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McNamara-O’Hara Service Contract Act of 1965 – As Amended

McNamara-O’Hara Service Contract Act of 1965 – As Amended. FAR Subpart 22.10. Purpose. Mandatory provisions to provide: Minimum wages & fringe benefits Safe & sanitary working conditions Notification to employees Minimum allowable compensation

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McNamara-O’Hara Service Contract Act of 1965 – As Amended

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  1. McNamara-O’Hara Service Contract Act of 1965 – As Amended FAR Subpart 22.10

  2. Purpose Mandatory provisions to provide: • Minimum wages & fringe benefits • Safe & sanitary working conditions • Notification to employees • Minimum allowable compensation • Equivalent Federal employee classifications and wage rates

  3. Applicability • Over $2,500 • Performance within the US • Principle purpose is to furnish services • Examples of covered contracts (FAR 22.1003-5): • (d) Food service & lodging • (k) Maintenance & repair of equipment, e.g., engines & electrical motors (22.1003-6 distinguishes between “repair” and “remanufacturing”)

  4. Exemptions • Construction • Walsh-Healey • Transportation • Communications act of 1934 • Postal contract stations • ADP, scientific, medical, or office machine equipment

  5. Exemptions • Employment contracts with individuals • Administrative limitations, variances, tolerances, and exemptions • Positions classified as “bona fide executive, administrative, or professional capacity” • Defined in 29 CFR 541 • E.G., Doctors, lawyers, accountants

  6. Collective Bargaining Agreements (CBA) • Predecessor contracts containing a CBA • FAR 22.1008-2 • Follow-on contracts >$2,500 • Substantially the same services • Performed in the same locality • Must pay wages & fringe benefits at least equal to those in CBA under predecessor contract (section 4(c) of the act)

  7. Wage Determinations • Definition • FAR 22.1001: minimum wages or fringe benefits applicable to the employment in a given locality of one or more classes of service employees • Use www.wdol.gov to retrieve WDs • Submission of SF98 & 98a to DoL no longer required if WD is available on-line…but…

  8. Selecting WDs • You will still need most of the same information as was required on the 98 & 98a • Place of performance (County & State) • Employee classifications • FAR 52.222-42, Statement of Equivalent Rates for Federal Hires

  9. Place of Performance • National Association of Counties web page • http://www.naco.org/Template.cfm?Section=Data_and_Demographics&Template=/cffiles/counties/city_srch.cfm • FAR 22.1009: Place of performance unknown

  10. Employee Classifications • Service Contract Act Directory of Occupations, 5th Edition • Available at: http://www.dol.gov/esa/whd/regs/compliance/wage/SCADirV5/SCADirectVers5.pdf • Occupational descriptions – ensure you’ve selected the appropriate classification • Federal grade equivalent – what the GS or WG classification would be if the employee were a Federal employee

  11. Statement of Equivalent Rates for Federal Hires • FAR 52.222-42 must be filled-in • Determine Federal grade equivalents: http://www.dol.gov/esa/whd/regs/compliance/wage/SCADirV5/Vers5ContentsTable.pdf • Determine hourly rates for each classification: • GS positions • http://www.opm.gov/oca/07tables/indexGS.asp • Use Step 1 • WG positions: • http://www.cpms.osd.mil/wage/ • Use Step 2 for nonsupervisory; use Step 3 for supervisory

  12. Administrative Requirements • FAR 22.1018, “Notification to Contractors and Employees” • DoL Pub WH-1313 (poster) with WD attached provided to contractor at time of award • Don’t forget to include 52.212-5 & a copy of the WD as part of a PO/contract

  13. Requests to DoL • If no applicable WD is available on-line, an e98 must be submitted requesting a WD from DoL • If the employee classification is not listed on the WD, the classification must be “conformed”

  14. Clauses • 52.212-5 (c)(1) • 52.222-41, SCA (dated July 2005) • 52.212-5(c)(2) • 52.222-42, Equivalent Rates • Fill in with classifications and rates • Consider 52.222-44, FLSA & SCA Price Adjustment if lengthy performance period

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