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How Government Shutdowns Impact Federal
Contractors
Kimberly deCastro
Introduction
Kimberly deCastro is the founder and chief executive officer of
Wildflower, Inc., an IT and technology solutions provider with federal
contracts with several agencies, such as the General Services
Administration and the Department of Energy. During her tenure,
Kimberly deCastro has navigated three government shutdowns,
including the longest shutdown in American history.
Government shutdowns occur when Congress or the US President is
unable to pass a budget. During the Carter administration, Attorney
General Benjamin Civiletti interpreted that the Antideficiency Act
prevented government agencies from exceeding their given budgets
if a new budget has not passed. As a result, many agencies must
halt operations if a government shutdown occurs.
While federal employees are entitled to back pay during these
periods, federal contractors do not qualify. Instead, they may be
furloughed or allowed to continue working without pay. Affected
companies have several options. They may allow employees to use
their accrued paid time off or vacation pay to cover the weeks without
work. In other cases, agencies may be able to pay contractors by
using funding designated for multi-year contracts.

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How Government Shutdowns Impact Federal Contractors and Their Employees

  • 1. How Government Shutdowns Impact Federal Contractors Kimberly deCastro
  • 2. Introduction Kimberly deCastro is the founder and chief executive officer of Wildflower, Inc., an IT and technology solutions provider with federal contracts with several agencies, such as the General Services Administration and the Department of Energy. During her tenure, Kimberly deCastro has navigated three government shutdowns, including the longest shutdown in American history.
  • 3. Government shutdowns occur when Congress or the US President is unable to pass a budget. During the Carter administration, Attorney General Benjamin Civiletti interpreted that the Antideficiency Act prevented government agencies from exceeding their given budgets if a new budget has not passed. As a result, many agencies must halt operations if a government shutdown occurs.
  • 4. While federal employees are entitled to back pay during these periods, federal contractors do not qualify. Instead, they may be furloughed or allowed to continue working without pay. Affected companies have several options. They may allow employees to use their accrued paid time off or vacation pay to cover the weeks without work. In other cases, agencies may be able to pay contractors by using funding designated for multi-year contracts.