Government Contracting and Wage Determination under the SCA

Pertinent Provisions of the SCA Regarding Government Contracting

The Service Contract Act (SCA) is a law that mandates government contracting companies to observe minimum wage payment, health and safety standards, and keep a record of transactions open for auditing and inspection.

Under the SCA, government contracting companies must pay workers with service contracts exceeding $2500 the prevailing wage. Workers with service contracts below $2500 may not be paid the prevailing wage or fringe benefits, but are required to be paid not less than the federal minimum wage based on the Fair Labor Standards Act. Every provision in the Service Contract Act (SCA) apart from the safety and health requirements are overseen and administered by the Wage and Hour Division.

What You Must Remember about the SCA If You are a Government Contractor

Although the Service Contract Act (ACA) covers the entire territory of the United States, it does not mean that is can be applied to all government contract work. There are several exceptions to the application of the SCA.

Some of these include contracts for the operation of postal contract stations, contracts covered by the Walsh-Healey Public Contracts Act, and contracts with commercial services, among others. To know all exceptions in government contracting work under the SCA, government contracting companies are advised to read the Service Contract Act (SCA) Administrative: Variances & Exemptions.  

To get a copy of the SCA directory, government contracting companies should visit Wage Determinations Online. Business owners are required to follow the terms laid down by the SCA, including paying the prevailing wage and applying safety and health standards in the workplace. Failure to do so can result to withholding contract funds, contract termination, financial liability, or debarment from future contracts with the government.

Service Contract Act: Method for Wage Determination

Wage determinations for prevailing wage rates under the SCA are developed based on the available data showing the dominant wage rate in a particular locality or area. If similar wage rates are paid to more than 50% of the workers of the same trade within a specific locality, that wage rate is going to become the prevailing wage rate for that area. The statistical measurements of central tendency are used when the wage information used comes from the Bureau of Labor Statistics.

Wage determinations must be reviewed constantly, at least once a year. Even if the contract only requires less than five workers, the contracting agency is still required to request a wage determination for a specific project in excess of $2500.

If you think there are particular trades or occupational titles that have not been covered by the prevailing wage determination in your locality, you may contact the Service Contract Wage Determinations branch of the Wage and Hour Division.

Understand Government Contracting and Wage Determination under the SCA with ARCHER JORDAN!

ARCHER JODAN has years of experience as an advisor to government contracting companies working under the terms of the Service Contract Act (SCA). We know the usual issues faced by government contracting companies trying to comply with this law, and we also know how you can effectively improve your company by following these regulations.

Do not let your lack of understanding limit your participation in government contracting activities. Contact ARCHER JORDAN today and see how we can help your company grow!

5-Easy Steps to Fringe Benefit Compliance

In this FREE guide we’ll show you how to create a fringe benefit plan that secures your business

   
           
   

Categories

ACA
AD & D
Affordable Care Act
AHCA
AK Prevailing Wage
AL Prevailing Wage
AR Prevailing Wage
AZ Prevailing Wage
CA Prevailing Wag
CA Prevailing Wage
CA Prevailing Wage 401k
Call Centers
CO Prevailing Wage
COBRA
Compliance Tips
Critical Illness
CT Prevailing Wage
Davis Bacon Act
DE Prevailing Wage
Department of Labor
Disability Insurance
Education
Employee Benefits
Employee Training
Employer Tips
ERISA
Farm Labor Plan
Fixed Indemnity
FL Prevailing Wage
Fringe Benefits
GA Prevailing Wage
Government Contracting
Government Contractors
Health and Welfare Wrap
Healthcare Benefits
HI Prevailing Wage
Hospitality
Hospitality Benefits
Hourly Seasonal Workers
Hourly Workforce
Human Resources
ID Prevailing Wage
IL Prevailing Wage
IN Prevailing Wage
IO Prevailing Wage
IRS
KS Prevailing Wage
KY Prevailing Wage
LA Prevailing Wage
Limited Medical
MA Prevailing Wage
Major Medical Insurance
McNamara-O’Hara Act
MD Prevailing Wage
ME Prevailing Wage
MEC
MEC and MVP
MEC MVP
MI Prevailing Wage
MN Prevailing Wage
MO Prevailing Wage
MS Prevailing Wage
MT Prevailing Wage
MVP
NC Prevailing Wage
ND Prevailing Wage
NE Prevailing Wage
NH Prevailing Wage
NJ Prevailing Wage
NM Prevailing Wage
NSRMCA Members
NV Prevailing Wage
NY prevailing wage
OH Prevailing Wage
OK Prevailing Wage
OR Prevailing Wage
OSHA
PA Prevailing Wage
Part Time Employees
Podcast Guest Appearances
Prevailing Wage
Prevailing Wage Workers
Restaurant Group Benefits
Retirement Plans
RI Prevailing Wage
SC Prevailing Wage
SCA Audits
SCA Compliance
SD Prevailing Wage
SDVOB
SDVOSB
Seasonal Workers
Service Contract Act
Small Business
Staffing
State Prevailing Wage
SUB Plan
Supplemental Benefits
Supplemental Unemployment
Third Party Administrator
TN Prevailing Wage
Trust Services
TX prevailing wage
Uncategorized
UT Prevailing Wage
VA Prevailing Wage
Violations – SCA
Voluntary Benefits
WA Prevailing Wage
Wellness
WI Prevailing Wage
Workplace Health
Workplace Safety
WV Prevailing Wage
WY Prevailing Wage