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-part 22). However, the specific circumstances of the contract will dictate the appropriate
-duration. Options for increased quantities of supplies or services can be expressed in various
-ways, such as a percentage increase of specific line items, an increase in specific line items, or
-additional numbered line items. Contract term extensions can be expressed as an amended
-completion date or as additional time for performance. In some cases, solicitations may require
-that options be offered at prices no higher than those for the initial requirement, such as when
-future competition for the option is impracticable. In these situations, the solicitation should
-specify how the government will evaluate an offer containing an option price higher than the
-base price.
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-FC 17.204-1 Determination and finding for exercise of an option.
-When exercising an option, it's essential to determine that the option price is fair and reasonable
-based on current market conditions and that exercise of the option is in the best interest of the
-government. To make this determination, consider various factors, such as whether a new
-solicitation would produce a better price or more advantageous offer. If a new solicitation is
-unlikely to yield a better result, it may be reasonable to exercise the option. Other factors to
-consider include informal market analysis, the time elapsed since contract award, and market
-stability. Additionally, take into account the government's need for operational continuity and
-potential disruption costs, as well as the potential impact on small businesses.
-To ensure compliance with full and open competition requirements, the option needs to be
-evaluated as part of the initial competition, and its exercisable amount needs to be specified in
-or reasonably determinable from the basic contract. Examples of acceptable option pricing
-include specific dollar amounts, amounts determined by a formula or provision in the contract, or
-prices subject to economic price adjustments or changes in prevailing labor rates. When
-exercising an option, the contract modification or notification document should cite the option
-clause as authority. By following these best practices, contracting officers can ensure that option
-exercises are fair, reasonable, and in the best interest of the government.
-FC 17.401 Leader company contracting.
-Objectives of leader company contracting include but are not limited to: reducing delivery time;
-achieving geographic dispersion of suppliers; maximizing the use of scarce tooling or special
-equipment; achieving economies of production; ensuring uniformity and reliability in equipment,
-compatibility, or standardization of components, and interchangeability of parts; eliminating
-problems in the use of proprietary data that cannot be resolved by more satisfactory solutions;
-or facilitating the transition from development to production and to subsequent competitive
-acquisition of end items or major components.
-Leader company contracting is best used only when the leader company (1) has the necessary
-production knowledge and is able to provide necessary assistance to the follower(s); (2) no
-other company can meet the government’s requirements without the assistance of the leader
-company; (3) the assistance required of the leader company is limited to that which is essential
-to enable the follower(s) to provide the items; and (3) its use is authorized in accordance with
-any agency procedures.
-When structuring contracts involving leader and follower companies, contracting officers can
-consider various approaches to facilitate collaboration. For instance, they may award a prime
-contract to a leader company, requiring it to subcontract with a designated follower company, or
-award separate contracts to the leader and follower companies. To ensure a successful
-partnership, it's essential to include a clear agreement on the handling of sensitive information,
-such as trade secrets or proprietary data. Additionally, when using leader company contracting,
-it's a best practice for the government to reserve the right to approve subcontracts between the
-leader and follower companies, promoting transparency and oversight in the contractual
-arrangement.
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-FC 17.802-3(b) Reverse auction service provider fees.
-A service platform for conducting reverse auctions may be provided by a commercial or
-government entity. While some reverse auction service providers are paid directly by the
-government for reverse auction services, other providers may incorporate a fee structure that
-uses an indirect payment method. When using an indirect payment method, the reverse auction
-service provider adds a fee(s) to the price of the successful offer that is provided to the
-government at the close of an auction. The government then pays the successful offeror the
-total price of the offer, which includes the fee(s) added by the reverse auction service provider.
-The reverse auction service provider then collects its fee(s) from the successful offeror.+Part 22 - Application of Labor Laws to Government Acquisitions
+FC 22.001 Definitions.
+Wage and Hour Division means the unit in the Department of Labor to which is assigned
+functions of the Secretary of Labor under the Service Contract Labor Standards statute.
+Wage determination means a determination of minimum wages or fringe benefits made under
+41 U.S.C. 6703 or 6707(c) applicable to the employment in a given locality of one or more
+classes of service employees.
+FC 22.4 Department of Labor regulations involving construction.
+Under the statutes and Executive orders referred to in FAR subpart 22.4 and Reorganization
+Plan No. 14 of 1950 (3 CFR 1949-53 Comp., p. 1007), the Secretary of Labor has issued
+regulations in title 29, subtitle A, Code of Federal Regulations, prescribing standards and
+procedures to be observed by the Department of Labor and the federal contracting agencies.
+Those standards and procedures applicable to contracts involving construction are implemented
+in this subpart.
+The Department of Labor regulations include:
+● Part 1, relating to Construction Wage Rate Requirements statute minimum wage rates;
+● Part 3, relating to the Copeland (Anti-Kickback) Act and requirements for submission of
+weekly statements of compliance and the preservation and inspection of weekly payroll
+records;
+● Part 5, relating to enforcement of the:
+○ Construction Wage Rate Requirements statute;
+○ Contract Work Hours and Safety Standards statute; and
+○ Copeland (Anti-Kickback) Act;
+● Part 6, relating to rules of practice for appealing the findings of the Administrator, Wage
+and Hour Division, in enforcement cases under the various labor statutes, and by which
+Administrative Law Judge hearings are held;
+● Part 7, relating to rules of practice by which contractors and other interested parties may
+appeal to the Department of Labor Administrative Review Board, decisions issued by the
+Administrator, Wage and Hour Division, or administrative law judges under the various
+labor statutes;
+● Part 10, relating to establishing a minimum wage for federal contractors; and
+● Part 13, relating to establishing paid sick leave for federal contractors.
+Refer all questions relating to the application and interpretation of wage determinations
+(including the classifications therein) and the interpretation of the Department of Labor
+regulations in this subsection to the Administrator, Wage and Hour Division.
+FC 22.4 Construction Wage Rate Requirements statute wage determinations.
+The Department of Labor is responsible for issuing wage determinations reflecting prevailing
+wages, including fringe benefits. The wage determinations apply only to those laborers and
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+mechanics employed by a contractor upon the site of the work including drivers who transport to
+or from the site materials and equipment used in the course of contract operations.
+Determinations are issued for different types of construction, such as building, heavy, highway,
+and residential (referred to as rate schedules), and apply only to the types of construction
+designated in the determination within a specified geographic area.
+FC 22.4 General wage determination.
+General wage determinations contain no expiration date and remain valid until modified,
+superseded, or canceled by the Department of Labor. Once incorporated in a contract, a
+general wage determination normally remains effective for the life of the contract, unless the
+contracting officer exercises an option to extend the term of the contract. These determinations
+should be used whenever possible. They are issued at the discretion of the Department of
+Labor either upon receipt of an agency request or on the Department of Labor's own initiative.
+General wage determinations are published on the Wage Determinations at the SAM.gov
+website. General wage determinations are effective on the publication date of the wage
+determination or upon receipt of the wage determination by the contracting agency, whichever
+occurs first. “Publication” within the meaning of this section means the first date the wage
+determination is published on the Wage Determinations at SAM.gov.
+Archived Construction Wage Rate Requirements statute general wage determinations that are
+no longer current may be accessed in the “Archived DB WD” database on Wage Determinations
+at SAM.gov website for information purposes only. Contracting officers may not use an archived
+wage determination in a contract action without obtaining prior approval of the Department of
+Labor. To obtain prior approval, contact the Department of Labor, Wage and Hour Division,
+using SAM.gov, or contact the procurement agency labor advisor listed on SAM.gov.
+FC 22.4 Project wage determination.
+Once incorporated in a contract, a project wage determination normally remains effective for the
+life of the contract, unless the contracting officer exercises an option to extend the term of the
+contract.
+FC 22.4 Wage determinations - general requirements.
+When more than one rate schedule is contained in the general wage determination, the
+contracting officer may either include only the rate schedules that apply to the particular types of
+construction (building, heavy, highway, etc.) or include the entire wage determination and
+clearly indicate the parts of the work to which each rate schedule will be applied. Inclusion by
+reference is not permitted.
+The Wage and Hour Division has issued the following general guidelines for use in selecting the
+proper schedule(s) of wage rates:
+● Building construction is generally the construction of sheltered enclosures with walk-in
+access, for housing persons, machinery, equipment, or supplies. It typically includes all
+construction of such structures, installation of utilities and equipment (both above and
+below grade level), as well as incidental grading, utilities and paving, unless there is an
+established area practice to the contrary.
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+● Residential construction is generally the construction, alteration, or repair of single family
+houses or apartment buildings of no more than four (4) stories in height, and typically
+includes incidental items such as site work, parking areas, utilities, streets and
+sidewalks, unless there is an established area practice to the contrary.
+● Highway construction is generally the construction, alteration, or repair of roads, streets,
+highways, runways, taxiways, alleys, parking areas, and other similar projects that are
+not incidental to building, residential, or heavy construction.
+● Heavy construction includes those projects that are not properly classified as either
+building, residential, or highway, and is of a catch-all nature. Such heavy projects may
+sometimes be distinguished on the basis of their individual characteristics, and separate
+schedules issued (e.g., dredging, water and sewer line, dams, flood control, etc.).
+● When the nature of a project is not clear, it is necessary to look at additional factors, with
+primary consideration given to locally established area practices. If there is any doubt as
+to the proper application of wage rate schedules to the type or types of construction
+involved, guidance should be sought before the opening of bids, or receipt of best and
+final offers, from the Administrator, Wage and Hour Division. Further examples are
+contained in Department of Labor All Agency Memoranda Numbers 130 and 131.
+FC 22.403(e) Notification of improper wage determination before award.
+If the contracting officer is notified of an improper wage determination for the primary site of the
+work, the contracting officer should-
+For sealed bids, if received before bid opening, postpone the bid opening date, if necessary, to
+allow a reasonable time to (i) obtain the appropriate determination if a new wage determination
+is required, (ii) amend the solicitation to incorporate the determination (or rate schedule), and
+(iii) permit bidders to amend their bids. If the appropriate wage determination does not change
+any wage rates and would not warrant amended bids, the contracting officer should amend the
+solicitation to include the number and date of the new determination.
+If received after bid opening but before award, delay awarding the contract, if necessary, and if
+required, obtain the appropriate wage determination.
+For negotiated acquisitions, delay award, if necessary, and process the notification of an
+improper wage determination for the primary site of the work in the same manner as a new
+wage determination.
+FC 22.404-1(f)(1) Examinations of the payrolls and payroll statements.
+Fringe benefits payments, contributions made, or costs incurred on other than a weekly basis
+should be considered as a part of weekly payments to the extent they are creditable to the
+particular weekly period involved and are otherwise acceptable.
+FC 22.404-2 Disposition of disputes concerning construction contract labor standards
+enforcement.
+The areas of possible differences of opinion between contracting officers and contractors in
+construction contract labor standards enforcement include:
+● Misclassification of workers;
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+● Hours of work;
+● Wage rates and payment;
+● Payment of overtime;
+● Withholding practices; and
+● The applicability of the labor standards requirements under varying circumstances.
+When requesting the contractor to take corrective action in labor violation cases, the contracting
+officer should inform the contractor of the following:
+● Disputes concerning the labor standards requirements of the contract are handled under
+FAR clause 52.222-14, Disputes Concerning Labor Standards, and not under FAR
+clause 52.233-1, Disputes.
+● The contractor may appeal the contracting officer's findings or part thereof by furnishing
+the contracting officer a complete statement of the reasons for the disagreement with the
+findings.
+FC 22.10 Examples of contracts covered by the Service Contract Labor Standards
+statute.
+The following examples, while not definitive or exclusive, illustrate some of the types of services
+that have been found to be covered by the Service Contract Labor Standards statute (see 29
+CFR 4.130 for additional examples):
+● Motor pool operation, parking, taxicab, and ambulance services.
+● Packing, crating, and storage.
+● Custodial, janitorial, housekeeping, and guard services.
+● Food service and lodging.
+● Laundry, dry-cleaning, linen-supply, and clothing alteration and repair services.
+● Snow, trash, and garbage removal.
+● Aerial spraying and aerial reconnaissance for fire detection.
+● Some support services at installations, including grounds maintenance and landscaping.
+● Certain specialized services requiring specific skills, such as drafting, illustrating, graphic
+arts, stenographic reporting, or mortuary services.
+● Electronic equipment maintenance and operation and engineering support services.
+● Maintenance and repair of all types of equipment, for example, aircraft, engines,
+electrical motors, vehicles, and electronic, office and related business and construction
+equipment (but see FAR 22.1002-1(e)(1) and (f)(1)(iv)).
+● Operation, maintenance, or logistics support of a federal facility.
+● Data collection, processing and analysis services.
+FC 22.10 Repair distinguished from remanufacturing of equipment.
+Contracts principally for remanufacturing of equipment which is so extensive as to be equivalent
+to manufacturing are subject to 41 U.S.C. chapter 65 rather than to the Service Contract Labor
+Standards statute. Remanufacturing should be deemed to be manufacturing when the criteria in
+either paragraphs (1) or (2) are met.
+(1) Major overhaul of an item, piece of equipment, or materiel which is degraded or inoperable,
+and under which all of the following conditions exist:
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+● The item or equipment is required to be completely or substantially torn down into
+individual component parts.
+● Substantially all of the parts are reworked, rehabilitated, altered and/or replaced.
+● The parts are reassembled so as to furnish a totally rebuilt item or piece of equipment.
+● Manufacturing processes similar to those which were used in the manufacturing of the
+item or piece of equipment are utilized.
+● The disassembled components, if usable (except for situations where the number of
+items or pieces of equipment involved are too few to make it practicable) are
+commingled with existing inventory and, as such, lose their identification with respect to
+a particular piece of equipment.
+● The items or equipment overhauled are restored to original life expectancy, or nearly so.
+● Such work is performed in a facility owned or operated by the contractor.
+(2) Major modification of an item, piece of equipment, or material which is wholly or partially
+obsolete, and under which all of the following conditions exist:
+● The item or equipment is required to be completely or substantially torn down.
+● Outmoded parts are replaced.
+● The item or equipment is rebuilt or reassembled.
+● The contract work results in the furnishing of a substantially modified item in a usable
+and serviceable condition.
+● The work is performed in a facility owned or operated by the contractor.
+Remanufacturing does not include the repair of damaged or broken equipment which does not
+require a complete teardown, overhaul, and rebuild as described above, or the periodic and
+routine maintenance, preservation, care, adjustment, upkeep, or servicing of equipment to keep
+it in usable, serviceable, working order. Such contracts typically are billed on an hourly rate
+(labor plus materials and parts) basis. Any contract principally for this type of work is subject to
+the Service Contract Labor Standards statute. Examples of such work include the following:
+● Repair of an automobile, truck, or other vehicle, construction equipment, tractor, crane,
+aerospace, air conditioning and refrigeration equipment, electric motors, and ground
+powered industrial or vehicular equipment.
+● Repair of typewriters and other office equipment (but see FAR 22.1002-1(e)(1) and
+(f)(1)(iv)).
+● Repair of appliances, radios, television sets, calculators, and other electronic equipment.
+● Inspecting, testing, calibration, painting, packaging, lubrication, tune-up, or replacement
+of internal parts of equipment listed in the first three bullets of this list.
+● Reupholstering, reconditioning, repair, and refinishing of furniture.
+FC 22.10 Department of Labor responsibilities and regulations.
+Under the Service Contract Labor Standards statute, the Secretary of Labor is authorized and
+directed to enforce the provisions of the Service Contract Labor Standards statute, make rules
+and regulations, issue orders, hold hearings, make decisions, and take other appropriate action.
+The Department of Labor has issued implementing regulations on such matters as:
+● Service contract labor standards provisions and procedures (29 CFR part 4, subpart A);
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+● Wage determination procedures (29 CFR part 4, subparts A and B);
+● Application of the Service Contract Labor Standards statute (rulings and interpretations)
+(29 CFR part 4, subpart C);
+● Compensation standards (29 CFR part 4, subpart D);
+● Enforcement (29 CFR part 4, subpart E);
+● Safe and sanitary working conditions (29 CFR part 1925);
+● Rules of practice for administrative proceedings enforcing service contract labor
+standards (29 CFR part 6); and
+● Practice before the Administrative Review Board (29 CFR part 8).
+FC 22.1002-1(b) Applicability.
+This subpart does not apply to individual contract requirements for services in contracts not
+having as their principal purpose the furnishing of services. The nomenclature, type, or
+particular form of contract used by contracting agencies is not determinative of coverage.
+FC 22.1002-1(g) Administrative limitations, variations, tolerances, and exemptions.
+The Secretary of Labor may provide reasonable limitations and may make rules and regulations
+allowing reasonable variations, tolerances, and exemptions to and from any or all provisions of
+the Service Contract Labor Standards statute other than 41 U.S.C. 6707(f). These will be made
+only in special circumstances where it has been determined that the limitation, variation,
+tolerance, or exemption is necessary and proper in the public interest or to avoid the serious
+impairment of government business, and is in accord with the remedial purpose of the Service
+Contract Labor Standards statute to protect prevailing labor standards (41 U.S.C. 6707(b)).
+FC 22.1002-2(c)(1) Statement of equivalent rates for federal hires.
+Wages paid to blue collar employees should be the basic hourly rate for each class. The rate
+should be Wage Board pay schedule step two for nonsupervisory service employees and step
+three for supervisory service employees.
+Wages paid white collar employees should be an hourly rate for each class. The rate may be
+obtained by dividing the general pay schedule step one biweekly rate by 80.
+Local civilian personnel offices can assist in determining and providing grade and salary data.
+FC 22.1002-2(f) All possible places of performance not identified.
+If the place of performance is unknown, the contracting officer should attempt to identify the
+specific places or geographical areas where the services might be performed. The following
+may indicate possible places of performance:
+A. Locations of previous contractors and their competitors.
+B. Databases available via the Internet for lists of prospective offerors and contractors.
+C. Responses to a presolicitation notice (see FAR 5.204).
+If the contracting officer believes that there may be offerors interested in performing in
+unidentified places or areas, the contracting officer may include the following information in the
+synopsis and solicitation:
+● That the place of performance is unknown.
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+● The possible places or areas of performance that the contracting officer has already
+identified.
+● That the contracting officer will obtain wage determinations for additional possible places
+of performance if asked to do so in writing.
+● The time and date by which offerors must notify the contracting officer of additional
+places of performance.
+The closing date for receipt of offerors' requests for wage determinations for additional possible
+places of performance should allow reasonable time for potential offerors to review the
+solicitation and determine their interest in competing. Generally, 10 to 15 days from the date of
+issuance of the solicitation may be considered a reasonable period of time.
+FC 22.1002-3 Obtaining wage determinations.
+Contracting officers may obtain most prevailing wage determinations using the Wage
+Determinations at SAM.gov website. Contracting officers may also use the Department of
+Labor's e98 electronic process, located on the Wage Determinations at SAM.gov website, to
+request a wage determination directly from the Department of Labor. If the Wage
+Determinations at SAM.gov database does not contain the applicable prevailing wage
+determination for a contract action, the contracting officer may use the e98 process to request a
+wage determination from the Department of Labor.
+In using the e98 process to obtain prevailing wage determinations, contracting officers should
+provide as complete and accurate information on the e98 as possible. Contracting officers
+should ensure that the email address submitted on an e98 request is accurate.
+The contracting officer should anticipate the amount of time required to gather the information
+necessary to obtain a wage determination, including sufficient time, if necessary, to contact the
+Department of Labor to request wage determinations that are not available through use of the
+Wage Determinations at SAM.gov.
+Although the Wage Determinations at SAM.gov website provides assistance to the contracting
+agency to select the correct wage determination, the contracting agency remains responsible for
+the wage determination selected. If the contracting agency has used the e98 process, the
+Department of Labor will respond to the contracting agency based on the information provided
+on the e98. The contracting agency may rely upon the Department of Labor response as the
+correct wage determination for the contract.
+To obtain the applicable wage determination for each contract action, the contracting officer
+should determine the following information concerning the service employees expected to be
+employed by the contractor and any subcontractors in performing the contract:
+● Determine the classes of service employees to be utilized in performance of the contract
+using the Wage and Hour Division's Service Contract Act Directory of Occupations
+(Directory). The Directory can be found on Wage Determinations at SAM.gov Library
+Page, and is for sale by the Superintendent of Documents, U.S. Government Publishing
+Office.
+● Determine the locality where the services will be performed (see FAR 22.1002-3(a)(1)).
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+● Determine whether 41 U.S.C. 6707(c) applies (see FAR 22.1002-3(b), 22.1003(b), and
+22.1004-6).
+● Determine the wage rate that would be paid each class if employed by the agency and
+subject to the wage provisions of 5 U.S.C. 5341 and/or 5332 (see FAR 22.1002-2(c)(1)
+and the clause at 52.222-42).
+If the contracting officer has questions regarding the procedures for obtaining a wage
+determination, or questions regarding the selection of a wage determination, the contracting
+officer should request assistance from the agency labor advisor.
+FC 22.1002-3(b) Successorship with incumbent contractor collective bargaining
+agreement.
+If the contracting officer has timely received the collective bargaining agreement, the contracting
+officer may use the Wage Determinations at SAM.gov website to prepare a wage determination
+referencing the agreement and incorporate that wage determination, attached to a complete
+copy of the collective bargaining agreement, into the successor contract action. In using the
+Wage Determinations at SAM.gov process, it is not necessary to submit a copy of the collective
+bargaining agreement to the Department of Labor unless requested to do so.
+The contracting officer may also use the e98 process on Wage Determinations at SAM.gov to
+request that the Department of Labor prepare the cover wage determination. The Department of
+Labor's response to the e98 may include a request for the contracting officer to submit a
+complete copy of the collective bargaining agreement. Any questions regarding the applicability
+of the Service Contract Labor Standards statute to a collective bargaining agreement should be
+directed to the agency labor advisor.