Key Terms for Contract Labor Laws
Administrator: The Administrator for DoL’s Wage and Hour Division
The “Act” (or SCA) – McNamara-O’Hara Service Contract Act of 1965 (as amended).
ALJ – Administrative Law Judge. Serves on DoL’s Administrative Review Board to hear issues concerning SCA or DBA.
ARB – Administrative Review Board. The DoL entity that adjudicates matters pertaining to Federal labor law.
ASBCA – Armed Services Board of Contract Appeals. Issues legal opinions pertaining to most Federal agencies.
Averaging H&W – Under SCA, minimum health and welfare (H&W) fringe benefit requirements are stated as a per-hour rate to be paid in addition to the minimum wage listed on the wage determination (WD). On certain SCA WDs, an employer may comply by ensuring that the overall amount paid by the employer for such benefits at least averages the required H&W rate for all hours worked by the covered workers. See 29CFR Part 4.
Bona Fide Fringe Benefits – Fringe benefits provided by the employer to the employee which meet the definitions and requirements under SCA for compliance, as defined in 29 CFR Part 4, Section 4.171.
BLS - DoL’s Bureau of Labor Statistics. BLS conducts surveys and gathers statistical information on economic issues involving labor. The surveys are used as part of the information necessary to issue WDs.
Bridge Contract – Generally speaking, a short-term contract awarded by a federal agency to “bridge” the gap between a longer-term predecessor contract that is ending, and the new follow-on contract that is being solicited.
CBA – Collective bargaining agreement. A contract between an employer and the representative of the employees, often a union. Terms of a CBA include wages, benefits, assignments, working conditions, grievance and seniority procedures, etc.
CFR - U.S. Code of Federal Regulations. Contains regulations published by each federal agency, including DoL. (See www.wdol.gov Library Page to link to these documents.).
Conformance – A process under SCA for an employer to use to request an enforceable SCA or DBA wage and benefit rate for a classification that is required in the performance of the contract but is not listed on the applicable WD. The employer must submit a proposed rate for the classification, the employee(s) working in the classification must sign the proposal concurring or disagreeing with the employer’s proposal, the federal agency’s contracting officer may concur or disagree with the proposal, and DoL approves or denies the employer’s request.
Contract – A mutually binding agreement or document between two or more parties. Federal contracting agencies may award contracts to private sector companies (or other entities) for the purpose of acquiring goods, services, or construction.
Contracting Officer (CO) – The government official authorized to award, modify, administer and/or terminate a federal contract, and to make related determination and findings. The CO is the contractor’s official point of contact for all matters related to a particular contract.
Contractor – The party performing the service or delivering the good(s) to the contracting agency.
CWHSSA – Contract Work Hours and Safety Standard Act. Applicable to certain construction and service contracts. CWHSSA requires overtime premiums and safety and health standards for specific workers.
DBA/DBRA – Davis-Bacon Act or Davis-Bacon and Related Acts. The minimum wage and fringe benefit requirements applicable to contracts for construction, reconstruction, alteration or repair of public buildings or public works. DBA “Related Acts” are statutes that were passed to provide for some specific purpose (e.g. appropriate bills that provide federal funding for construction or maintenance of public housing or highways) AND that include a requirement that work be performed in compliance with the provision of DBA.
Debarment – A process by which DoL or another federal agency may deny a company the award of a Federal contract. A debarment ruling may be issued for up to three years, and is generally the result of a contractor’s violation of labor or procurement law.
DoL - U.S. Department of Labor
Exempt Employees – Employees who are not subject to the minimum wages, fringe benefits, or other provisions of FLSA, SCA, or DBA because they meet the requirements stated in the statues or in regulations for an exemption.
FAR - Federal Acquisition Regulation. Published at 29CFR Part 48, the FAR lists regulations that govern acquisition and procedures for Federal agencies. Most Federal agencies publish supplements to the FAR that contain further procedures governing the agency’s procurements.
FBs – Fringe benefits.
FLSA – Fair Labor Standards Act. FLSA requires employers to pay minimum wages and overtime premiums, restricts child labor, and requires payroll recordkeeping. Regulations issued under the statute govern the definitions of wages; hours worked; and exemptions for executive, administrative, professional, and outside sales, and other workers.
- Effective July 24, 2007, the FLSA minimum wage was $5.85 per hour.
- Effective July 24, 2008, the FLSA minimum wage was $6.55 per hour.
- Effective July 24, 2009, the FLSA minimum wage will be $7.25 per hour.
FY – Fiscal year. The Federal Government’s fiscal year is October 1st through September 30th. CY, or calendar year, is January 1st through December 31st5. Contract years may also vary.
GOCO – Government-Owned and Contractor-Operated facilities or equipment.
Health and Welfare (H&W) – Fringe benefits listed on most SCA WDs as requirements that must be met in addition to paying the stated SCA minimum wages. H&W generally includes benefits such as medical, life, and disability insurance, sick leave, pension, retirement, or other similar plans. H&W requires that benefits be “bona fide” as defined in 29 CFR Part 4, Section I71. H&W does NOT include vacation or holidays that are required separately by the WD.
Invitation for Bids (IFB) – An invitation, issued by a federal contracting agency for contractors or other entities to submit a bid to provide goods, services, or construction under contract with the agency. With IFBs, only the lowest price, technically acceptable bid is selected.
Job or Position Descriptions – A detailed description of the work performed by each worker classification listed on an SCA WD, as defined in DoL’s Service Contract Act Directory of Occupations. (See www.wedol.gov Library Page for a link to this document.)
MW – Minimum wage, generally used with SCA, FLSA, or DBA.
NCS and OES – National Compensation Surveys and Occupational Employment Surveys. These surveys are conducted by DoL’s BLS and provide wage data used by the Wage and Hour Division to issue WDs.
Non-Exempt Employees – Those employees who do not meet the statutory requirements for an exemption under FLSA, SCA, or DBA, and who therefore are subject to the protections of minimum wages, fringe benefits, overtime compensation, and other requirements of the Acts.
Per-Person (or Single) H&W Rate – Under SCA, minimum H&W requirements are stated as a per-hour rate to be paid in addition to the minimum wage listed on the wage determination (WD). On certain SCA WDs, an employer must comply by paying for such benefits at an amount at least equal to the stated H&W rate for all hours paid to a worker each week, up to a total of 40 hours per week. “All hours paid each week” includes work hours and paid leave hours (See 29CFR Part 4).
Predecessor Contract – For SCA Section 4(c) purposes, a predecessor contract is the SCA-covered contract which was previously performed at the same locality for the purpose of providing the same services.
Prevailing Wages – Wage rates based on data from DoL surveys and other information that generally reflect an average rate paid to certain employee classifications within a specific geographical location.
Request for Proposal (RFP) – A request, or invitation, issued by a federal contracting agency for contractors or other entities to submit proposals to provide goods, services, or construction under contract with the agency. Generally, more than low price is used for selecting the winning contractor.
Request for SCA Price Adjustment – A contractor’s request, generally submitted under FAR clause 52.222-43 or similar clauses, for an adjustment to a contract’s otherwise fixed price, based on changes in the contract’s SCA wage and benefit requirements.
Review and reconsideration – The process by which a Federal agency, contractor, or other interested party may appeal wage or benefit rates issued by DoL in a WD, or decision issued by DoL on such matters as coverage, exemptions, conformances or other related subjects.
Secretary – The Secretary of Labor
Service Employees – Employees engaged in the performance of a service contract (see Exempt Employees and Non-Exempt Employees).
Successor Contract – Under SCA Section 4(c), a new contract that succeeds an SCA-covered contract previously performed in the same locality for the same services (or the exercise of an option or issuance of an extension of an existing SCA-covered contract). (See 29 CFR Part 4).
Support Service Contract – A contract to perform services in support of a Federal installation. Often these contracts involve work that used to be performed by civil servants.
Wage and Hour Division (WHD) – Within DoL’s Employment Standard Administration, WHD administers and enforces labor laws including FLSA, SCA, and DBA.
Wage Determinations (WDs) – DoL issues WDs under SCA and DBA provisions. WDs publish minimum wages and fringe benefits for each classification listed on the WD. Area WDs generally reflect wages that are prevailing for a broad number of classifications working in a specific, often broad, geographic area. Industry-specific WDs reflect wages and benefits prevailing in certain unique industries (e.g. elevator maintenance services, fast-food restaurants, and driver services). CBA WDs reflect collective bargaining agreements determined by DoL to be protected and applicable to successor contractor workers under SCA Section 4(c).