The following article was prepared by Mike Taylor, C.P.M., for distribution to ISM affiliate newsletters

Fair Labor Laws

If you have the good fortune to prepare service contracts on behalf of the government or a government contractor, then you must be familiar with the Fair Labor Standards Acts FLSA as they apply to government contracts. It's a confusing set of laws that we flow down in our contracts to subcontractors. Basically, the FLSAs are designed to protect the rights and wages of workers. The Acts dealing with wages, basically say that workers have to be paid a wage that is fair and prevailing for the location where the work is being performed. Of course, which Act covers which category of worker and the specific wage which applies, gets much more complicated.  It's so complex that I take advantage of opportunities to review updated publications about the Acts whenever I have a chance.

What happens if a contractor violates one of the FLS Acts?  Here is an answer relative to the Service Contract Act:

The SCA provides authority to withhold contract funds to reimburse underpaid employees, terminate the contract, hold the contractor liable for associated costs to the government, and debar from future government contracts for a period of three years any persons or firms who have violated the SCA.

Here is a recent DOE update and some information.

DOE Policy Flash 2012-63 Published an updated the DOE Acquisition Guide 22.1 Labor Standards for Constructions. Chapter 22.1 includes a review of the difference between Davis Bacon and Service Contract Wage standards and their applicability to different kind of subcontracts. This is not a definitive analysis of the regulation but more of an implementation instruction that is clearer and easier to interpret.

DOE Acquisition Guide Web Page:

 Included in the DOE-AG is a reference to a useful resource on the Department of Labor web site. The Field Operations Handbook (FOH) is an operations manual that provides Wage and Hour Division (WHD) investigators and staff with interpretations of statutory provisions, procedures for conducting investigations, and general administrative guidance [relative to the Fair Labor Standards Acts].

The page includes the expected disclaimer stating, inter alia, “…these pages may not reflect current legislation, regulations, significant court decisions, and decisions and opinions of the WHD Administrator and no express or implied guarantees are indicated.”
DOL Wage and Hour Division (WHD) ; Field Operations Handbook (FOH)

Other Dept. of Labor References

FAQ page for FLSA
Field Bulletins
Rulings and Interpretations

Hope it helps.!

Mike Taylor

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