Stop Work Orders: What Contractors Need to Know

A Stop Work Order (SWO) is a written order from the contracting officer directing the contractor to stop all or part of the work under a contract.

Key characteristics:

• Must be in writing from CO
• Can be partial or complete work stoppage
• Temporary — up to 90 days typically
• Government responsible for increased costs

FAR clause:

FAR 52.242-15 (Stop-Work Order) governs SWOs in fixed-price contracts.

Why government issues SWOs:

• Funding issues
• Requirements changes
• Investigations or audits
• Technical problems
• Protests affecting the contract
• Administrative needs

Important distinction:

• Stop work order — Temporary suspension, work expected to resume
• Termination — Contract ending (for convenience or default)

Immediate actions:

1. Verify authority — Confirm order is from contracting officer
2. Understand scope — Which work is stopped?
3. Acknowledge receipt — Written acknowledgment
4. Stop the work — Comply with order
5. Preserve evidence — Document status at stop point

Documentation to maintain:

• Copy of stop work order
• Work status when order received
• Costs incurred to stop point
• Ongoing costs during stoppage
• Personnel affected
• Subcontractor impacts

What you should NOT do:

• Ignore the order
• Continue work without authorization
• Wait to document impacts
• Assume it will resolve quickly

Protective steps:

• Minimize ongoing costs
• Take reasonable steps to protect work in progress
• Notify subcontractors
• Begin tracking stop-work costs

Recoverable costs:

Under FAR 52.242-15, contractor may recover reasonable costs resulting from the stop-work order:

• Idle labor and equipment
• Material storage and preservation
• Subcontractor stop-work costs
• Demobilization and remobilization
• Schedule impacts
• Extended overhead

Cost tracking requirements:

• Separate accounting for stop-work costs
• Document link to stop-work order
• Track both direct and indirect impacts
• Keep contemporaneous records

Mitigation requirement:

• Take reasonable steps to minimize costs
• Reassign personnel if possible
• Don't incur unnecessary costs
• Document mitigation efforts

Unrecoverable costs:

• Lost profit on stopped work (typically)
• Costs not properly documented
• Costs that could have been avoided

Standard duration:

FAR 52.242-15 limits stop-work orders to 90 days unless extended.

Before 90 days expires, government must:

• Cancel the stop-work order and resume work, OR
• Extend the stop-work order (requires your consent for certain costs), OR
• Terminate the contract

If order exceeds 90 days without action:

• You may request cancellation
• If denied, treated as termination for convenience
• Full T4C cost recovery available

Extensions:

• Government may extend with written modification
• You're not obligated to agree
• Negotiate continued cost recovery

Tracking deadlines:

• Mark 90-day expiration date
• Send reminder to CO before expiration
• Document all communications

When stop-work order is cancelled:

Contractor resumes work under adjusted terms.

Equitable adjustment:

• Request adjustment within 30 days of resumption (per FAR)
• Cover increased costs from stop-work period
• Adjust delivery schedule if affected
• Document all impacts

Elements of adjustment:

• Stop-work period costs
• Remobilization costs
• Schedule extension
• Impact on remaining work

Resumption challenges:

• Personnel may have been reassigned or departed
• Subcontractors may have moved on
• Material costs may have changed
• Learning curve to restart

Documentation for REA:

• All stop-work period costs
• Schedule impact analysis
• Remobilization estimates
• Effect on remaining work cost

See: Contract Modifications Guide

Stop work order (FAR 52.242-15):

• Fixed-price contracts primarily
• Up to 90 days
• Contractor cost recovery
• Specific clause governs

Suspension of work (FAR 52.242-14):

• Construction contracts
• Different procedures and timeframes
• Similar cost recovery concept

Government delay of work (FAR 52.242-17):

• Applies to supply/service contracts
• Government-caused delays
• Equitable adjustment available

Informal work stoppages:

• Verbal direction to slow/stop
• Should be documented
• May be constructive stop-work
• Same cost recovery principles

Know your clauses:

Check which clauses are in your contract — they determine your rights and procedures.

When you receive a stop-work order:

• Notify subcontractors immediately
• Issue corresponding stop-work to subs
• Document subcontractor costs
• Include sub costs in your recovery

Subcontract clauses:

• Should have stop-work provisions
• Flow down government contract terms
• Protect your ability to recover

Subcontractor impacts:

• May have committed resources
• May have limited ability to reassign
• May have different cost structures
• Must provide documentation for recovery

Communication:

• Keep subs informed of status
• Coordinate resumption planning
• Get cost data for REA
• Document everything in writing

Preparation (before it happens):

• Know your contract clauses
• Have stop-work procedures ready
• Ensure subcontracts have appropriate provisions
• Train project personnel on procedures

When order is received:

• Immediate written acknowledgment
• Establish separate cost accounting
• Document work status at stop point
• Notify all affected parties
• Begin cost tracking immediately

During stop-work period:

• Minimize costs where reasonable
• Maintain documentation
• Track timeline toward 90-day limit
• Communicate with CO on status
• Prepare for either resumption or termination

At resumption or termination:

• Submit REA within required timeframe
• Include all documented costs
• Request schedule adjustment if applicable
• Follow up to ensure timely resolution

See: Contract Disputes Guide if issues arise