5 Things GovCons Can't Miss as FY'25 Comes to a Close

Joe Young

Good afternoon and welcome, GovCon HR Professionals, to the 20th episode of the GovCon HR Round-Up. It is great to be with all of you again in a beautiful September. I'm not sure where everybody's calling in from, but, the last 30 days here probably been the nicest 30 days I can ever remember in September and August.

Declan Leonard

Absolutely beautiful. It's been so nice.

Joe Young

Yeah, I tell people now I know what it’s like the live in San Diego.

Declan Leonard

Yeah, yeah, yeah, you should get out and play golf one of these days.

Joe Young

Yeah. I mean, I may do that. For the fourth time today. No, no, not that often. But it has been great for playing golf. No sweating. It's been spectacular.

Declan Leonard

Yes.

Joe Young

But welcome, everybody. Great to have you with us today. For those of you who are first time listeners, welcome. And for, some of our audience who have joined us frequently, welcome back. My name is Joe Young. I am the President of GovConPay. For those of you who don't know, we are the only outsourced payroll and HR provider focused exclusively on serving the GovCon marketplace.

We are coming to you as we always are from the studios here in Tysons Corner, Virginia, of BLC Digital Strategies, the media affiliate of Berenzweig Leonard LLP, and under the support and direction of our producer, Mr. Todd Castleberry, who is mourning the loss of the Redskins quarterback for a couple weeks. Commanders. Excuse me. But he's going to get over it.

Declan Leonard

And is that official? I didn't see that yet.

Joe Young

Yeah. Todd said it's official.

Declan Leonard

Oh gosh.

Joe Young

I go on what Todd says.

Before we get started, I want to, as always, thank our sponsor, the folks from Berkshire Associates. For those of you who are not as familiar with Berkshire, they are our HR compliance experts with over 50 years of experience in providing compliance services, technology and nondiscrimination services, workforce analytics, and pay equity expertise.

Have we joked before that they've been very busy in 2025?

Declan Leonard

No doubt.

Joe Young

Special thank you again to them and special welcome to any Berkshire clients who are joining us today. For those of you who join us frequently, you will see we are a slimmed down cast today.

Declan Leonard

We have a little bit more elbow room, and usually Joe's, like, close to on my lap here.

Joe Young

We weren't even sure… We don't know where Seth is.

Declan Leonard

Yeah, yeah. You asked me? And I said, I have no idea.

Joe Young

Just not here! Hopefully Seth is well and he’ll be back with us next month.

But I am with our partner here, Declan Leonard, one of the managing principals here at Berenzweig Leonard. Will you give us a quick introduction to yourself and the firm, and then we'll dive into the show today.

Declan Leonard

Man, I can't believe it's already been 20 episodes. That's fantastic. Declan Leonard, managing partner here at Berenzweig Leonard law firm here in Tysons Corner. And I also head up our firm's employment law practice. And, yeah, we got a lot to talk about today. So let's jump in.

Joe Young

Lot to talk about. We’re never short of topics.

Declan Leonard

No, no no, no.

Joe Young

And before we jump into it, I do want to remind all of our listeners today, we are coming to you live. So, if you do have any questions on the things we're covering today, please put them into the chat. The team’s monitoring them, they will try and send those to us and we'll try and address those while we're together today, if we can.

So, what are we talking today? We've been trying to be timely. But it is the end of the fiscal year.

Declan Leonard

Yeah, it's hard to believe we've been talking about this all year.

Joe Young

So, we kind of said, “Hey, what are the what are the top things this time of year that our HR professionals need to be thinking about?” So, you and your great staff and team came up with kind of a top five topics that should be top of mind, things that have some focus.

Some of these things are kind of breaking and more timely. So, that's really what we're going to jump to and focus on today. What are some of those end of fiscal year, five most important things that GovCon leaders need to keep in mind as we as we head into fiscal year ’26? So, with that, let's start with the first topic, which has the quickest and most impending deadline.

And that's some of our would-have-been consistent reporting requirements. We've got vets reporting requirements coming up here at the end of the month. So, that's probably the most pressing thing here in the coming weeks.

Declan Leonard

Yeah. Actually, comes up at September 30th. So, just to recap a little bit, we've talked about this in past roundups. With the new administration, prior to the new administration, there were all types of reporting requirements, for government contractors. It frankly took up a lot of time and bandwidth for HR professionals out there. So, in some respects, that has been greatly, greatly pared down. In fact, the OFCCP, where all of these affirmative action plans, all of these reporting requirements were directed to, that's actually just being disbanded. So now you're just gonna have…

Joe Young

We’ve talked a lot about that this year.

Declan Leonard

Exactly. So, what you have left at the end of the day, and what we'll be talking about with this upcoming deadline is the reporting for veteran hires, and government contractors out there are well aware of this. So part of this is not necessarily a big tutorial on it. It's a form. It's a well-known form for most of the folks that are probably listening.

It's just really a reminder at the end of the day that this is coming up on September 30^th. It's less than two weeks away. It's really one of the few reportings that government contractors now have to do. And that gets filed with the Department of Labor. So this is more of our public service announcement to say, “Hey, you’ve got 12 days to get this one in.”

Joe Young

Friendly reminder from the Round-Up.

Declan Leonard

Yeah. Because a lot of people have asked us, like, “Do we have to report anything anymore?” And it's like, okay. Yeah, there's still a few things left. Disability. But this is the one that's most immediate on the horizon. So, with everything, with the flurry of stuff going on with HR, working with companies on bids and proposals, don't let that one fall through the cracks.

Joe Young

And, you know, you mentioned affirmative action reports. Affirmative action plans. It was around this time of year that type of reporting used to be due as well. No longer a requirement to do that reporting.

But, we've talked a lot this year. All the changes with administrations. We get down the road here in a couple of years, we have a new administration, that could be back on the table that you need to do that. Is there anything that our listeners need to be thinking about or planning for? That could be, “Hey, there's a new administration and they're like, ‘Hey, where's your data from 2025?’ You don't need to report that.” Are there any concerns with that? What would you recommend to our clients around potential changes and anything retro?

Declan Leonard

Yeah, it's kind of the Yo-Yo effect. And, of course, it hits government contractors more than any other private companies because they're the ones that get paid by the federal government. So, the federal government can come in and say, “We now want you to do this.” A year ago, they had to do affirmative action plans. They had to do all kinds of data collection, affirmative hiring obligations, and reporting requirements.

Now, a year later, they don't have to. But to your point, things change. And if a new administration comes in, they could very well just reverse everything. And so, it really would leave government contractors in a bit of a bind. I personally think that they don't have to collect the data.

They have a good excuse not to collect the data right now. And frankly, you could argue that if they do start collecting the data too vigilantly, they're now running afoul of the DEI requirements. And I did say I was not going to say DEI today. It was going to be a DEI free zone.

But the only thing I point out is, okay, the federal government does not want you engaging in DEI. Some states do want you to. And I'll remind people that if you get hit with a discrimination lawsuit, you're in a courtroom with a judge and a jury that is not the Trump administration. And they may say, “Well, tell us what you have done related to hiring practices and have you engaged in discrimination?” So it is a balancing act that I think HR is doing these days.

Joe Young

Not much black and white these days.

Declan Leonard

No. Definitely not.

Joe Young

As far as breaking news on another topic that we want to touch on today - and this is not a topic that traditionally, I think, the weight is falling on the HR departments and our HR professionals on the call. It's something that all of us have just had beat over our heads for the past few years, which is CMMC.

Just last week on the 10th, final regulations and rules were published. Final timelines. As far as the requirements. We know and just go into your inbox, we could have a three day session on CMMC requirements, certainly not something we'll dive into, but from the HR professionals and our listeners out there, one of the high things, high level down things, as far as a new timelines that things related to CMMC that all of us really need to be aware of, and the impact that could have on government contractors over the next few years.

Declan Leonard

Yeah. And I'm one of those people who, when I'm sitting in these meetings and people are throwing acronyms around, I always raise my hand and say, “I'm dumb and I don't know what that means.” CMMC we have been talking about this for years. Now, it's finally going into effect. This is the next one that comes into effect.

And this is in November. And it stands for Cybersecurity Maturity Model Certification - CMMC - and it’s basically just cyber standards, making sure that government contractors… we could we could do a Round-Up for weeks on this one topic. So, we're not going to get too deep into it, but it basically is…

Joe Young

Don't ask us detailed questions!

Declan Leonard

Yeah yeah yeah yeah. Please don't. There are attorneys and there are accountants and there are all other kinds of specialists that are dealing with this.

Joe Young

And just know it a lot better.

Declan Leonard

Yeah. It's an industry now. But, at a high level it's basically saying… It’s for the Department of Defense, which I don't know if it's officially the Department of War yet, I know it's being changed at some point…

Joe Young

No. These still say DoD.

Declan Leonard

We haven't updated these. So, for DoD, it's basically making sure that federal contractors, subcontractors, have the appropriate standards for protecting government information. I mean, that is at a very, very general level. And so, there are all these different phases that they have to go through. But we're starting the next deadline, November 10th is when things kick off, compliance kicks off.

It's going to be kind of a soft. It's like a restaurant. It's going to be a soft opening at first, a little bit of self-assessment. And then it gets into a lot more rigid requirements down the line. Nobody's going to be able to escape this. It's going to be critical.

And frankly, you want to get ahead of it because it is a probably a market differentiator for you, to make sure to be able to tell contracting officers we're fully compliant. We're fully CMMC certified. So that is where HR comes into play is you're going to have to work hand-in-hand with your cyber folks to implement training because your workforce has to know about this, has to be on board with this, because they're the ones that can, for lack of a better phrase, screw it up if they don't know how they're supposed to be handling this stuff in the appropriate way.

They should be in there helping. HR should have a huge seat at the table, developing policies, procedures related to the security, and cyber.

Joe Young

Yeah. And I think that's one of the big differences in the past couple of weeks. I think in the past years it was, “Hey, this was a differentiator, market differentiator.” Say, “Hey, we've got our CMMC level 2.” Well, now it's not a differentiator. Now, it's going to be a requirement, like you’re either going to have it or you don't.

And without these requirements… It is going to be in the contracts and the RFPs.

Declan Leonard

Oh, it's going to start. It's going to start.

Joe Young

And then it's going to be totally enforced. It's over this three-year plan. So, yeah, it's going to be very interesting. Kind of the rollout, the impact, and then how this has got to become such a big focus. And as I said, a year from now, you're going to have to have not just be self assessing, but have these certifications done to be able to respond, to continue to do work on contracts you even potentially have.

Declan Leonard

And I think the mistake that companies will make is to treat this compliance, this cyber security standards over here like, “oh, that's in this department.” I think that's going to be the biggest mistake. And I think it's going to be incumbent upon HR professionals to make sure that this permeates the entire workplace. All of the employees know about it.

Yeah. They're not caught off guard. They know what is expected of them because they're the boots on the ground implementing a lot of this stuff. And they're, frankly, the ones that can make the mistakes that could hurt a company.

Joe Young

Yeah, I mean, we had a question like, “If you're a little behind, what's the easiest first step?” I mean, I saw something recently that said the best time to get certified was last week. The next best time to get certified is now. Waiting for guidance and waiting to dive in, those days are over. It's time to take action now.

Declan Leonard

You’ve got to have some mercy here. I mean, it's been a very challenging time in the government contracting realm all year. We're now at the end of the government's fiscal year coming up in 12 days. And then another 40 days after that is when CMMC has to start. They have to start coming into compliance with that answer.

Joe Young

And yes, we are on the path to certification.

Declan Leonard

So, I think what they should do is take a deep breath and then start to take stock of what information they have that is implicated by these regulations. They call them FCI and CUI - federal contract information and controlled unclassified information. We're not getting into what those are, but what they should do is they should be working closely with their cyber folks, with their IT folks, to say what do we even have in this regard?

Maybe we don't even have as big a problem as we think we do. But if we do, determine what level of security applies because it's not a one size fits all regulation. There are different levels based on the type of information that you possess. Obviously, the more sensitive the information, the higher the security level that these contractors are going to have to adhere to. Conduct what they call internal gap assessments.

Where are we lacking? What do we need to do to make sure that we don't have these gaps? And then start to engage in training and create policies and procedures. So, I think they're fine. I think they're fine. I think, like I said, it's a soft opening. They're not going to be, come November 10^th, people are not going to get debarment notices and things of that nature.

But by the same token, don't put your head in the sand. Keep going.

Joe Young

And a lot of times these steps going forward are going to require third parties to come in and do these certifications. You're not going be able to self-assess anymore. So, that's all going to be a new process again.

Declan Leonard

So you're already out there. Your already thin margins as a government contractor are getting thinner.

Joe Young

More expensive, unfortunately, to do business. Something that I think we're all going to be continuing to hear about and be dealing with in the next few months and obviously years to come as this is rolled out over the next three years.

Let's switch topics. Speaking of eligibility, great segue into a next topic of what's going on at the SBA.

There's some interesting changes there. And a lot of our listeners, a lot of our clients are small businesses.

Declan Leonard

So this is really interesting. This is the proverbial talk of the town, you know, in the in the government contract space. Mergers and acquisitions, M&A. M&A activity has been pretty robust. Private equity has been getting into government contracts. They typically stayed away. They didn't always like the lower margins of government contractors. They saw during COVID, though, that government contractors were the ones that were really kind of doing the best. So here, this is an interesting thing. The Small Business Administration is what certifies small businesses. And most large contractors love to target purchasing smaller businesses. And up until January - I'll make sure I get this date right -up until January 17th of this coming 2026.

So we're a couple of months away from this deadline, very, very important deadline: January 17th, 2026. Up until that date, when a large contractor buys a smaller company - and let's say that smaller company has what's called a multiple award contract, an IDIQ with multiple awardees, in the way an idea like works is you get that contract, but it's really just kind of a seat at the table.

And then what the government does is they issue task orders under that for the life of the IDIQ. Up until that date of January 17th, a large contractor which would otherwise not be eligible to get that set aside IDIQ, they could buy the small company and they could continue for the life of that contract to continue to bid on and get awarded task orders, even though they're a large company. That is changing.

Okay. It’s going to be seismic. It's going to be seismic for the M&A activity in the government industry, because now as of January 17th, any deals that close after that date, you no longer can do that. A large company, if it buys a smaller company and they have a multiple award contract, the large contractor can no longer bid on task orders that come out after that.

So, it's going to change a lot of things because that was a huge incentive for large companies buying small companies.

Joe Young

And talk about impact with regards to joint ventures.

Declan Leonard

Yeah, it also applies to joint ventures. So, you don't get around it just because it's a joint venture. If either of the ventures under a joint venture are going through a same merger and acquisition type thing, you have to do the same analysis. And that would disqualify the joint venture from going after these task orders under the IDIQ.

If it's a couple of nuances, just to make sure this has to this applies to what they call MACs, multiple award contracts, which means an idea like that goes to a number of different companies. Here are six companies. You all have a seat at the table. We're going to throw a task order in the middle and you all battle for it.

And whoever gets it, if it's a single award IDIQ, it's no longer a MAC, they are not subject to that restriction come January 17^th. They are allowed to continue bidding. So if a large company buys a small company that has a single award IDIQ, they can they can continue to bid on task orders.

One more thing is, if a small business under the SBA buys or combines with another small business, and as a result of that combination, they become large enough that they're no longer small businesses, they actually are exempt from this too and can still bid on task orders.

Joe Young

Yeah. Yeah. But a lot of change, as you said. It definitely affects M&A when a lot of that activity was getting access to those contracts by the by the larges, and by the primes.

I’m going to make a little bit of an audible here. I'm going to skip a question and go to another question. Our last question here. And then we have another topic I think we're gonna add for our listeners today. But new law coming potentially here with some impact that I know we wanted to get to and that is the Employment Abundance Act. And what is it? And what do you government contractors need to know about it? It’s going into effect here in January, correct?

Declan Leonard

No. This one actually is just a bill right now.

Joe Young

Oh, yeah.

Declan Leonard

So it's just a bill on Capitol Hill? It is.

Joe Young

All of us of a certain age right now are now humming a song. Thank you.

Declan Leonard

Thank you for getting that reference.

Joe Young

Yes, absolutely.

Declan Leonard

And so, yeah, it's called the Employment Abundance Act, but right now, it's just been proposed as a bill, by I forget. Some Congressperson has done it, but it's such an interesting concept because basically what it says is, it's going to ask government contractors to look at all of their job postings, because a lot of times these job postings says college degrees required, you know, must have college degree.

Joe Young

Standard boilerplate language.

Declan Leonard

Totally, totally. And so, what they're basically saying, and it's implicit in the Employment Abundance Act title, it's basically saying, “Look, we need to spread out the the number of people that can apply for these jobs.” So, basically, if it passes, it will require government contractors and subcontractors to look at their positions, to look at their job postings, and to say “Is a college degree really necessary? Do you really have to have that in there?”

Because what you're doing is you're excluding a huge part of the relevant labor pool to do so. And as we know, I mean, look, some of these people that work in Silicon Valley, some of these people that are doing like some of the highest levels of AI and everything else.

Joe Young

They were dropouts. They were in their parents garage.

Declan Leonard

They totally are!

Joe Young

Training themselves on AI.

Declan Leonard

Yeah. What you're going to see is you're going to see a shift, if this - and I would argue, you know, to my clients, I'd say, you know what? You should forget about whether this even becomes a bill. Start looking at your job postings now. And instead of like, reflexively saying you’ve got to have a college degree, focus more on what are the relevant skills are and see whether or not.

Because if you have a college degree and the job is for high level IT, AI, let's just say your college degree’s in communications. There's not a huge relevance to that. So, I think they should really look at this and say a college degree in such and such, if it is truly relevant.

Joe Young

So recommendation to the listeners is, first of all, be aware of this. Keep an eye on it, but also maybe start making those adjustments now so you don't find yourself in a situation. This goes into effect. You're in a very busy hiring season and then you reflexively you have to go out and review every job description, every posting, you have there for compliance and it’s impacting your recruiting at that time.

Declan Leonard

Oh, totally. For HR folks out there recruiting, it's going to change your strategy and your tactics to the extent that you do job fairs on college campuses, exclusively. You may decide that that's not where you're going to be looking anymore, because you can find qualified people who maybe don't have that piece of paper.

Joe Young

Yeah. So, one of our other top five topics, I jumped over and we'll go back to as we a few more minutes here it was around I-9s. Yes. Recordkeeping with I-9s. So, what, in general did you want to share with the listeners today regarding I-9 recordkeeping and management?

Declan Leonard

I mean I-9s, there's nothing earth shattering that's going on other than the fact that this administration obviously, immigration and legal workforce is top of mind for this administration. And so, we have always said, I think we've said it on a couple of these past roundups, that we can expect I-9 audits to be on the upswing.

So, it's really just most folks that are watching today know that I-9s are just such a critical part, getting the appropriate documentation. A couple of things I would just raise, not going to spend much time on it, but remember, E-Verify is not the same and should not be a substitute for I-9.

They are complementary and they go towards the same goal of making sure that somebody is lawfully eligible to work in the United States. But they're not just a substitute. “Oh, I do E-Verify, so I don't have to do I-9.” No, if you do get an audit letter, you usually have three days to be able to comply and provide your record.

So this I-9 is not an area that you're going to be able to do what I did in college, which is basically play catch up at the very end right before a test. You have to be doing this stuff all along, and make sure you have those. And also always make sure you're using the most updated form for I-9 on the government's website. They recently changed it. You don't have to redo your I-9 when they change it for all past employees, but just make sure that that when you have a new employee, you're using the most recent I-9, particularly this administration’s. They've changed some stuff on the I-9 form based on their goals, and their priorities.

And so, you know, that's just another sort of word to the wise out there.

Joe Young

In our efforts to always remain timely and with breaking news out there and to bring insights to our audience, one topic I wanted to jump to that we talked just a little bit about before we came in here today, but I know you spoke about this online the other day. And I think it's really important. I'd love you to be able to share some of your thoughts on this with our audience as well as. Obviously, the last week or so in our country has been very tumultuous. With the the assassination of Charlie Kirk and then so much out there with results of people's response to that, and people's response to that, even on their personal devices.

But what's the impact for an employer? We have a late-night talk show host who was suspended yesterday. So, talk a little bit about it, maybe help our HR professionals out there. And some of them may be dealing with this already of “Where's the line between freedom of speech and what people can say in their own time, and the impact that could potentially have on their employment?” What are some things that our professionals should be aware of out there?

It just seems so timely right now that everybody's kind of addressing this in the wake of what's happened in the last week.

Declan Leonard

Yeah, I mean, it's a horrible event. And now we see it reverberating a bit in workplaces. And the way that's happening is people are not going into the office and talking about it, and that's where they're getting into trouble. It's what they're doing on their own time, what they're posting on social media. And there are so many examples out there of kindly saying insensitive things, but frankly, some of the stuff is really, really just horrible stuff that should not show up on social media at all.

And so what's happening is employers are finding out about this mostly because people are complaining to employers about it, but sometimes the employer sees it. And so, it puts the employer in a bit of a predicament because employers are… these are things that people are doing on their own. People are not associating with their companies when they're when they're doing this.

And so, you mentioned free speech. And sure, private citizens have the right to free speech under our Constitution. But that just means they can say things. That doesn't mean they're free from consequences. And so, I think that that's the misnomer. That's the fallacy that people don't understand, is that if you go out and say something just abominable online about this tragic event…

Joe Young

Or anything.

Declan Leonard

Anything! This is what brought this up.

Joe Young

But yes, this could happen in other situations.

Declan Leonard

This just happens to be so recent, so raw. And so, free speech does not protect your job in the private sector and government contractors out there: You are still private sector employers. And so, your employees are considered private sector. Your employees have free speech, but you can still take action if you deem it proper, if you think it brings bad repute to the company or whatever.

Now, where the line is, is a different issue at this point. Like, if somebody says, “I don't agree with stuff that he said,” is that enough to get somebody fired? But then there's so many examples out there of people who are just going so much further than that. And so, it really does put companies in quite the bind in terms of, “What do I do with an employee like this?”

Joe Young

What's the impact on other employees on how you act and the impact that has? It's really just a very challenging topic that you just don't want to be in that seat if you don’t have to. But, it is important for people to recognize you're not ultimately protected.

Declan Leonard

Yeah, yeah, yeah. No company should not find that they just have to sit back if they do feel - and they're making these decisions, we're seeing it. Washington Post columnist just got terminated for making comments about the assassination and Kirk in general. And companies are making these decisions and terminating. There's lots and lots and lots of examples.

Joe Young

It seems like every day you’re hearing about a new one.

Declan Leonard

A new one. Yeah, yeah, yeah. And it'll be interesting to see in the months and perhaps even years that ensue. Like, do these people challenge these terminations under free speech? Under political speech, because there are some states that come into play and say political affiliation and political speech is not protected under the federal law.

But like, let's take Washington DC, for an example. They do treat political affiliation as a protected class. And so if somebody gets online and says, “I didn't agree with his politics at all,” and then they get fired for that, as opposed to them saying something really, really horrible about the event itself, is that somebody who potentially could come back and try to challenge their termination?

I don't know. It'll be interesting to see how that all happens down the line. But, I think we're raising it more - we'd be remiss almost not to - because it's a big issue in employment law. And I'm surprised at how many HR departments are having to confront this.

I thought this might be more like stuff that you only read in the newspaper. Like, here are some examples of some egregious situations that our employees are doing. I'm seeing it.

Joe Young

You're dealing with it already in practice.

Declan Leonard

I'm seeing it in practice. And I'm really surprised that this is one that's really reverberating definitely within workplaces.

Joe Young

And I think, the summary we take from so many of our Round-Ups is, it's challenging to be a professional in the HR space.

Declan Leonard

Very much.

Joe Young

Even as we highlight a lot. Even more so, so many times in the government industry. So, again, hats off to our HR professionals out there. Keep up the good fight. And continue to try to make the best decisions for you and your organization.

Declan Leonard

Happy end of the fiscal year!

Joe Young

Happy end of the fiscal year.

We look forward to seeing you in the new year in October. We will be back here on Thursday, October the 16th. If we find out where Seth is, we'll invite him to join us again in October. So hopefully, we'll be back with all of us in October. But again, thank you all for joining us. Hope this information was helpful.

As always, we appreciate your time. Enjoy the rest of the fall. Happy end of the year for our government contractors out there.

Declan Leonard

Go Commanders. Beat Eagles.

Joe Young

Well, that's not till December.

That's down the road a little bit. But everybody, all the best out there and look forward to talking to you next month and take care.