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Government shutdown affects business contracts

On Behalf of | Feb 5, 2019 | Contract Disputes |

When you’re contracted to work for another company, you expect to get paid. That’s a problem that is faced by Transportation Security Administration (TSA) agents at Punta Gorda Airport (PGD). The government has already shut down once, and if there is a shutdown again, it could mean that these agents are again working without pay.

TSA is keeping the airport open with federal agents, but the current airport’s contractor is in a legal bind. Why? It’s not normal for federal agents to work in PGD. The airport has contracts with private companies, and two companies are currently in court seeking that contract.

The private companies aren’t currently working since there is no guaranteed pay and that has brought in the need for federal workers. It’s necessary to keep the airports open, but this could be at the expense of private contractors’ livelihoods.

Contracts are sometimes violated in extreme situations like a government shutdown. If someone can’t pay, private employees are likely to walk away from the job and even sue for the wages they’re owed. It’s typically a breach of contract to not pay workers.

If you are involved in a dispute with another company, workers or contractors, it’s important to make sure they hold up their end of the contract and you hold up yours. When you initially create a contract, you should account for unusual situations, like government shutdowns, so that you can be prepared for the worst and have methods for handling disputes during those times. Arbitration clauses, for example, could help keep you out of court and save money in the long term.


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