Rejection & Correction of Nonconforming Work
Also known as: Nonconforming supplies, rejection, correction/replacement
What you do here: Cure or replace rejected work promptly, or contest a rejection you believe is wrong
At a Glance
- What triggers it
- Supplies or services that don't conform to the contract's requirements
- Government's choices
- Reject; require correction/replacement at no added price; or accept at a reduced price if in its interest
- Governing authority
- FAR 46.407 (nonconforming supplies/services) and the Inspection clauses (e.g. 52.246-2)
- Who bears the cost
- The contractor — correcting or replacing nonconforming work is at your expense
- If you don't cure
- The government can have it corrected elsewhere and charge you, or terminate for default
What It Is
Rejection is what happens when the government inspects work before acceptance and finds it doesn't conform to the contract. FAR 46.407 sets the policy for nonconforming supplies or services, and the Inspection clauses supply the mechanics. The contracting officer has a menu of responses. The government may reject the nonconforming work outright and require you to correct it or replace it — at no increase in the contract price, because it's your defect. Alternatively, if correction or replacement isn't worth it and acceptance is in the government's interest, the CO can accept the nonconforming work at a reduced price (a consideration) that reflects its reduced value — this usually requires documentation and, for material nonconformances, review at an appropriate level. If you're required to correct or replace and you don't do it promptly, the government can have the work redone by someone else and charge you the cost, or terminate the contract for default. Rejection is the pre-acceptance sibling of the latent-defect remedy: before acceptance, the government's leverage is broad (reject, correct, replace, price reduction); after acceptance, the government is generally limited to the narrow latent-defect / fraud / gross-mistake exceptions. For the contractor, the practical reality is that a rejection converts finished work back into work-in-progress you have to fix for free — and delays the acceptance that unlocks your payment.
When You See It
- When government inspection before acceptance finds supplies or services that don't conform.
- When the government rejects and directs you to correct or replace the nonconforming work.
- When the government decides to accept nonconforming work at a reduced price because correction isn't worth it.
- When you fail to cure promptly and the government reprocures the correction or terminates for default.
Key Features
| Feature | What It Means |
|---|---|
| Correction/replacement at no added price | Because nonconformance is the contractor's defect, correcting or replacing rejected work carries no increase in the contract price. |
| Price reduction as an alternative | When acceptance is in the government's interest, the CO can accept nonconforming work at a reduced price reflecting its reduced value. |
| Documentation for material nonconformance | Accepting a material nonconformance generally requires documentation and higher-level review, protecting both sides. |
| Consequences for not curing | Fail to correct promptly and the government can have the fix done elsewhere and charge you, or terminate for default. |
| Broad leverage before acceptance | Before acceptance the government's remedies are broad; after acceptance they narrow to latent defects, fraud, or gross mistakes. |
The SDVOSB Angle
A rejection is one of the fastest ways a small SDVOSB's set-aside goes underwater, because you fix the work for free *and* you don't get paid until conforming work is accepted — a double hit to cash flow. Respond decisively: if the nonconformance is real, cure it fast to avoid an outside-correction charge or a default that will scar your CPARS and FAPIIS record. But don't reflexively concede — if you believe the work actually conformed, or the government is measuring against a requirement that isn't in the contract, document your position and pursue an equitable adjustment or a claim rather than eating the cost. Where a similarly situated subcontractor produced the nonconforming work, the rejection still lands on the prime; inspect subs' work before you tender it and build back-charge rights into your subcontracts so the cost can flow to the responsible party.
How to Handle It
- Get the rejection in writing and pin down exactly which requirement the work allegedly failed.
- If the nonconformance is real, correct or replace promptly to avoid outside-correction charges or a default.
- If you disagree, document conformance and raise it — don't silently absorb a wrongful rejection.
- Consider whether a negotiated price reduction (consideration) is cheaper than correction, and propose it if so.
- Enforce back-charge rights against a subcontractor whose work caused the nonconformance.
Watch Out For
- Slow-walking a correction and drawing an outside-correction charge or a default termination.
- Conceding a rejection measured against a requirement that isn't actually in the contract.
- Forgetting correction/replacement is at no increase in price — the cost is entirely yours.
- Not building sub back-charge rights, so a sub's defect becomes the prime's uncompensated loss.
Run the Numbers
Frequently Asked
What happens when the government rejects nonconforming work?
Under FAR 46.407 and the Inspection clauses, when work doesn't conform to the contract the government may reject it and require the contractor to correct or replace it at no increase in the contract price, or — if it's in the government's interest — accept the nonconforming work at a reduced price reflecting its reduced value. If the contractor doesn't correct promptly, the government can have the correction done elsewhere and charge the contractor, or terminate for default.
Can the government pay less for nonconforming work instead of rejecting it?
Yes. When correcting or replacing the work isn't worthwhile and acceptance is in the government's interest, the contracting officer can accept nonconforming supplies or services at a reduced price — a consideration that reflects the reduced value. For a material nonconformance this generally requires documentation and review at an appropriate level. A negotiated price reduction can be cheaper for a contractor than correction or replacement, so it's worth proposing when the nonconformance is minor.
Do I have to accept a rejection?
Not automatically. If the nonconformance is real, curing it quickly is usually the right call to avoid outside-correction charges or a default. But if you believe the work actually conformed, or the government is applying a requirement that isn't in the contract, you can contest the rejection — document your position and pursue an equitable adjustment or a Contract Disputes Act claim. Silently absorbing a wrongful rejection gives away money and can invite more of the same.
Primary Sources
- FAR 46.407 — Nonconforming supplies or services
- FAR 52.246-2 — Inspection of Supplies—Fixed-Price
- FAR 46.408 — Single-agency assignments of Government contract quality assurance
Plain-English reference, not legal advice. Quality, inspection, acceptance, and warranty rules are fact-specific, and the FAR and agency supplements are amended from time to time — always read the current FAR text, follow the inspection and acceptance requirements in your specific contract clauses, confirm the requirements with the contracting officer, and consult qualified counsel before relying on an inspection, acceptance, rejection, or warranty position.
Change log (1)
- LaunchedPublished the federal contract quality assurance, inspection & acceptance reference covering how the government checks, rejects, accepts, and warrants an SDVOSB's work on a set-aside — government contract quality assurance (FAR Part 46), the Inspection of Supplies (52.246-2), Services (52.246-4), and Construction (52.246-12) clauses, higher-level quality requirements / ISO 9001 & AS9100 (52.246-11), acceptance and its near-finality (FAR Subpart 46.5), the rejection and correction of nonconforming work (FAR 46.407), the latent-defect / fraud / gross-mistake exceptions to conclusive acceptance, and contract warranties (FAR Subpart 46.7 / 52.246-17 to -21) — each with an at-a-glance quick-facts card, a when-you-see-it list, a key-features table, an SDVOSB-specific angle, a how-to-handle-it checklist, watch-outs, FAQPage, Article, Dataset, and BreadcrumbList structured data, primary-source FAR citations, and cross-links into the glossary, regulation explainers, clauses, forms, contract types, payment methods, protest & dispute forums, how-to guides, FAQ, and the limitations-on-subcontracting and price-to-win calculators.