(1) The Contractor shall become a sponsor of the existing pension and other benefit plans listed below, (Lead Sponsor for MEPP, MEWA and MEWA-PRB) (or, if continuation of the existing plans is not practicable, comparable successor plans) including PRBs, as applicable, with responsibility for management and administration of the plans. The Contractor shall be responsible for maintaining the qualified status of those plans, consistent with the requirements of the Employee Retirement Income Security Act of 1974 (ERISA), and the Internal Revenue Code

(IRC). The Contractor shall carry over the length of service credit and leave balances accrued under the plans as of the date of the Contractor’s assumption of Contract performance.

(i) East Tennessee Technology Park Pension Plan for Grandfathered Employees (MEPP)

(ii) East Tennessee Technology Park Health & Welfare Benefit Plan (MEWA)

(iii) URSǀCH2M Oak Ridge, LLC Health and Welfare Benefit Plan (single)

(iv) East Tennessee Technology Park Retirement Savings Plan (401k)

(v) East Tennessee Technology Park Retiree Medical Benefit Plan (MEWA-PRB)

(vi) East Tennessee Technology Park Severance Plan for Grandfathered Employees

(2) Each Contractor’s defined benefit and defined contribution pension plan shall be subjected to a limited-scope audit annually that satisfies the requirements of ERISA Section 103, except that every third year the Contractor must conduct a full-scope audit of defined benefit plan(s) satisfying ERISA Section 103. Alternatively, the Contractor may conduct a full-scope audit satisfying ERISA Section 103 annually. In all cases, the Contractor must submit the audit results to the CO. In years in which a limited scope audit is conducted, the Contractor must provide the

CO with a copy of the qualified trustee or custodian’s certification regarding the investment information that provides the basis for the plan sponsor to satisfy reporting requirements under

ERISA Section 104.

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While there is no requirement to submit a full scope audit for defined contribution plans, contractors are responsible for maintaining adequate controls for ensuring that defined contribution plan assets are correctly recorded and allocated to plan participants.

(3) For existing Commingled Plans, the Contractor shall maintain and provide annual Separate

Accounting of DOE liabilities and assets for a Separate Plan.

(4) For existing Commingled Plans, the Contractor shall be liable for any shortfall in the plan assets caused by funding or events unrelated to DOE contracts.

(5) The Contractor shall comply with the requirements of ERISA if applicable to the pension plan and any other applicable laws.

(6) The Pension Management Plan shall include a discussion of the Contractor’s plans for management and administration of all pension plans consistent with the terms of this Contract.

The Pension Management Plan shall be submitted in the iBenefits system, or its successor system no later than January 31 of each applicable year. A full description of the necessary reporting will be provided in the annual management plan data request. Within sixty (60) days after the date of the submission, appropriate Contractor representatives shall participate in a conference call to discuss the Contractor’s Pension Management Plan submission and any other current plan issues.

(j) Reimbursement of Contractors for Contributions to Defined Benefit Pension Plans

(1) Contractors that sponsor single employer or multiple employer defined benefit pension plans will be reimbursed for the annual required minimum contributions under the ERISA, as amended by the Pension Protection Act of 2006 and any other subsequent amendments. Reimbursement above the annual minimum required contribution will require prior approval of the CO. Minimum required contribution amounts will take into consideration all pre-funding balances and funding standard carryover balances. Early in the fiscal year but no later than the end of November, the

Contractor requesting above the minimum for the subsequent fiscal year, may submit/update a business case for funding above the minimum if preliminary approval is needed prior to the

Pension Management Plan process. The business case shall include a projection of the annual minimum required contribution and the proposed contribution above the minimum. The submission of the business case will provide the opportunity for the Department to provide preliminary approval, within 30 days after contractor submission, pending receipt of final estimates, generally after January 1st of the calendar year. Final approval of funding will be communicated by the Head of Contracting Activity when discount rates are finalized and it is known whether there are any budget issues with the proposed contribution amount.

(2) Contractors that sponsor multi-employer defined benefit pension plans will be reimbursed for pension contributions in the amounts necessary to ensure that the plans are funded to meet the annual minimum requirement under ERISA, as amended by the Pension Protection Act.

However, reimbursement for pension contributions above the annual minimum contribution required under ERISA, as amended by the Pension Protection Act, will require prior approval of the CO and will be considered on a case by case basis. Reimbursement amounts will take into consideration all pre-funding balances and funding standard carryover balances. Early in the fiscal year but no later than the end of November, the Contractor requesting above the minimum may submit/update a business case for funding above the minimum if preliminary approval is needed prior to the pension Management Plan process. The business case shall include a projection of the annual minimum required contribution and the proposed contribution above the

H-11 minimum. The submission of the business case will provide the opportunity for the Department to provide preliminary approval, within 30 days after contractor submission, pending receipt of final estimates, generally after January 1st of the calendar year. Final approval of funding will be communicated by the Head of Contracting Activity when discount rates are finalized and it is known whether there are any budget issues with the proposed contribution amount.

(k) Reporting Requirements for Designated Contracts

The following reports shall be submitted to DOE as soon as possible after the last day of the plan year by the contractor responsible for each designated pension plan funded by DOE but no later than the dates specified below:

(1) Actuarial Valuation Reports. The annual actuarial valuation report for each DOE-reimbursed pension plan and when a pension plan is commingled, the Contractor shall submit separate reports for DOE’s portion and the plan total by the due date for filing Internal Revenue Service

(IRS) Form 5500.

(2) Forms 5500. Copies of IRS Forms 5500 with Schedules for each DOE-funded pension plan, no later than that submitted to the IRS.

(3) Forms 5300. Copies of all forms in the 5300 series submitted to the IRS that document the establishment, amendment, termination, spin-off, or merger of a plan submitted to the IRS.

(l) Changes to Pension Plans

At least sixty (60) days prior to the adoption of any changes to a pension plan, the Contractor shall submit the information required below, to the CO. The CO must approve plan changes that increase costs as part of a determination as to whether the costs are deemed allowable pursuant to FAR

31.205-6, as supplemented by DEAR 970.3102-05-6.

(1) For proposed changes to pension plans and pension plan funding, the Contractor shall provide the following to the CO:

(i) a copy of the current plan document (as conformed to show all prior plan amendments), with the proposed new amendment indicated in redline/strikeout;

(ii) an analysis of the impact of any proposed changes on actuarial accrued liabilities and costs;

(iii) except in circumstances where the CO indicates that it is unnecessary, a legal explanation of the proposed changes from the counsel used by the plan for purposes of compliance with all legal requirements applicable to private sector defined benefit pension plans;

(iv) the Summary Plan Description; and,

(v) any such additional information as requested by the CO.

(2) Contractors shall submit new benefit plans and changes to plan design or funding methodology with justification to the CO for approval, as applicable (see (l)(1) above). The justification must:

(i) demonstrate the effect of the plan changes on the contract net benefit value or percent of payroll benefit costs,

(ii) provide the dollar estimate of savings or costs, and

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(iii) provide the basis of determining the estimated savings or cost.

(m) Terminating Operations

When operations at a designated DOE facility are terminated and no further work is to occur under the prime contract, the following apply:

(1) No further benefits for service shall accrue.

(2) The Contractor shall provide a determination statement in its settlement proposal, defining and identifying all liabilities and assets attributable to the DOE contract.

(3) The Contractor shall base its pension liabilities attributable to DOE contract work on the market value of annuities or lump sum payments or dispose of such liabilities through a competitive purchase of annuities or lump sum payouts.

(4) Assets shall be determined using the “accrual-basis market value” on the date of termination of operations.

(5) DOE and the Contractor(s) shall establish an effective date for spinoff or plan termination on the same day as the Contractor notifies the IRS of the spinoff; or

(6) Plan termination, all plan assets assigned to a spun-off or terminating plan shall be placed in a low-risk liability matching portfolio until the successor trustee, or an insurance company, is able to assume stewardship of those assets.

(n) Terminating Plans

(1) DOE Contractors shall not terminate any pension plan (Commingled or site specific) without requesting Departmental approval at least 60 days prior to the scheduled date of plan termination.

(2) To the extent possible, the Contractor shall satisfy plan liabilities to plan participants by the purchase of annuities through competitive bidding on the open annuity market or lump sum payouts. The Contractor shall apply the assumptions and procedures of the Pension Benefit

Guaranty Corporation.

(3) Funds to be paid or transferred to any party as a result of settlements relating to pension plan termination or reassignment shall accrue interest from the effective date of termination or reassignment until the date of payment or transfer.

(4) If ERISA or IRC rules prevent a full transfer of excess DOE reimbursed assets from the terminated plan, the Contractor shall pay any deficiency directly to DOE according to a schedule of payments to be negotiated by the parties.

(5) On or before the same day as the Contractor notifies the IRS of the spinoff or plan termination, all plan assets assigned to a spun-off or terminating plan shall be placed in a low-risk liability matching portfolio until the successor trustee, or an insurance company, is able to assume stewardship of those assets.

(6) DOE liability to a Commingled pension plan shall not exceed that portion which corresponds to

DOE contract service. The DOE shall have no other liability to the plan, to the plan sponsor, or to the plan participants.

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(7) After all liabilities of the plan are satisfied, the Contractor shall return to DOE an amount equaling the asset reversion from the plan termination and any earnings which accrue on that amount because of a delay in the payment to DOE. Such amount and such earnings shall be subject to DOE audit. To affect the purposes of this paragraph, DOE and the Contractor may stipulate to a schedule of payments.

(o) Special Programs

Contractors must advise DOE and receive prior approval for each early-out program, window benefit, disability program, plan-loan feature, employee contribution refund, asset reversion, or incidental benefit.

(p) Definitions

(1) Commingled Plans. Cover employees from the Contractor's private operations and its DOE contract work.

(2) Current Liability. The sum of all plan liabilities to employees and their beneficiaries. Current liability includes only benefits accrued to the date of valuation. This liability is commonly expressed as a present value.

(3) Defined Benefit Pension Plan. Provides a specific benefit at retirement that is determined pursuant to the formula in the pension plan document.

(4) Defined Contribution Pension Plan. Provides benefits to each participant based on the amount held in the participant’s account. Funds in the account may be comprised of employer contributions, employee contributions, investment returns on behalf of that plan participant and/or other amounts credited to the participant’s account.

(5) Designated Contract. For purposes of this clause, a contract (other than a prime cost reimbursement contract for management and operation of a DOE facility) for which the Head of the Departmental Contracting Activity determines that advance pension understandings are necessary or where there is a continuing Departmental obligation to the pension plan.

(6) Pension Fund. The portfolio of investments and cash provided by employer and employee contributions and investment returns. A pension fund exists to defray pension plan benefit outlays and (at the option of the plan sponsor) the administrative expenses of the plan.

(7) Separate Accounting. Account records established and maintained within a commingled plan for assets and liabilities attributable to DOE contract service. NOTE: The assets so represented are not for the exclusive benefit of any one group of plan participants.

(8) Separate Plan. Must satisfy IRC Sec. 414(l) definition of a single plan, designate assets for the exclusive benefit of employees under DOE contract, exist under a separate plan document

(having its own Department of Labor plan number) that is distinct from corporate plan…