OPM cancels its sole-source award for Workday HR services

The Office of Personnel Management abruptly canceled a sole-source contract for HR services from Workday on Friday, roughly a week after it was awarded.

Despite its initial justification describing the agency’s urgent need for services only Workday could provide, OPM clawed back the justification and terminated the $342,200 award “for convenience.” 

The agency didn’t respond to FedScoop’s request for comment for further information about why the contract was canceled, including whether it planned to hold a competition for the award or whether not having the services quickly would impact the agency’s upcoming modernization deadlines.

In its original justification, OPM said that the sole-source award — those made to a single company without a bidding process — was needed “due to an urgent confluence of operational failures and binding federal mandates that require immediate action.” 

OPM cited its outdated HR systems, saying they’d reached a point of failure that is causing errors and disruptions. The Trump administration’s workforce restructuring efforts necessitate having “real-time” data as well as “integrated HR capabilities that OPM’s current systems cannot deliver,” OPM said.

At the time, OPM estimated that holding a competition would cause a six- to nine-month delay in the award, while risking compliance and cost issues.

Disclosure of the award came shortly before OPM published guidance outlining a rapid timeline for making federal retirements — which currently rely mostly on paper records — fully digital. That was an issue it said in the disclosure that the new Workday system would solve.

In response to a request for comment about the cancellation, a Workday spokesperson said the company “remains committed to supporting the federal government with its HR modernization efforts.”

Meanwhile on Monday, Workday released a report with the results of a survey in which 100 HR leaders in the federal government were asked about the state of workforce management and modernization. According to a Workday press release announcing that report, 89% of respondents said that outdated HR systems in the federal government were “significantly hindering agency performance and mission delivery.”

This story has been updated with additional information about Workday’s federal HR report.