The Service Contract Act requires federal service contractors to provide certain fringe benefits to their employees. Some contractors pay cash in lieu of providing the benefits. Since the Fair Labor Standards Act requires payment of overtime based on a regular rate of pay, there’s a question as to whether cash-in-lieu payments must be added to wages to come up with the regular rate of pay. Read on to see how the Department of Labor and several courts reach different conclusions and how contractors should weigh their options.
Read MoreThe award of an emergency follow-on contract to a new successor contractor doesn’t change the operation of the Service Contract Act (“SCA”) Section 4(c) succcessor contractor rule. The follow-on contract is still subject to the wages and fringe benefits set forth in the collective bargaining agreement (“CBA”) entered into by the predecessor contractor.
Read MoreThe new Federal Contractor Minimum Wage will make it difficult for contractors to bid on new contracts without knowing how the Government will compensate them for the cost of increased wages.
Read MoreThat seemingly benign boilerplate is not toothless throw-away verbiage. When negotiating a contract modification that pays a claim or resolves a dispute, consider whether there are contingencies you might be waiving. Bottom line - stop and think before you sign.
Read MoreThe SCA bars contractors from allocating their own plan administrative expenses towards compliance with the prevailing H&W fringe benefit However, this doesn’t bar an employer from claiming a credit for the expenses borne by the benefit plan. This dichotmy sometimes produces disputes and misunderstandings. Lately, DOL has been eying a more aggressive stance on administrative expenses.
Read MorePresident Joe Biden signed an Executive Order increasing the federal contractor minimum wage to $15.00 an hour.
Read MoreThe Department of Labor released Field Assistance Bulletin 2021-2 returning the department to the prior practice of seeking pre-litigation liquidated damages in the majority of cases.
Read MoreIncreasing service contract employee wages is laudable. Likewise, there should be robust and fair enforcement to ensure adherence to applicable laws, wage rates, and benefits. However, true reform must also include sound acquisition policy that incentivizes competitive compensation and benefits for employees and simplifies the process of finding the correct wage rates under the Service Contract Act.
Read MoreU.S. Department of Labor decides to end the Payroll Audit Independent Determination program because they believe that worker are entitled to every penny they earn and the program allowed employers to escape liquidated damages and civil penalties.
Read MoreThe child labor laws have long prohibited minors from performing time sensitive delivery services. The idea is they are too tender and inexperienced as drivers, and it is unsafe work. Recently, a pizza palor business learned that ancient taboo the hard way, with DOL imposing civil money penalties for child labor violations.
Read MoreCan you get debarred and lose your federal contracts for a Service Contract Act violation? In a word, yes. However, proactive contractors can minimize the consequences of an otherwise honest mistake—the commission of which is not uncommon.
Read MoreIn with the new and out with the old. Marty Walsh takes the helm at DOL and new proposed rulemaking and pull backs of the Trump Administration’s tip credit initiatives continue apace. Elections have consequences.
Read MoreThe independent contractor and joint employer initiatives of the Trump Administration are headed for the graveyard.
Read MoreThe FLSA may permit employers to pay their salaried employees using a fluctuating work week (“FWW”) method that only results in a payment of a half-time premium for overtime hours worked.
Read MoreThe relationship between gig economy businesses such as Uber and Lyft and the people who do their work has come under considerable scrutiny as state and local governments have struggled over whether their wage and hour laws should apply to gig economy workers. But what happens to gig businesses if they have federal contracts? Will their workers be entitled to prevailing wages and benefits? Well—perhaps yes.
Read MoreWhen it comes to proposal submission, late is late, for material RFP requirements, even if it is your subcontractor’s data which is untimely. It is a harsh but long-standing rule of law for offerors.
Read MoreJust some musings on practicing government contracts law and the stability of the federal contracting community.
Read MoreEmployers who encourage employee participation in a vaccination plan through a one-time bonus, may run some wage and hour risks. There is a limited group of payments that can be excluded from the regular rate of pay. A Covdi-19 vaccination bonus isn’t one of those specifically identified payments. Since “no good deed goes unpunished” and with respect to nondiscretionary bonuses, the employer may have to worry about increasing their overtime liability for Fair Labor Standards Act (“FLSA”) covered employees if the bonus is found to be included in th eregular rate of pay. .
Read MoreWe’ve all heard the old adage that a deal’s a deal. The Armed Services Board of Contract Appeals recently demonstrated how this adage can cost a federal contractor a fair chunk of change when it comes to the cost of increasing wages owed to service contract employees—especially for work performed overseas. Bottom line - carefully determine what your contract requires for service employee wages and benefits. Then, make sure your proposal meets those requirements and ensure that you’re protected from the shock of increased costs.
Read MoreCivil Money Penalties were subject to their annual adjustment. This year it was about a 1.2% upward adjustment. This includes the FLSA penalties. But it didn’t affect the CWHSSA or PCA penalties since they are rounded to a whole number and the inflation factor was not significant enough to cause that to happen.
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