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Changes with Federal Government Security Clearances

​Working with the Feds requires an understanding of complex contract vehicles, understanding RFPs, SOWs, working with Proposal Teams and Recruiters in filling out matrices, longer than private sector time to close cycles, understanding bureaucracy and perhaps most uniquely Federal Government Security Clearance.


It goes without saying that in this day and age Security is of utmost critical importance for every organization and certainly with the Feds who deal with real cyber threats daily that are of National Security importance and may have adverse effects on Public Safety. It’s for this reason that Security will not get any easier, is not going away and in fact may be more onerous and complex for all of us in the years to come.

Currently in order to do business with Feds, Independent Contractors (ICs) have to be cleared generally at one of 3 basic levels: Reliability, Secret or Top Secret (and while there are a myriad of other levels and differences these are the most common with Secret being the most common of the three). Today the vast majority of ICs who hold Security Clearance with Feds do so at a personal level, in other words they are screened and cleared personally as John Q. Public.  This is a Personal Security Clearance (PSC).

Earlier this spring the Canadian Industrial Security Directorate (CISD) introduced to Industry Representative Associations like the National Association of Computer Consulting Businesses (NACCB) that effective immediately, Independents who are incorporated must additionally clear their incorporation or business entities under the Private Sector Organization Screening (PSOS) in addition to their PSC to qualify for government contracts. A PSOS means that their John Q Public Inc. must be cleared.  This clearance will require information on the structure and ownership of their incorporation, appointing a Chief Security Officer (CSO), Personal Screening for CSOs, a signed Security Agreement and signed CSO Attestation Forms.

As you may guess it will take some time and effort on the part of ICs, the agencies who work with them and CISD.  Currently there is a huge backlog of regular Security applications, renewals and duplications. The PSOS requirement will be added to this workload with already limited dedicated resources at CISD.

In the industry consultation with the Feds, they have made it clear that this requirement has been in place since 2012, however, it has not been enforced until now. The Feds have agreed it is likely a substantial undertaking and they will be absolutely reasonable in implementing it through a transition period they anticipate will happen over the next couple of years.

There is no doubt this will be a bit of a challenge but ICs should begin the process right away to avoid any disruption to your business. The bottom line is that in order to win business and be awarded contracts you will have to hold a PSOS.

So what is the good news in all this? What there is good news?! Yep. I believe there are some definite benefits in all this.

First and foremost you and your business will be fully registered with CISD and can continue to compete for contracts with the Feds. In addition you and your business will be able to hold your own Security without having a sponsoring entity hold it for you eliminating the need for “duplications”’ every time you bid or are awarded a contract. Finally and maybe most significantly, fully clearing and registering your Business entity is another strong indicator that you are running a business as an independent contractor which provides further evidence that you are not an employee in the eyes of the Canada Revenue Agency (CRA).