SLA

An SLA (service level agreement) is the part of a service or operations contract that sets measurable quality targets for the service. It states how available the service must be, how quickly the supplier must respond to and fix faults, and what happens when the targets are missed. In public IT contracts, service levels are often built on national standard contracts, such as the Norwegian SSA agreements.

How does an SLA work?

An SLA is not regulated by procurement law. It is a matter of contract law, and the service levels are part of the contract performance conditions that the contracting authority sets in the tender documents. Directive 2014/24/EU only requires that such conditions are linked to the subject matter and stated in advance. Several countries have standard contracts with ready-made service level annexes, for example SSA in Norway, EVB-IT in Germany and CCAG-TIC in France.

Typical measurement points in an SLA:

• Uptime: for example 99.5 to 99.9 percent per month within the agreed service hours.
• Response and resolution time: different deadlines per fault category, often A (critical), B (serious) and C (minor).
• Recovery time: how quickly the service must be back after a major incident.
• Reporting: how and how often the supplier documents the service level achieved.

When targets are missed, the contract sets the consequences. The most common is a standardised service credit, an automatic deduction from the fee. The contract may also include liquidated damages for delay, price reductions and a right to terminate for material breach. The authority uses the reports in contract monitoring, and service levels often work as key performance indicators for the whole contract period.

An example: A cloud provider has a service contract with a Norwegian government agency based on SSA-L, the standard agreement for ongoing online services. The agreement requires 99.8 percent uptime and that A faults are fixed within four hours. In March, uptime is measured at 99.2 percent. That triggers the standard compensation, without the agency having to prove an actual loss.

Why does an SLA matter for suppliers?

Service levels drive both your risk and your price. A high level requires more staff, on-call cover and technical redundancy, and service credits can eat into your margin if you promise more than you can deliver. Read the SLA annex carefully before you bid, and work out what a miss would actually cost.

Also check how measurement works: what counts as service hours, whether planned maintenance is excluded, and which tools do the measuring. Small details here decide whether you hit the target. Tools like Cobrief help you find the service level requirements in the tender documents early, so you can assess them before you spend time on the bid.

Frequently asked questions

Is an SLA breach the same as a breach of contract?

Not necessarily. A single miss usually only triggers a service credit. Repeated or serious misses can still amount to a material breach, which may give the customer the right to terminate.

Can we propose our own service levels in the bid?

It depends on the tender documents. If the service level is a minimum requirement, you must meet it. Many authorities let you offer a better level, which may earn points in the evaluation. A level below the minimum can lead to rejection.

How is uptime measured?

Usually as a percentage of the agreed service hours in a month, with agreed planned downtime excluded. The definition is in the SLA annex, so read it before you commit.

In short: an SLA makes quality measurable. For you as a supplier it is both a promise you must be able to keep and a cost you must price in.