Stupid question.... What's the actual purpose of a contract tower like this if the new company just uses the same people? Knowing nothing about the inner working, they just seem like a middle man.
Well, the benefit to the gov't is obvious: They want a service provided per the requirements in the contract. Not doing the work in-house means the gov't doesn't carry the overhead of hiring and managing the personnel to do the job, etc. (For other contracts, they may also not have to carry the overhead for training, physical equipment, etc.)
Another benefit is in having flexibility to change the size of a workforce for a task. As Trump and Musk may be about to find out, it's not trivial to just fire most gov't employees. There's a process to be followed. But contracts give the gov't opportunities to "quickly" and substantially revamp how a function is staffed, or whether the function is staffed at all, since all contracts eventually expire. There are various options when contracts run out...extensions, requesting new bids for the same contract terms, requesting new bids after making changes to contract terms to increase or decrease the scope of work, or opting not to issue any new contracts at all.
It's not uncommon for a workforce to transition from one company to another when an ongoing task gets transitioned to a new contract. Sometimes, companies change business focus and opt not to re-bid, guaranteeing that another company will take over. Sometimes, another company will provide a more attractive bid (not always lower price, but in some way perceived to be better performance or value by the gov't folks evaluating the bids).
So how do companies handle that contract transition? Sometimes, the new contractor will have their own trained workforce (think a construction company, for instance). In those situations, it's "out with the old contract employees and in with the new". But sometimes, the service being performed is highly-specialized, like ATC. In those cases, it's typical for the existing employees to be offered jobs by the new company, and if they accept, they just get a "badge swap"--they were Amalgamated, Inc. employees on Friday, and become Synergy, Inc. employees on Monday. They might have different benefits, different company policies, and different pay with the new company, but they'll likely have the same job (at least at first, to ease the transition).
Most of the time, that process works well, or at least "okay enough". Companies bidding on contracts do a lot of work to ensure they can make a profit if they win, and if they know they need the existing workforce to get the job done, they know they're going to have to provide them with competitive compensation to retain them. And if a company puts in a lowball bid that doesn't make any sense, the gov't is not going to blindly award the contract because they'll know the bidder is unlikely to be able to fulfill the terms.
So it's a little bit surprising to me that this situation is happening. I'm sure there's more to the story that we're not privy to.
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