FAR 52.219-16 — Liquidated Damages — Subcontracting Plan
Establishes liquidated damages for primes that fail to make good-faith effort to comply with their Small Business Subcontracting Plan.
When This Clause Applies
Required alongside FAR 52.219-9 (Subcontracting Plan) in non-small-business contracts above the SAT.
What This Means for Contractors
Damages equal the actual dollar amount by which the contractor missed each socioeconomic subcontracting goal. Good-faith effort is a defense — documented outreach, fair consideration, and reasonable accommodation can prevent damages even when goals are missed.
Common Pitfalls
- 1Not maintaining documentation of subcontractor outreach
- 2Treating SSR/ISR filings as compliance — they're reports, not effort
- 3Confusing 'good-faith effort' with 'best effort' — they have different standards
Related Topics
Related Clauses
Utilization of Small Business Concerns
Requires large business primes to actively seek out small business subcontracting opportunities and treat small business participation as a contractual obligation.
Small Business Subcontracting Plan
Requires large business primes (other-than-small) to submit and maintain a Small Business Subcontracting Plan setting specific small business participation goals on contracts above the simplified acquisition threshold.
Continue Your Research
GSA Procurement Guide
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VA Procurement Guide
Veterans First Contracting Program — strongest SDVOSB/VOSB pipeline in the government.
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NAICS 541330 — Engineering Services
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