Tag Archives: Service Contract Act

Event: Service Contract Act & Davis-Bacon Act “101”

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The Biden administration recently announced plans to increase enforcement of the federal prevailing wage laws for contractors–the Service Contract Act and Davis-Bacon Act. Non-compliance with these laws can be grounds for severe sanctions. (Heck, the DOJ just announced another False Claims Act settlement in a prevailing wage case yesterday!)

If you’re new to the world of prevailing wage laws, or just need a refresher, please join me on March 18 for an introductory “101” look at the SCA and DBA, hosted by the South-West Texas Border Small Business Development Center Network. It’s easy to register: just click here.

Hope to see you on the 18th!

GAO: VA’s Market Research Improperly Compared Apples to Oranges, Violated Rule of Two

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Under the VA’s Rule of Two, the VA is required to set aside solicitations for veteran-owned businesses if there is a reasonable expectation of receiving offers from two or more such businesses capable of performing the required work at a fair and reasonable price. But how reasonable does the VA’s expectation have to be in a given procurement?

GAO recently reviewed the reasonableness of VA’s efforts and found them lacking.

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For 2020, DOL Raises Minimum Wage for Federal Contractors to $10.80

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The Department of Labor annually increases the minimum wage for federal contractor employees in accordance with Executive Order 13658. It recently noticed, via the Federal Register, that the 2020 minimum wage for most of these employees will increase from $10.60 to $10.80. For tipped employees, the cash wage will increase from $7.40 to $7.55.

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GAO: Protest Failed to Establish Legal Reason to Sustain

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When protesting at GAO, it’s important to explain not only what you believe the agency did wrong, but also the legal significance of that departure.

That’s what Trinity Global Consulting learned recently when GAO dismissed its protest.

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A Pre-Award Protest Probably Isn’t the Place to Raise Suspicions of Wage Violations

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Let’s suppose you’re a contractor that provides services to the federal government. Typically, your contract will require you to pay your employees the prevailing wage rates promulgated under the Service Contract Act.

What if you suspect that, under previous contracts, your competitors failed to pay their employees the mandated prevailing rates? Can you use a pre-award bid protest to obligate a procuring agency to police possible ongoing non-compliance through solicitation provisions? If you say yes, perhaps you should keep reading.

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Board: Contractor On Hook For Incumbent Employees’ Vacation Time

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The Service Contract Act requires contractors to pay certain provide no less than certain prevailing wages and fringe benefits (including vacation) to its service employees. The amount of vacation ordinarily is based on an employee’s years of service—and service with a predecessor contractor counts. The FAR’s Nondisplacement of Qualified Workers provision, in turn, requires follow-on contractors to offer a “right of first refusal” to many of those same incumbent employees.

A follow-on contractor is to be given a list of incumbent service personnel, but that information ordinarily isn’t available at the proposal stage. So what happens when a follow-on contractor unknowingly underbids because it isn’t aware how much vacation is owed to incumbent service personnel? The answer, at least in a fixed-price contract, is “too bad for the contractor.”

So it was in SecTek, Inc., CBCA 5036 (May 3, 2017)—there, the Civilian Board of Contract appeals held that a contractor must pay employees retained from the incumbent nearly $170,000 in wage and benefit costs based on its underestimate of those costs in its proposal.

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ASBCA: Government Properly Terminated Contractor for Preliminary Finding of SCA Violation

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The government can terminate a contract when the Department of Labor has made a preliminary finding of non-compliance with the Service Contract Act, even if the contractor has not exhausted its remedies fighting or appealing the finding.

The 3-0 (unanimous) decision by the Armed Services Board of Contract Appeals in Puget Sound Environmental Corp., ASBCA No. 58828 (July 12, 2016) is troubling because it could result in other contractors losing their contracts based on preliminary DOL findings–perhaps even if those preliminary findings are later overturned.

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