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Service Contract Act (SCA)

Also called: SCA, Service Contract Labor Standards, SCLS, McNamara-O'Hara Service Contract Act, health and welfare

The Service Contract Act requires contractors on federal service contracts above a dollar threshold to pay service employees at least the wages and fringe benefits in the applicable Department of Labor wage determination, or the rates in a predecessor's collective bargaining agreement.

The statute is 41 U.S.C. Chapter 67, the FAR coverage is Part 22.10 with the clause at FAR 52.222-41, and the regulations are 29 CFR Part 4. The wage determination lists occupations by code with an hourly rate, plus a health and welfare fringe amount per hour, paid vacation and holidays. It is incorporated into the solicitation and updated at each option exercise, with price adjustment allowed under FAR 52.222-43. Janitorial, grounds, security, food service, help desk and many staffing contracts are SCA work.

What to check: that every proposed position maps to a wage determination occupation (or needs a conformance under 29 CFR 4.6(b)), that your price carries the fringe as cash or benefits, the collective bargaining agreement of the incumbent if there is one, and the record keeping and posting requirements. The Fair Labor Standards Act still applies on top.

What it is not: applicable to state or local contracts, which use state prevailing wage or living wage rules instead, or to the professional and executive employees exempt under 29 CFR 541.

See also: Prevailing wage and wage determinations, Davis-Bacon Act, Labor category, Price volume

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