Service Contract Act Wage Determination OnLine Request Process; Final
Rule
[08/26/2005]
Volume 70, Number 165, Page 50887-50899
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Part IV
Department of Labor
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Employment Standards Administration
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Wage and Hour Division
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29 CFR Parts 1 and 4
Service Contract Act Wage Determination OnLine Request Process; Final
Rule
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DEPARTMENT OF LABOR
Employment Standards Administration
Wage and Hour Division
29 CFR Parts 1 and 4
[RIN 1215-AB47]
Service Contract Act Wage Determination OnLine Request Process
AGENCY: Wage and Hour Division, Employment Standards Administration,
Labor.
ACTION: Final rule.
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SUMMARY: The Department of Labor (DOL) is amending two regulations to
allow for full implementation of the Wage Determinations OnLine (WDOL)
Internet Web site (http://www.wdol.gov) as the source for federal
contracting agencies to use when obtaining wage determinations issued
by the DOL for service contracts subject to the McNamara-O'Hara Service
Contract Act (SCA) and for construction contracts subject to the Davis-
Bacon Act and Related Acts (DBRA).
DATES: These rules are effective on September 26, 2005.
FOR FURTHER INFORMATION CONTACT: William W. Gross, Director, Office of
Wage Determinations, Wage and Hour Division, Employment Standards
Administration, U.S. Department of Labor, Room S-3028, 200 Constitution
Avenue, NW., Washington, DC 20210, telephone (202) 693-0062. This is
not a toll-free number.
You may direct questions of interpretation and/or enforcement of
regulations issued by this agency or referenced in this notice to the
nearest Wage and Hour Division District Office. Locate the nearest
office by calling the WHD toll-free help line at 1-866-4US-WAGE (1-866-
487-9243) between 8 a.m. and 5 p.m. in your local time zone, or log
onto the agency Web site for a nationwide listing of WHD District and
Area Offices at: http://www.dol.gov/esa/contacts/whd/america2.htm.
SUPPLEMENTARY INFORMATION:
I. Paperwork Reduction Act
This regulation is not subject to the Paperwork Reduction Act,
because it contains no new information collection requirements and does
not modify any existing requirements.
II. Section 508 of the Rehabilitation Act
The Wage Determinations OnLine (WDOL) Internet Web site (http://www.wdol.gov
), an electronic information resource, is subject to and
will be developed and maintained in accordance with the accessibility
requirements of Section 508 of the Rehabilitation Act, 29 U.S.C. 794d.
III. Summary of Changes
The SCA requires contractors and subcontractors performing services
on prime contracts in excess of $2,500 to pay service employees in
various classes no less than the wage rates and fringe benefits found
prevailing in the locality as determined by the Secretary of Labor (or
authorized representative), or the rates (including prospective
increases) contained in a predecessor contractor's collective
bargaining agreement.
SCA section 4, 41 U.S.C. 353, authorizes the Secretary of Labor to
enforce the Act, make rules and regulations, issue orders, hold
hearings, make decisions based upon findings of fact and take other
appropriate action. The DOL rules relating to SCA administration are
contained in Regulations, 29 CFR part 4.
Section 1 of the Davis-Bacon Act (DBA), as amended, 40 U.S.C. 3141
et seq., requires that each contract over $2,000 to which the United
States or the District of Columbia is a party for the construction,
alteration, or repair of public buildings or public works shall contain
a clause setting forth the minimum wages to be paid to various classes
of laborers and mechanics employed under the contract. The DBA requires
contractors or their subcontractors to pay workers employed directly
upon the site of the work no less than the locally prevailing wages and
fringe benefits paid on projects of a similar character as determined
by the Secretary of Labor.
Regulations, 29 CFR part 1, contain the procedures for making and
applying determinations of prevailing wage rates and fringe benefits
pursuant to the DBA and any other Federal statute providing for
determinations of such wages (the Davis-Bacon Related Acts) by the DOL
in accordance with the provisions of the DBA.
The DOL published a Notice of Proposed Rulemaking in the Federal
Register on December 16, 2004 (69 FR 75408), proposing to update its
regulations to have contracting agencies use the WDOL Internet website
to meet their obligation to obtain DBA general wage determinations from
the Wage and Hour Division (WHD). The DOL proposed to publish wage
determinations solely through WDOL and to discontinue publishing notice
of changes in the Federal Register and to no longer publish paper
copies of general wage determinations through the Government Printing
Office (GPO). WDOL offers users the opportunity to request e-mail
notice of future revisions to a wage determination they have selected
for a specific period of time, or until a specific date.
For SCA wage determinations, the DOL proposed to eliminate the
paper Form SF-98 and replace it with an electronic e98 process by which
contracting agencies may continue to request SCA wage determinations
from the WHD. The DOL also proposed to allow use of WDOL as an
alternative means of obtaining SCA wage determinations. The DOL further
proposed to update pertinent statutory citations for applicable laws to
reflect amendments to Title 40 of the U.S. Code and to make other minor
editorial revisions and updates to its regulations.
The development of WDOL required an update of the existing
regulations, which now also provides a basis for updating related
information in the Federal Acquisition Regulations (FAR) to be
compatible with the DOL rule. WDOL does not affect how the WHD
determines prevailing wages under either the SCA or DBA.
29 CFR Part 1
The proposed rule adopted the WDOL website as the single source for
obtaining DBA general wage determinations and eliminated publication of
notices in the Federal Register. Notice of future modifications and
supersedeas general wage determinations will be posted on WDOL. The
proposed rule also eliminated references to GPO publication of general
wage determinations, although GPO may continue, at its discretion, to
publish general wage determinations. The proposed rule retained the
requirement in the current regulations under 29 CFR 1.5 that Federal
contracting agencies request a wage determination by preparing and
mailing Form SF-308 to the Department of Labor, for those infrequent
situations when a DBA general wage determination is not available
through WDOL. The DOL processed fewer than 100 Forms SF-308 in FY 2004,
and did not believe providing Federal agencies with an electronic
submission option in these rare cases justified the considerable
expense that developing such a system would require.
29 CFR Part 4
The proposal drew upon technological advances of recent years and
the wide use of electronic communication and information sharing. It
replaced the paper Standard
[[Page 50889]]
Form SF-98 request and response process for obtaining SCA wage
determinations with an electronic e98 process and enabled contracting
agencies alternatively to use the WDOL website to obtain SCA wage
determinations.
The DOL has been working with contracting agencies to develop
better and more efficient mechanisms for agencies to obtain SCA wage
determinations. With the advent and expansion of the Internet in the
mid-1990s, several contracting agencies approached the WHD seeking the
ability to access and download SCA wage determinations. The vast
majority of the covered service contracts awarded by these agencies
were either options or renewals, and the applicable SCA wage
determinations for these contracts were well established. By this time,
the WHD had developed a standard set of SCA wage determinations that
applied to most of these contracts. The National Technical Information
Service (NTIS) had posted these wage determinations on the Internet for
information purposes, and the agencies requested the ability to
download and use these standard wage determinations in appropriate
situations. This led to the WHD entering into Memoranda of
Understanding (MOUs) with several agencies to allow them to use these
standard wage determinations without first submitting an SF-98. Under
the MOUs, the agencies agreed to train their personnel in the proper
selection and use of SCA wage determinations. The agencies also agreed
to monitor the SCA wage determinations database and to use any
subsequent revisions of the applicable wage determinations that were
issued before the applicable procurement dates specified in the SCA
regulations. After the agency selected an applicable SCA wage
determination, it would notify the WHD of its selection by the
submission of a Form SF-98 after the fact.
This MOU program further implemented the remedial purpose of the
SCA by requiring that participating agencies monitor the SCA wage
determination database and use the latest revisions published in a
timely manner before award or commencement of the contract. With the
paper Form SF-98, the WHD had no mechanism to follow-up and advise
contracting agencies when wage determinations were revised or updated.
Because the MOU program proved to be quite successful, it subsequently
was expanded to numerous other agencies.
An interagency work group composed of representatives from the
Office of Management and Budget, Department of the Army, Department of
the Air Force, Department of the Navy, Army Corps of Engineers, General
Services Administration, NTIS and the Department of Energy began
development of a new online system designed to consolidate the best
practices of agencies operating under the MOU program. The work group
also looked at adding non-standard wage determinations to the online
system. Principal objectives of the work group were the elimination of
the paper Form SF-98 and the availability of wage determinations
electronically.
At the same time, the WHD was developing an electronic request and
response system to replace Form SF-98. The WHD began live tests of the
e98 system in FY 2003. During FY 2003, the WHD received and responded
to more than 12,000 e98 submissions. A computer responds to a
significant number of the e98 requests immediately while the requester
is online. The remaining requests are referred to an analyst and the
response is usually sent later the same day or the next day. For all
requests, the e98 system is designed to track individual requests by
the procurement dates listed on the request, and when a wage
determination that would affect a particular procurement is revised, an
amended email response is sent to the contracting agency.
The site developed by the WDOL work group integrates the e98
process with the best practices developed under the MOU program. WDOL
offers users a number of unique features in a web-based environment.
The site includes: (1) guidance to contracting officers on selecting
the appropriate wage determination for each contract action; (2) access
to the most current SCA and DBA wage determinations, as well as an
alert service for notification of future revisions to particular wage
determinations; and, (3) access to databases containing archived wage
determinations under both the SCA and DBA.
To facilitate contracting officers selecting the appropriate SCA
wage determination, the WDOL site leads the requester through a
``decision tree'' consisting of a series of questions. Based upon the
responses to these questions, the WDOL site will either identify an SCA
wage determination or direct the requester to submit an e98. A link to
the e98 site is provided. In addition, the WDOL site gives the
requester the option of going directly to the e98 site without having
to go through the ``decision tree'' selection process. If a contracting
officer has any question regarding the selection of the proper SCA wage
determination, the WDOL site directs the contracting officer to the
e98.
As clearly indicated on the WDOL Web site, compliance with the
decision tree selection process and the guidance provided by the User's
Guide does not relieve the contracting officer or other program user of
the requirement to carefully review the contract or solicitation, the
FAR and its Supplements, other Federal agency acquisition regulations
or the DOL regulations related to these actions. If the DOL discovers
and determines, whether before or after contract award, that the
correct SCA wage determination was not included in a covered contract,
the contracting officer, within 30 days of notification by the DOL, is
required to include in the contract the applicable wage determination
issued by the DOL. (See 29 CFR 4.5(c)(2).)
III. Summary of Comments
DOL received five comments in response to the Notice of Proposed
Rulemaking, discussed further below, from the: Office of the Under
Secretary of Defense (DOD); Army Corps of Engineers (Army); Department
of the Navy, Office of the Assistant Secretary for Research,
Development and Acquisition (Navy); Contract Services Association
(CSA); and International Association of Machinists and Aerospace
Workers. All comments generally support the automated environment for
obtaining wage determinations that underlies the proposed rule;
however, several comments recommend minor revisions. Some of the
recommendations address issues that are beyond the scope of the
proposed rule.
The CSA urges removing the references in proposed Sec. Sec. 1.2(e)
and 4.1a(i) that ``the term WDOL will apply to any other Internet Web
site or electronic means that the Department of Labor may approve for
these purposes,'' in addition to http://www.wdol.gov. The CSA believes
the definition may cause potential confusion among contractors and
contracting agencies. These sections define the term, ``WDOL.'' The
proposed rule allows more flexibility and accommodates future
technological advances without the delays that might otherwise be
associated with procedural regulatory changes. The final rule retains
the references.
The Navy urges revising or eliminating the current requirement in
Sec. 1.4 for contracting agencies to provide the DOL with an annual
summary of their construction plans for the coming year. The final rule
retains the requirement. The Navy believes much of the information
provided in these
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reports could be extracted from various reports used for other
purposes. These construction reports are not related to the process for
obtaining wage determinations and are not part of the proposed rule. In
the past, the WHD has used these reports to identify localities with
the greatest need for new Davis-Bacon wage surveys. Although the WHD is
testing new processes that might allow regularly scheduled Davis-Bacon
wage surveys of all areas of the country, it is not yet clear that such
processes will totally eliminate the need for some targeted surveys. In
addition, it is not clear that the other sources identified by the Navy
would provide the same level of detail and information as called for
under Sec. 1.4 of the Regulations. The DOL does not believe that
further action on this recommendation is warranted at this time and
that the suggestion would necessitate reopening the notice and comment
process. The DOL will give careful consideration to the Navy's
recommendation, if it undertakes further rulemaking regarding the
Davis-Bacon Act in the future.
The DOD and Navy recommend replacing the detailed discussion in
Sec. 1.5(b) regarding the requirements for completing Form SF-308 with
a more general statement and provide for an electronic submission
option. The final rule retains the existing provision, because the DOL
does not believe providing Federal agencies with an electronic
submission option for the rare instances in which an agency files Form
SF-308 justifies the considerable expense that developing such a system
would require. The DOL processed fewer than 100 Forms SF-308 in FY
2004.
The CSA recommends amending the definition of ``wage
determination'' in Sec. 4.1a(h) to clarify the effective date and
applicability of wage determinations. This definition is not part of
the proposed regulatory changes. The Administrative Procedure Act
(APA), 5 U.S.C. 553, normally requires notice and an opportunity for
public comment when an agency amends a substantive rule. The APA,
however, contains exceptions to the notice and comment provisions for
(1) ``interpretive rules, general statements of policy, or rules of
agency organization, procedure, or practice'' and (2) rules where the
agency for good cause finds that notice and public comment are
``impracticable, unnecessary, or contrary to the public interest.''
Agencies may immediately adopt rules subject to the exceptions. The
suggested change regarding the date on which a wage determination
becomes effective, without including a reference to the applicability
of the determination, helps to clarify the WDOL process and augments
Sec. 4.4(c)(1) of the proposed rule. The section makes clear that a
contracting agency using the WDOL process bears full responsibility for
selecting the correct wage determination. The rule, however, also
requires the contracting agency to amend a contract if the DOL
subsequently determines the contracting agency applied an incorrect
wage determination to a specific contract; thus, an inapplicable wage
determination does not become applicable because the contracting agency
has inserted it into the contracting action. The final rule
incorporates the suggestion to include when a wage determination
becomes effective by adding a new sentence to the existing definition
for wage determination in Sec. 4.1a(h) to read, ``A wage determination
is effective upon its publication on the WDOL website or when a Federal
agency receives a response from the Department of Labor to an e98.''
The DOL hereby finds, pursuant to 5 U.S.C. 553(b)(3)(B), that notice
and public comment procedures on this clarification of the definition
of ``wage determination'' in Sec. 4.1a(h) are impracticable and
unnecessary and would not further the public interest.
The DOD and Navy want the definition for the term, ``e98,'' in
Sec. 4.1a(j) to include the Internet address for WDOL. The agencies
believe such a change would help clarify how to locate the e98. The DOL
agrees this could improve access to the e98. The final rule includes
the Web site.
The CSA believes proposed Sec. 4.3(c) requires minor clarification
by adding the word, ``revision,'' to the discussion of methods by which
an existing wage determination may become obsolete in the last
sentence. The CSA points out that the remainder of the section
discusses ``revisions'' of wage determinations. The DOL agrees the
change may help in understanding the requirement, and the final rule
incorporates this change. The CSA also recommends relocating the
proposed description in Sec. 4.3(c) of what a wage determination
includes and its significance to the definitions found in Sec. 4.1a.
The final rule retains the description in its present location, because
the DOL believes the overall discussion of wage determinations in Sec.
4.3 remains a more appropriate context for information found in a wage
determination and its significance.
The CSA also urges revising proposed Sec. 4.3(e) to (1) make all
effective SCA wage determinations and any underlying collective
bargaining agreements and locality wage determinations available for
public inspection at all WHD District Offices and (2) clarify the
availability of archived wage determinations through WDOL. The proposed
regulation provides for the DOL to make wage determinations available
for public inspection through the National and five Regional Offices of
the WHD during regular business hours and through WDOL. The proposed
WDOL rule parallels the ``public inspection'' provisions that exist in
the current rule geared for review of only paper documents and, adds an
on-line viewing feature available through WDOL. The final rule does not
provide for public inspection of wage determinations at WHD District
Offices but does highlight the availability of archived copies of wage
determinations through WDOL. WHD District Offices are not staffed in a
way that would allow public inspections of wage determinations in the
District Offices. In addition, the proposed change would require the
agency to either maintain a supply of printed copies of all wage
determinations available or a computer available for public use at each
District Office. Adoption of the recommendation would impose a
regulatory requirement to make staff available and print copies of all
wage determinations in each District Office and could impose a new
demand for resources not presently available. Persons in outlying areas
may access wage determinations through the Internet and facilities to
access the Internet are available at public libraries. Availability of
a DOL computer for public inspection could also present potential
security concerns for DOL's information technology systems. The WDOL
website does have a capability to allow the viewing of archival copies
of wage determinations that are not current, and the final rule makes
that availability clear. The DOL has also incorporated this suggestion
in Sec. 1.6(c)(3)(v), with respect to Davis-Bacon wage determinations.
The DOL has received several suggestions regarding Sec. 4.4,
Obtaining a wage determination. The CSA urges inserting ``applicable,''
when referring to wage determinations in effect for a particular
contracting action in Sec. 4.4(a). The CSA wants this change since the
FAR SCA price adjustment clause uses ``applicable'' to describe the
basis for changing pricing when a new wage determination takes effect,
tribunals use ``applicable'' when determining which wage determination
is appropriate for price adjustment, and DOL uses the term for
enforcement purposes. The final rule does not include the reference.
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The DOL believes the proposed regulation sufficiently outlines the
relevant applicable requirements and the reasons for not adopting a
similar suggestion discussed in relation to Sec. 4.1a(h) also apply to
this situation.
The CSA also suggests adding the issuance of any task order issued
pursuant to a GSA Schedule contract or blanket purchase agreement for
commercial services to the illustrative list of contracting actions for
which a contracting agency must obtain a wage determination in Sec.
4.4(a)(1). The CSA believes adding the reference may be prudent, given
the continuing growth of GSA Schedule and commercial service
contracting. The final rule does not add the example. The DOL believes
naming GSA schedule contracts and blanket purchase agreements may cause
some confusion, because no individual task or purchase order determines
the amount of the contract. The existing provisions of Sec. 4.142
provides guidance by stating these contracts would ordinarily
constitute contracts within the intent of the Act under judicially
established principles.
A third CSA recommendation encourages adding a statement in Sec.
4.4(a)(3)(i) highlighting that a contracting agency may select a wage
determination through WDOL, in addition to obtaining it from DOL. The
final rule does not include the additional statement. The proposed rule
requires a contracting agency to obtain a wage determination for each
location in which work may be performed, if the place of performance is
unknown at the time of solicitation. In addition to the e98 process,
contracting agencies may obtain wage determinations from DOL through
WDOL. Section 4.4 (a)(2) provides a general discussion of the methods
and Sec. 4.4(b) and (c) provide specific discussions of the different
ways in which a contracting agency may obtain a wage determination. In
a related recommendation, the CSA suggests removing the provision in
this section that requires use of the wage determination incorporated
in the contract documents. The CSA believes the wage determinations
apply to service employees in specific localities, not to contractors.
The CSA also presents a view that, when a contractor relocates work,
contracting agencies should use the WDOL or e98 process to obtain a new
wage determination for the location in which the work performance
actually takes place. The final rule retains the provision. The DOL
does not believe that further action on this recommendation is
warranted at this time and it would necessitate reopening the notice
and comment process.
The DOD and Navy recommend revising Sec. 4.4(b)(1) to have WDOL
use the applicable solicitation or contract number for tracking
purposes, instead of the WDOL system assigning a unique number. The
final rule does not incorporate this recommendation, because it would
require redesign of the WDOL system and how it interfaces with internal
DOL programs, as well as considerable additional resources that are
presently not available.
The DOD and Navy also recommend changing the proposed requirement
in Sec. 4.4(b)(3) for a contracting agency to monitor email addresses
to having contracting agencies resubmit an e98 with a new email address
each time an email address changes. These agencies also believe the DOL
should establish an internal policy of requesting electronic delivery
and read receipts. The final rule retains the monitoring requirement
and does not establish a policy of requesting electronic delivery and
read receipts. The proposed rule makes clear that contracting agencies
obtaining wage determinations through WDOL bear the responsibility for
insuring they incorporate the correct wage determination into any
contracting action. The rule also provides flexibility to contracting
agencies in how they accomplish that standard. The ``email monitoring
provision'' of proposed Sec. 4.4(b)(3) is similar to the proposed
Sec. 4.4(c)(3) requirement for contracting agencies to monitor the
WDOL website to determine whether the applicable wage determination has
been revised. There may also be situations, such as periods of leave
(e.g., 2-week vacation), during which contracting agencies may not
believe it practical to update email addresses; thus, to require
resubmission of an e98 in all cases could be unduly burdensome. The
WDOL website provides a method for contracting agencies to contact the
Division. The DOL believes the WDOL contact process is sufficient.
The DOD and Navy recommend replacing the phrase ``geographic area''
in Sec. Sec. 4.4(b)(5) and (c)(4) with ``locality,'' to make the
wording consistent with Sec. 4.163(i). The DOL agrees and the final
rule reflects the modification.
The DOD and Navy also seek to revise Sec. 4.4(b)(5) and 4.5(d) to
have the contracting officer follow up with the DOL, if the contracting
agency has not received a response within 10 business days of the
submission of the original e98 notice or within 15 business days of the
submission of the collective bargaining agreement. They further suggest
the regulation specify an email address and a telephone number where
such follow up should be made. The DOL has not adopted the suggested
changes in the final rule. Proposed Sec. 4.4(b)(1) provides for the
requester to receive a response indicating the request has been
referred to an analyst, if the DOL does not provide a final response to
an e98 while the requester is online. The e98 will be assigned a unique
serial number to facilitate follow-up should that become necessary.
Although the regulations do not provide specific timeframes for a
further response by an analyst, the initial e98 response states that a
further response will be provided within five days. The additional
response is usually provided on the same day or the next day; however
some cases may require additional time. When the DOL requires
additional time or information, the analyst working on the request will
provide an interim reply informing the requestor of the need and that
further response will come from the email address of the analyst
working on the e98 request. If the contracting officer needs to follow-
up on his/her e98, it would be more efficient to address such follow-up
directly to the analyst working on the e98. In those rare instances
where the contracting officer does not receive at least an interim
response from an analyst within five days of submission, the
instructions for the e98 provide both an email address and a telephone
number where requests for assistance or a status report may be sent.
The DOL believes including telephone numbers and email addresses in the
regulations is not the most efficient way to ensure contracting
officers have access to the current address and telephone number,
because such information may change. The DOL also believes contracting
officers accustomed to using the internet for submitting e98s will most
likely return to the e98 website, rather than turn to the DOL
regulations to seek an email address or telephone number to follow-up
on their e98 submission. The DOL believes that these matters are
adequately addressed within the e98 system and the proposed
regulations.
The CSA recommends adding a reference to the ``changes'' clause in
an SCA contract to the requirement in Sec. 4.4(c)(1) for contracting
agencies to amend contracts by incorporating the correct wage
determination as determined by DOL. The CSA believes the change is
appropriate, because the proposed regulations (1) affect Federal agency
procurement procedures and (2) are for contracting agencies. The final
rule does not contain such a provision. The DOL believes the proposed
rule adequately states the obligations contracting agencies have when a
[[Page 50892]]
contracting agency incorporates an incorrect wage determination and
that the FAR is the appropriate vehicle to address the concern raised
by the CSA.
The CSA suggests the DOL refer to ``information,'' instead of
``document,'' in Sec. 4.5(a)(1), and the final rule reflects this
recommendation. The CSA believes the change would make the regulation
more consistent with the purpose of the regulation, to take advantage
of wide use of electronic communication and information sharing. The
types of ``documents'' contemplated by the proposed rule are the wage
determination, including revisions received timely, for the contracting
action. The DOL believes contracting agencies currently routinely use
paper copies of wage determinations for insertion into contracting
actions; however, the proposed rule would not preclude use of
electronic documents. DOL, however, believes the more common use of
``documents'' as referring to paper and the broader use of
``information'' and ``data'' for information technology purposes make a
sufficiently compelling case to adopt the suggestion.
The CSA urges the DOL to divide Sec. 4.5(a)(2) into a general
introductory statement and two subsections pertaining to special
circumstances. The final rule incorporates this recommendation, because
the DOL agrees this may increase understanding of the regulatory
requirements. The CSA also recommends the DOL reduce the 10-day time
frame discussed in the second sentence of Sec. 4.5(a)(2). The CSA
believes a 5-day period would still allow contracting agencies time to
provide electronic notification to offerors of the amended solicitation
and still allow offerors sufficient time to amend their proposals. The
final rule does not include this second change. The current and
proposed rule allow agencies to make a determination that there is not
a reasonable time to notify bidders of a revised wage determination, if
the agency receives notice of the revision less than 10 days before the
bid opening. The DOL believes use of electronic communication may cause
contracting agencies to have fewer instances in which they will make a
finding of insufficient time; however, it remains appropriate for
contracting agencies to have an ability to exercise this discretion
based on varying factual circumstances. The CSA further seeks to change
this section by (1) making any revised wage determinations received
after final proposal revisions inapplicable to negotiated procurements
and (2) adding a provision requiring contracting agencies to make
modifications within half the time currently allowed and (3) requiring
corresponding adjustment in the contract price. The final rule does not
include the requested changes, because they exceed the intended scope
of the proposed rule, and the DOL believes further action on this
recommendation would require reopening the notice and comment process.
The DOD and Navy suggest removal of the fourth sentence of this
proposed section, as initially drafted, which provides that, if (1) the
contract does not specify a start of performance date which is within
30 days from the award and/or (2) performance of such procurement does
not commence within this 30-day period, the DOL shall be notified and
any notice of a revision received by the agency not less than 10 days
before commencement of the contract shall be effective. The agencies
believe on-line access to wage determinations through WDOL and the e98
process make it unnecessary to continue the requirement for contracting
agencies to submit blanket notifications to the DOL for all contracts
specifying a start of performance date of more than 30 days, originally
developed under the paper Form SF-98 process. The final rule does not
include the notification requirement, but the remainder of the
requirement has been retained.
The CSA urges that Sec. 4.5(a)(3) highlight that a contracting
agency has received an initial or a revised wage determination on the
date the DOL (1) posts the determination to the WDOL Web site or (2)
sends the determination through the e98 response process. The CSA
believes it is critical to emphasize that a wage determination becomes
effective when published on the WDOL Web site, and not only when the
contracting agency receives an e98 response from DOL, since proposed
Sec. 4.4, Obtaining a wage determination, addresses identification of
the initial wage determination (whether by the WDOL or e98 process).
The final rule now includes references to the initial wage
determination and e98 process in Sec. 4.5(a)(3). The proposed rule
only mentions the date of publication on WDOL or date on which an
agency receives a revised determination from the DOL; however, the
proposed rule does not indicate that contracting agencies may also
receive initial wage determinations through the e98 process. The DOL
agrees the clarification proposed by the CSA could reduce confusion
over the date of receipt and make it more congruous with Sec. 4.4.
The CSA recommends revising Sec. 4.5(c) by referring to an
``applicable'' wage determination, changing the time frame for
inserting the appropriate wage determination from 30 to 15 days from
the date of the DOL notification and incorporating a reference to the
changes clause of the contract. The final rule does not adopt these
changes, for reasons previously explained.
The DOD and Navy recommend Sec. 4.5(d) direct the contracting
officer to incorporate a complete copy of the collective bargaining
agreement into the contract action, if a timely response to the e98 has
not been received and the e98 involves a collective bargaining
agreement. The final rule does not include this prescription, because
it may not be the most efficient approach in all cases and the existing
proposal provides adequate guidance and greater flexibility in
addressing the underlying concern. Proposed Sec. 4.5(d) provides that
the WHD should be contacted for guidance in cases where the contracting
agency has filed an e98 and has not received a response. While it is
possible that the guidance will be to include the entire collective
bargaining agreement in the contract action, such action may not be
necessary in all cases.
The DOD, Army and Navy also express a belief that the Sec. 4.8
requirement regarding use of Form SF-99 (Notice of Award of Contract)
is no longer needed and its continuation creates an unnecessary
duplication of contract reporting, in view of the enhanced reporting
capabilities of the Federal Procurement Data System (FPDS). The
agencies ask the DOL to eliminate the reporting requirement. The
proposed rule does not include any changes in Sec. 4.8 or this
reporting requirement. The SCA coverage threshold for application of
SCA wage determinations is $2,500; however, Sec. 4.8 of the current
rule requires that when a contract over $10,000 is awarded and the
agency does not report the award to the FPDS via Form SF-279 (FPDS
Individual Contract Action Report) or its equivalent, the agency is
expected to furnish a Form SF-99 to the Wage and Hour Division unless
it makes other arrangements for notifying the Division of such awards.
The $10,000 reporting threshold was adopted in the SCA rules in 1983 to
be consistent with the then-applicable small purchase threshold and
reporting requirements of the FPDS. Prior to 1983, a Form SF-99 was
required for all SCA contracts in excess of S2,500. This procedural
rule, thus, originally established a reporting requirement between a
federal contracting agency and the DOL only if the contract award data
was not already being reported to the FPDS, thereby eliminating any
duplication of reporting requirements and reducing existing
[[Page 50893]]
paperwork and reporting burdens on the agencies. The FPDS reporting
threshold via Form SF-279, however, has since been increased to
$25,000. The change in the FPDS reporting threshold, thus, has created
the additional reporting burden. In any event, in the interest of
eliminating any unanticipated paperwork and reporting burdens imposed
by Sec. 4.8, the DOL has decided to discontinue the use of Standard
Form 99 and eliminate the reporting requirement entirely. The APA
exception to the notice-and-comment procedures applies to this
situation. The DOL finds, pursuant to 5 U.S.C. 553(b)(3)(B), that
notice and public comment procedures on this procedural reporting rule
are impracticable and unnecessary and would not further the public
interest. Accordingly, the final rule removes and reserves Sec. 4.8
and the DOL will discontinue using Form SF-99.
The CSA suggests removal of Sec. 4.50(a)(2), in the absence of any
correlation between the provision and the wide use of electronic
communication and information sharing, or moving the discussion to
Sec. 4.56, Review and reconsideration of wage determinations. The
final rule retains this provision as proposed without change. The
section stresses that (1) various prevailing wage determinations may
apply in a particular locality and (2) the application of these
different prevailing wage determinations will depend upon the nature of
the contracts to which they are applied. These differences and
variations in wage determinations require that contracting agencies
observe the proper protocol required by the WDOL processes when
selecting the appropriate wage determination. The provisions of Sec.
4.56 provide an appeal right for any interested party affected by a
wage determination to request the Wage and Hour Administrator to review
and reconsider it.
The CSA also urges revising the last sentence of Sec. 4.54(b), to
provide for the issuance of wage determinations for various localities
identified by the contracting agency as set forth in Sec. 4.4(a)(3)(i)
``using the e98 process or 4.4(c) using the WDOL process.'' The final
rule does not adopt the suggested change. Section 4.54 discusses
situations where services are to be performed for a Federal agency at
the site of the successful bidder, in contrast to services to be
performed at a specific Federal facility or installation, or in the
locality of such installation. The location where the work will be
performed often cannot be ascertained at the time of bid advertisement
or solicitation. The Sec. 4.4(a) introductory discussion of obtaining
wage determinations applies equally to wage determinations obtained
through either the e98 or WDOL processes, respectively explained in
Sec. 4.4 (b) and (c).
The CSA recommends inserting a requirement in Sec. 4.55(a) for the
WHD to review wage determinations no less often than once every two
years and also seeks other changes, consistent with the recommendation
for Sec. 4.54. The final rule does not include these changes. The
current and proposed regulations require periodic review of wage
determinations but do not impose the maximum two-year interval between
such reviews. The general requirement in SCA section 4(d) for the
periodic update of wage determinations directs the contracting agencies
to update wage determinations in awarded multi-year contracts. It is
not a directive to DOL to update its wage determination database no
less often than every two years. The DOL has not made these remaining
changes, for the reasons discussed.
The CSA recommends adding a reference to the ``changes'' clause in
an SCA contract to Sec. 4.144(c)(1), pertaining to contract
modifications affecting the amount of a contract. The final rule does
not add the reference for the reasons previously stated. The proposed
section merely conforms the provision to the e98 process and reflects
the current regulation in all other respects.
The CSA makes a general recommendation to substitute ``website''
for ``Internet Web site'' and to remove quotation marks from e98. The
final rule incorporates these plain language changes. The final rule
does not adopt the CSA recommendation to replace ``Government'' with
``Department of Labor,'' because the DOL does not host the WDOL Web
site.
IV. Regulatory Flexibility, Executive Order 12866; Small Business
Regulatory Enforcement Fairness Act
This regulation affects Federal agency procurement procedures and
will not have a significant economic impact on a substantial number of
small entities within the meaning of the Regulatory Flexibility Act, 5
U.S.C. 601 et seq. The agency certified to this effect to the Chief
Counsel for Advocacy of the U.S. Small Business Administration.
This rule has been treated as a significant rulemaking, although
not economically significant or major, and has, therefore, been
reviewed by OMB.
V. Unfunded Mandates Reform Act
For purposes of the Unfunded Mandates Reform Act of 1995, 2 U.S.C.
1532, this rule does not include any Federal mandate that may result in
excess of $100 million in expenditures by state, local and tribal
governments in the aggregate or by the private sector.
VI. Executive Order 13132 (Federalism)
The rule does not have federalism implications as outlined in
Executive Order 13132. The rule does not have substantial direct
effects on the States, on the relationship between the national
government and the States, or on the distribution of power and
responsibilities among the various levels of government.
VII. Executive Order 13175, Indian Tribal Governments
This rule does not have ``tribal implications'' under Executive
Order 13175 and does not require a tribal summary impact statement. The
rule does not have ``substantial direct effects on one or more Indian
tribes, on the relationship between the Federal government and Indian
tribes or on the distribution of power and responsibilities between the
Federal government and Indian tribes.''
VIII. Effects on Families
The undersigned hereby certifies that the rule will not adversely
affect the well-being of families, as discussed under section 654 of
the Treasury and General Government Appropriations Act, 1999.
IX. Executive Order 13045, Protection of Children
This rule has no environmental health risk or safety risk that may
disproportionately affect children.
X. Environmental Impact Assessment
A review of this rule in accordance with the requirements of the
National Environmental Policy Act of 1969 (NEPA), 42 U.S.C. 4321 et
seq.; the regulations of the Council on Environmental Quality, 40 CFR
1500 et seq.; and the Departmental NEPA procedures, 29 CFR part 11,
indicates the rule will not have a significant impact on the quality of
the human environment. There is, thus, no corresponding environmental
assessment or an environmental impact statement.
XI. Executive Order 13211, Energy Supply
This rule is not subject to Executive Order 13211. It will not have
a significant adverse effect on the supply, distribution or use of
energy.
[[Page 50894]]
XII. Executive Order 12630, Constitutionally Protected Property Rights
This rule is not subject to Executive Order 12630, because it does
not involve implementation of a policy ``that has takings
implications'' or that could impose limitations on private property
use.
XIII. Executive Order 12988, Civil Justice Reform Analysis
This rule was drafted and reviewed in accordance with Executive
Order 12988 and will not unduly burden the Federal court system. The
rule was: (1) Reviewed to eliminate drafting errors and ambiguities;
(2) written to minimize litigation; and (3) written to provide a clear
legal standard for affected conduct and to promote burden reduction.
List of Subjects
29 CFR Part 1
Administrative practice and procedure, Government contracts,
Investigations, Labor, Minimum wages, Recordkeeping requirements,
Reporting requirements, Wages.
29 CFR Part 4
Administrative practice and procedure, Government contracts,
Investigations, Labor, Minimum wages, Penalties, Recordkeeping
requirements, Reporting requirements, Wages.
Signed at Washington, DC, this 18th day of August, 2005.
Victoria A. Lipnic,
Assistant Secretary for Employment Standards.
Alfred B. Robinson, Jr.,
Deputy Administrator, Wage and Hour Division.
0
For the reasons set forth above, title 29, parts 1 and 4, of the Code
of Federal Regulations are amended as set forth below.
TITLE 29--LABOR
PART 1--PROCEDURES FOR PREDETERMINATION OF WAGE RATES
0
1. The authority citation for part 1 is revised to read as follows:
Authority: 5 U.S.C. 301; R.S. 161, 64 Stat. 1267; Reorganization
Plan No. 14 of 1950, 5 U.S.C. appendix; 40 U.S.C. 3141 et seq.; 40
U.S.C. 3145; 40 U.S.C. 3148; and the laws listed in appendix A of
this part.
0
2. Paragraph (e) is added to section 1.2 to read as follows:
Sec. 1.2 Definitions.\1\
* * * * *
(e) The term Wage Determinations OnLine (WDOL) shall mean the
Government Internet Web site for both Davis-Bacon Act and Service
Contract Act wage determinations available at http://www.wdol.gov. In
addition, WDOL provides compliance assistance information. The term
will also apply to any other Internet Web site or electronic means that
the Department of Labor may approve for these purposes.
0
3. Paragraphs (a) and (b) of Sec. 1.5 are revised to read as follows:
Sec. 1.5 Procedure for requesting wage determinations.
(a) The Department of Labor publishes general wage determinations
under the Davis-Bacon Act on the WDOL Internet Web site. If there is a
general wage determination applicable to the project, the agency may
use it without notifying the Department of Labor, Provided, That
questions concerning its use shall be referred to the Department of
Labor in accordance with Sec. 1.6(b).
(b)(1) If a general wage determination is not available, the
Federal agency shall request a wage determination under the Davis-Bacon
Act or any of its related prevailing wage statutes by submitting Form
SF-308 to the Department of Labor at this address: U.S. Department of
Labor, Employment Standards Administration, Wage and Hour Division,
Branch of Construction Contract Wage Determination, Washington, DC
20210. In preparing Form SF-308, the agency shall check only those
classifications that will be needed in the performance of the work.
Inserting a note such as ``entire schedule'' or ``all applicable
classifications'' is not sufficient. Additional classifications needed
that are not on the form may be typed in the blank spaces or on a
separate list and attached to the form.
(2) In completing SF-308, the agency shall furnish:
(i) A sufficiently detailed description of the work to indicate the
type of construction involved. Additional description or separate
attachment, if necessary for identification of type of project, shall
be furnished.
(ii) The county (or other civil subdivision) and State in which the
proposed project is located.
(3) Such request for a wage determination shall be accompanied by
any pertinent wage payment information that may be available. When the
requesting agency is a State highway department under the Federal-Aid
Highway Acts as codified in 23 U.S.C. 113, such agency shall also
include its recommendations as to the wages which are prevailing for
each classification of laborers and mechanics on similar construction
in the area.
* * * * *
0
4. Paragraphs (a)(2), (c)(3)(iv) and (c)(3)(v) of Sec. 1.6 are revised
to read as follows:
Sec. 1.6 Use and effectiveness of wage determinations.
(a) * * *
(2) General wage determinations issued pursuant to Sec. 1.5(a),
notice of which is published on WDOL, shall contain no expiration date.
* * * * *
(c) * * *
(3) * * *
(iv) If under paragraph (c)(3)(i) of this section the contract has
not been awarded within 90 days after bid opening, or if under
paragraph (c)(3)(ii) or (iii) of this section construction has not
begun within 90 days after initial endorsement or the signing of the
agreement to enter into a housing assistance payments contract, any
modification, notice of which is published on WDOL prior to award of
the contract or the beginning of construction, as appropriate, shall be
effective with respect to that contract unless the head of the agency
or his or her designee requests and obtains an extension of the 90-day
period from the Administrator. Such request shall be supported by a
written finding, which shall include a brief statement of the factual
support, that the extension is necessary and proper in the public
interest to prevent injustice or undue hardship or to avoid serious
impairment in the conduct of Government business. The Administrator
will either grant or deny the request for an extension after
consideration of all the circumstances.
(v) A modification to a general wage determination is ``published''
within the meaning of this section on the date notice of a modification
or a supersedeas wage determination is published on WDOL or on the date
the agency receives actual written notice of the modification from the
Department of Labor, whichever occurs first. Archived versions of
Davis-Bacon and Related Acts wage determinations that are no longer
current may be accessed in the ``Archived DB WD'' database of WDOL for
information purposes only. Contracting officers should not use an
archived wage determination in a contract action without prior approval
of the Department of Labor.
* * * * *
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5. Items 19 and 20 in Appendix A of part 1 are revised to read as
follows:
Appendix A to Part 1
* * * * *
[[Page 50895]]
19. National Visitors Center Facilities Act of 1968 (sec. 110,
82 Stat. 45; 40 U.S.C. 808).
Note: Section applying labor standards provisions of the Davis-
Bacon Act repealed August 21, 2002, by 116 Stat. 1318, Pub. L. 107-
217.
20. Appalachian Regional Development Act of 1965 (sec. 402, 79
Stat. 21; 40 U.S.C. 14701).
* * * * *
0
6. Appendix B of Part 1 is revised to read as follows:
Appendix B to Part 1
Northeast Region
For the States of Connecticut, Delaware, District of Columbia,
Maine, Maryland, Massachusetts, New Hampshire, New Jersey, New York,
Pennsylvania, Puerto Rico, Rhode Island, Vermont, Virgin Islands,
Virginia and West Virginia:
Regional Administrator, Wage and Hour Division, Employment
Standards Administration, U.S. Department of Labor, Curtis Center,
170 South Independence Mall West, Room 850 West, Philadelphia, PA
19106 (Telephone: 215-861-5800, FAX: 215-861-5840).
Southeast Region
For the States of Alabama, Florida, Georgia, Kentucky,
Mississippi, North Carolina, South Carolina and Tennessee:
Regional Administrator, Wage and Hour Division, Employment
Standards Administration, U.S. Department of Labor, 61 Forsyth
Street, SW., Room 7M40, Atlanta, GA 30303 (Telephone 404-893-4531,
FAX: 404-893-4524).
Midwest Region
For the States of Illinois, Indiana, Iowa, Kansas, Michigan,
Minnesota, Missouri, Nebraska, Ohio and Wisconsin:
Regional Administrator, Wage and Hour Division, Employment
Standards Administration, U.S. Department of Labor, 230 South
Dearborn Street, Room 530, Chicago, IL 60604-1591 (Telephone: 312-
596-7180, FAX: 312-596-7205).
Southwest Region
For the States of Arkansas, Colorado, Louisiana, Montana, New
Mexico, North Dakota, Oklahoma, South Dakota, Texas, Utah and
Wyoming:
Regional Administrator, Wage and Hour Division, Employment
Standards Administration, U.S. Department of Labor, 525 South
Griffin Street, Suite 800, Dallas, TX 75202-5007 (Telephone: 972-
850-2600, FAX: 972-850-2601).
Western Region
For the States of Alaska, American Samoa, Arizona, California,
Guam, Hawaii, Idaho, Nevada, Oregon and Washington:
Regional Administrator, Wage and Hour Division, Employment
Standards Administration, U.S. Department of Labor, 71 Stevenson
Street, Suite 930, San Francisco, CA 94105, (Telephone: 415-848-
6600, FAX: 415-848-6655).
0
7. Appendix C of part 1 is deleted.
PART 4--LABOR STANDARDS FOR FEDERAL SERVICE CONTRACTS
0
8. The authority citation for part 4 continues to read as follows:
Authority: 41 U.S.C. 351 et seq.; 41 U.S.C. 38 and 39; 5 U.S.C.
301.
Subpart A--Service Contract Labor Standards Provisions and
Procedures
0
9. In Sec. 4.1a, paragraphs (b) and (h) are revised and paragraphs (i)
and (j) are added, to read as follows:
Sec. 4.1a Definitions and use of terms.
(b) Secretary includes the Secretary of Labor, the Assistant
Secretary for Employment Standards, and their authorized
representatives.
* * * * *
(h) Wage determination includes any determination of minimum wage
rates or fringe benefits made pursuant to the provisions of sections
2(a) and/or 4(c) of the Act for application to the employment in a
locality of any class or classes of service employees in the
performance of any contract in excess of $2,500 which is subject to the
provisions of the Service Contract Act of 1965. A wage determination is
effective upon its publication on the WDOL Web site or when a Federal
agency receives a response from the Department of Labor to an e98.
(i) Wage Determinations OnLine (WDOL) means the Government Internet
Web site for both Davis-Bacon Act and Service Contract Act wage
determinations available at http://www.wdol.gov. In addition, WDOL
provides compliance assistance information and a link to submit an e98
or any electronic means the Department of Labor may approve for this
purpose. The term will also apply to any other Internet Web site or
electronic means that the Department of Labor may approve for these
purposes.
(j) The e98 means a Department of Labor approved electronic
application (http://www.wdol.gov), whereby a contracting officer
submits pertinent information to the Department of Labor and requests a
wage determination directly from the Wage and Hour Division. The term
will also apply to any other process or system the Department of Labor
may establish for this purpose.
0
10. In Sec. 4.3, paragraphs (b) through (d) are revised and paragraph
(e) is added, to read as follows:
Sec. 4.3 Wage determinations.
* * * * *
(b) As described in subpart B of this part--Wage Determination
Procedures, two types of wage determinations are issued under the Act:
Prevailing in the locality or Collective Bargaining Agreement
(Successorship) wage determinations. The facts related to a specific
solicitation and contract will determine the type of wage determination
applicable to that procurement. In addition, different types of
prevailing wage determinations may be issued depending upon the nature
of the contract. While prevailing wage determinations based upon cross-
industry survey data are applicable to most contracts covered by the
Act, in some cases the Department of Labor may issue industry specific
wage determinations for application to specific types of service
contracts. In addition, the geographic scope of contracts is often
different and the geographic scope of the underlying survey data for
the wage determinations applicable to those contracts may be different.
(c) Such wage determinations will set forth for the various classes
of service employees to be employed in furnishing services under such
contracts in the appropriate localities, minimum monetary wage rates to
be paid and minimum fringe benefits to be furnished them during the
periods when they are engaged in the performance of such contracts,
including, where appropriate under the Act, provisions for adjustments
in such minimum rates and benefits to be placed in effect under such
contracts at specified future times. The wage rates and fringe benefits
set forth in such wage determinations shall be determined in accordance
with the provisions of sections 2(a)(1), (2), and (5), 4(c) and 4(d) of
the Act from those prevailing in the locality for such employees, with
due consideration of the rates that would be paid for direct Federal
employment of any classes of such employees whose wages, if Federally
employed, would be determined as provided in 5 U.S.C. 5341 or 5 U.S.C.
5332, or from pertinent collective bargaining agreements with respect
to the implementation of section 4(c). The wage rates and fringe
benefits so determined for any class of service employees to be engaged
in furnishing covered contract services in a locality shall be made
applicable by contract to all service employees of such class employed
to perform such services in the locality under any contract subject to
section 2(a) of the Act which is entered into thereafter and before
such determination has been rendered obsolete by a withdrawal,
modification, revision, or supersedure.
(d) Generally, wage determinations issued for solicitations or
negotiations for any contract where the place of
[[Page 50896]]
performance is unknown will contain minimum monetary wages and fringe
benefits for the various geographic localities where the work may be
performed which were identified in the initial solicitation. (See Sec.
4.4(a)(3)(i).)
(e) Wage determinations will be available for public inspection
during business hours at the Wage and Hour Division, Employment
Standards Administration, U.S. Department of Labor, Washington, DC, and
copies will be made available on request at Regional Offices of the
Wage and Hour Division. In addition, most prevailing wage
determinations are available online from WDOL. Archived versions of SCA
wage determinations that are no longer current may be accessed in the
``Archived SCA WD'' database of WDOL for information purposes only.
Contracting officers should not use an archived wage determination in a
contract action without prior approval of the Department of Labor.
0
11. Section 4.4 is revised to read as follows:
Sec. 4.4 Obtaining a wage determination.
(a)(1) Sections 2(a)(1) and (2) of the Act require that every
contract and any bid specification therefore in excess of $2,500
contain a wage determination specifying the minimum monetary wages and
fringe benefits to be paid to service employees performing work on the
contract. The contracting agency, therefore, must obtain a wage
determination prior to:
(i) Any invitation for bids;
(ii) Request for proposals;
(iii) Commencement of negotiations;
(iv) Exercise of option or contract extension;
(v) Annual anniversary date of a multi-year contract subject to
annual fiscal appropriations of the Congress; or
(vi) Each biennial anniversary date of a multi-year contract not
subject to such annual appropriations, if so authorized by the Wage and
Hour Division.
(2) As described in Sec. 4.4(b), wage determinations may be
obtained from the Department of Labor by electronically submitting an
e98 describing the proposed contract and the occupations expected to be
employed on the contract. Based upon the information provided on the
e98, the Department of Labor will respond with the wage determination
or wage determinations that the contracting agency may rely upon as the
correct wage determination(s) for the contract described in the e98.
Alternatively, contracting agencies may select and obtain a wage
determination using WDOL. (See Sec. 4.4(c).) Although the WDOL Web
site provides assistance to the agency to select the correct wage
determination for the contract, the agency remains responsible for the
wage determination selected.
(3)(i) Where the place of performance of a contract for services
subject to the Act is unknown at the time of solicitation, the
solicitation need not initially contain a wage determination. The
contracting agency, upon identification of firms participating in the
procurement in response to an initial solicitation, shall obtain a wage
determination for each location where the work may be performed as
indicated by participating firms. An applicable wage determination must
be obtained for each firm participating in the bidding for the location
in which it would perform the contract. The appropriate wage
determination shall be incorporated in the resultant contract documents
and shall be applicable to all work performed thereunder (regardless of
whether the successful contractor subsequently changes the place(s) of
contract performance).
(ii) There may be unusual situations, as determined by the
Department of Labor upon consultation with a contracting agency, where
the procedure in paragraph (a)(3)(i) of this section is not practicable
in a particular situation. In these situations, the Department may
authorize a modified procedure that may result in the subsequent
issuance of wage determinations for one or more composite localities.
(4) In no event may a contract subject to the Act on which more
than five (5) service employees are contemplated to be employed be
awarded without an appropriate wage determination. (See section 10 of
the Act.)
(b) e98 process--
(1) The e98 is an electronic application used by contracting
agencies to request wage determinations directly from the Wage and Hour
Division. The Division uses computers to analyze information provided
on the e98 and to provide a response while the requester is online, if
the analysis determines that an existing wage determination is
currently applicable to the procurement. The response will assign a
unique serial number to the e98 and the response will provide a link to
an electronic copy of the applicable wage determination(s). If the
initial computer analysis cannot identify the applicable wage
determination for the request, an online response will be provided
indicating that the request has been referred to an analyst. Again, the
online response will assign a unique serial number to the e98. After an
analyst has reviewed the request, a further response will be sent to
the email address identified on the e98. In most cases, the further
response will provide an attachment with a copy of the applicable wage
determination(s). In some cases, however, additional information may be
required and the additional information will be requested via email.
After an applicable wage determination is sent in response to an e98,
the e98 system continues to monitor the request and if the applicable
wage determination is revised in time to affect the procurement, an
amended response will be sent to the email address identified on the
e98.
(2) When completing an e98, it is important that all information
requested be completed accurately and fully. However, several sections
are particularly important. Since most responses are provided via
email, a correct email address is critically important. Accurate
procurement dates are essential for the follow-up response system to
operate effectively. An accurate estimate of the number of service
employees to be employed under the contract is also important because
section 10 of the Act requires that a wage determination be issued for
all contracts that involve more than five service employees.
(3) Since the e98 system automatically provides an amended response
if the applicable wage determination is revised, the email address
listed on the e98 must be monitored during the full solicitation stage
of the procurement. Communications sent to the email address provided
are deemed to be received by the contracting agency. A contracting
agency must update the email address through the ``help'' process
identified on the e98, if the agency no longer intends to monitor the
email address.
(4) For invitations to bid, if the bid opening date is delayed by
more than sixty (60) days, or if contract commencement is delayed by
more than sixty (60) days for all other contract actions, the
contracting agency shall submit a revised e98.
(5) If the services to be furnished under the proposed contract
will be substantially the same as services being furnished in the same
locality by an incumbent contractor whose contract the proposed
contract will succeed, and if such incumbent contractor is furnishing
such services through the use of service employees whose wage rates and
fringe benefits are the subject of one or more collective bargaining
agreements, the contracting agency shall reference the union and the
collective bargaining agreement on the e98. The requester will receive
an e-mail response giving instructions for
[[Page 50897]]
submitting a copy of each such collective bargaining agreement together
with any related documents specifying the wage rates and fringe
benefits currently or prospectively payable under such agreement. After
receipt of the collective bargaining agreement, the Wage and Hour
Division will provide a further e-mail response attaching a copy of the
wage determination based upon the collective bargaining agreement. If
the place of contract performance is unknown, the contracting agency
will submit the collective bargaining agreement of the incumbent
contractor for incorporation into a wage determination applicable to a
potential bidder located in the same locality as the predecessor
contractor. If such services are being furnished at more than one
locality and the collectively bargained wage rates and fringe benefits
are different at different localities or do not apply to one or more
localities, the agency shall identify the localities to which such
agreements have application. If the collective bargaining agreement
does not apply to all service employees under the contract, the agency
shall identify the employees and/or work subject to the collective
bargaining agreement. In the event the agency has reason to believe
that any such collective bargaining agreement was not entered into as a
result of arm's-length negotiations, a full statement of the facts so
indicating shall be transmitted with the copy of such agreement. (See
Sec. 4.11.) If the agency has information indicating that any such
collectively bargained wage rates and fringe benefits are substantially
at variance with those prevailing for services of a similar character
in the locality, the agency shall so advise the Wage and Hour Division
and, if it believes a hearing thereon pursuant to section 4(c) of the
Act is warranted, shall file its request for such hearing pursuant to
Sec. 4.10 at the time of filing the e98.
(6) If the proposed contract is for a multi-year period subject to
other than annual appropriations, the contracting agency shall provide
a statement in the comments section of the e98 concerning the type of
funding and the contemplated term of the proposed contract. Unless
otherwise advised by the Wage and Hour Division that a wage
determination must be obtained on the annual anniversary date, a new
wage determination shall be obtained on each biennial anniversary date
of the proposed multi-year contract in the event its term is for a
period in excess of two years.
(c) WDOL process--
(1) Contracting agencies may use the WDOL Web site to select the
applicable prevailing wage determination for the procurement. The WDOL
site provides assistance to the agency in the selection of the correct
wage determination. The contracting agency, however, is fully
responsible for selecting the correct wage determination. If the
Department of Labor subsequently determines that an incorrect wage
determination was applied to a specific contract, the contracting
agency, in accordance with Sec. 4.5, shall amend the contract to
incorporate the correct wage determination as determined by the
Department of Labor.
(2) If an applicable prevailing wage determination is not available
on the WDOL site, the contracting agency must submit an e98 in
accordance with Sec. 4.4(b).
(3) The contracting agency shall monitor the WDOL site to determine
whether the applicable wage determination has been revised. Revisions
published on the WDOL site or otherwise communicated to the contracting
officer within the timeframes prescribed in Sec. 4.5(a)(2) are
applicable and must be included in the resulting contract.
(4) If the services to be furnished under the proposed contract
will be substantially the same as services being furnished in the same
locality by an incumbent contractor whose contract the proposed
contract will succeed, and if such incumbent contractor is furnishing
such services through the use of service employees whose wage rates and
fringe benefits are the subject of one or more collective bargaining
agreements, the contracting agency may prepare a wage determination
that references the collective bargaining agreement by incorporating
that wage determination, with a complete copy of the collective
bargaining agreement attached thereto, into the successor contract
action. It need not submit a copy of the collective bargaining
agreement to the Department of Labor unless requested to do so. If the
place of contract performance is unknown, the contracting agency will
prepare a wage determination on WDOL and attach the collective
bargaining agreement of the incumbent contractor and make both the wage
determination and collective bargaining agreement applicable to a
potential bidder located in the same locality as the predecessor
contractor. (See section 4.4(a)(3).) If such services are being
furnished at more than one locality and the collectively bargained wage
rates and fringe benefits are different at different localities or do
not apply to one or more localities, the agency shall identify the
localities to which such agreements have application. If the collective
bargaining agreement does not apply to all service employees under the
contract, the agency shall identify the employees and/or work subject
to the collective bargaining agreement. In the event the agency has
reason to believe that any such collective bargaining agreement was not
entered into as a result of arm's-length negotiations, a full statement
of the facts so indicating shall be transmitted to the Wage and Hour
Division with the copy of such agreement. (See Sec. 4.11.) If the
agency has information indicating that any such collectively bargained
wage rates and fringe benefits are substantially at variance with those
prevailing for services of a similar character in the locality, the
agency shall so advise the Wage and Hour Division and, if it believes a
hearing thereon pursuant to section 4(c) of the Act is warranted, shall
file its request for such hearing pursuant to Sec. 4.10. A wage
determination based upon the collective bargaining agreement must be
included in the contract until a hearing or a final ruling of the
Administrator determines that the collective bargaining agreement was
not reached as the result of arm's-length negotiations or was
substantially at variance with locally prevailing rates. Any questions
regarding timeliness or applicability of collective bargaining
agreements must be referred to the Department of Labor for resolution.
(5) If the proposed contract is for a multi-year period subject to
other than annual appropriations, the contracting agency shall, unless
otherwise advised by the Wage and Hour Division, obtain a new wage
determination on each biennial anniversary date of the proposed multi-
year contract in the event its term is for a period in excess of two
years.
0
12. Section 4.5 is amended by revising paragraphs (a), (c), and (d) to
read as follows:
Sec. 4.5 Contract specification of determined minimum wages and
fringe benefits.
(a) Any contract in excess of $2,500 shall contain, as an
attachment, the applicable, currently effective wage determination
specifying the minimum wages and fringe benefits for service employees
to be employed thereunder, including any information referred to in
paragraphs (a)(1) or (2) of this section;
(1) Any wage determination from the Wage and Hour Division,
Employment Standards Administration, Department of Labor, responsive to
the contracting agency's submission of an e98 or obtained through WDOL
under Sec. 4.4; or
[[Page 50898]]
(2) Any revision of a wage determination issued prior to the award
of the contract or contracts which specifies minimum wage rates or
fringe benefits for classes of service employees whose wages or fringe
benefits were not previously covered by wage determinations, or which
changes previously determined minimum wage rates and fringe benefits
for service employees employed on covered contracts in the locality.
(i) However, revisions received by the Federal agency later than 10
days before the opening of bids, in the case of contracts entered into
pursuant to competitive bidding procedures, shall not be effective if
the Federal agency finds that there is not a reasonable time still
available to notify bidders of the revision.
(ii) In the case of procurements entered into pursuant to
negotiations (or in the case of the execution of an option or an
extension of the initial contract term), revisions received by the
agency after award (or execution of an option or extension of term, as
the case may be) of the contract shall not be effective provided that
the contract start of performance is within 30 days of such award (or
execution of an option or extension of term). Any notice of a revision
received by the agency not less than 10 days before commencement of the
contract shall be effective, if:
(A) The contract does not specify a start of performance date which
is within 30 days from the award; and/or
(B) Performance of such procurement does not commence within this
30-day period.
(iii) In situations arising under section 4(c) of the Act, the
provisions in Sec. 4.1b(b) apply.
(3) For purposes of using WDOL databases containing prevailing wage
determinations, the date of receipt by the contracting agency will be
the date of publication on the WDOL Web site or on the date the agency
receives actual notice of an initial or revised wage determination from
the Department of Labor through the e98 process, whichever occurs
first.
* * * * *
(c) Where the Department of Labor discovers and determines, whether
before or subsequent to a contract award, that a contracting agency
made an erroneous determination that the Service Contract Act did not
apply to a particular procurement and/or failed to include an
appropriate wage determination in a covered contract, the contracting
agency, within 30 days of notification by the Department of Labor,
shall include in the contract the stipulations contained in Sec. 4.6
and any applicable wage determination issued by the Administrator or
his authorized representative through the exercise of any and all
authority that may be needed (including, where necessary, its authority
to negotiate or amend, its authority to pay any necessary additional
costs, and its authority under any contract provision authorizing
changes, cancellation, and termination). With respect to any contract
subject to section 10 of the Act, the Administrator may require
retroactive application of such wage determination. (See 53 Comp. Gen.
412, (1973); Curtiss-Wright Corp. v. McLucas, 381 F. Supp. 657 (D NJ
1974); Marine Engineers Beneficial Assn., District 2 v. Military
Sealift Command, 86 CCH Labor Cases ]33,782 (D DC 1979); Brinks, Inc.
v. Board of Governors of the Federal Reserve System, 466 F. Supp. 112
(D DC 1979), 466 F. Supp. 116 (D DC 1979).) (See also 32 CFR 1-403.)
(d) In cases where the contracting agency has filed an e98 and has
not received a response from the Department of Labor, the contracting
agency shall, with respect to any contract for which section 10 to the
Act and Sec. 4.3 for this part mandate the inclusion of an applicable
wage determination, contact the Wage and Hour Division by e-mail or
telephone for guidance.
Sec. 4.8 [Removed and Reserved]
0
13. Section 4.8 is removed and reserved.
Subpart B--Wage Determination Procedures
0
14. Section 4.50 is revised to read as follows:
Sec. 4.50 Types of wage and fringe benefit determinations.
The Administrator specifies the minimum monetary wages and fringe
benefits to be paid as required under the Act in two types of
determinations:
(a) Prevailing in the locality. (1) Determinations that set forth
minimum monetary wages and fringe benefits determined to be prevailing
for various classes of service employees in the locality (sections
2(a)(1) and 2(a)(2) of the Act) after giving ``due consideration'' to
the rates applicable to such service employees if directly hired by the
Federal Government (section 2(a)(5) of the Act).
(2) The prevailing wage determinations applicable to most contracts
covered by the Act are based upon cross-industry survey data. However,
in some cases the Department of Labor may issue industry specific wage
determinations for application to specific types of service contracts.
In addition, the geographic scope of contracts is often different and
the geographic scope of the underlying survey data for the wage
determinations applicable to those contracts may be different.
Therefore, a variety of different prevailing wage determinations may be
applicable in a particular locality. The application of these different
prevailing wage determinations will depend upon the nature of the
contracts to which they are applied.
(b) Collective Bargaining Agreement--(Successorship).
Determinations that set forth the wage rates and fringe benefits,
including accrued and prospective increases, contained in a collective
bargaining agreement applicable to the service employees who performed
on a predecessor contract in the same locality. (See sections 2(a)(1)
and (2) as well as 4(c) of the Act.)
0
15. Paragraph (b) of Sec. 4.54 is revised to read as follows:
Sec. 4.54 Locality basis of wage and fringe benefit determinations.
* * * * *
(b) Where the services are to be performed for a Federal agency at
the site of the successful bidder, in contrast to services to be
performed at a specific Federal facility or installation, or in the
locality of such installation, the location where the work will be
performed often cannot be ascertained at the time of bid advertisement
or solicitation. In such instances, wage determinations will generally
be issued for the various localities identified by the agency as set
forth in Sec. 4.4(a)(3)(i).
* * * * *
0
16. Paragraphs (a) and (b) of Sec. 4.55 are revised to read as
follows:
Sec. 4.55 Issuance and revision of wage determinations.
(a) Determinations will be reviewed periodically and where
prevailing wage rates or fringe benefits have changed, such changes
will be reflected in revised determinations. For example, in a locality
where it is determined that the wage rate which prevails for a
particular class of service employees is the rate specified in a
collective bargaining agreement(s) applicable in that locality, and
such agreement(s) specifies increases in such rates to be effective on
specific dates, the determinations would be revised to reflect such
changes as they become effective. Revised determinations shall be
applicable to contracts in accordance with the provisions of Sec.
4.5(a) of subpart A.
[[Page 50899]]
(b) Determinations issued by the Wage and Hour Division with
respect to particular contracts are required to be incorporated in the
invitations for bids or requests for proposals or quotations issued by
the contracting agencies, and are to be incorporated in the contract
specifications in accordance with Sec. 4.5 of subpart A. In this
manner, prospective contractors and subcontractors are advised of the
minimum monetary wages and fringe benefits required under the most
recently applicable determination to be paid the service employees who
perform the contract work. These requirements are the same for all
bidders so none will be placed at a competitive disadvantage.
* * * * *
Subpart C--Application of the McNamara-O'Hara Service Contract Act
0
17. Paragraphs (e)(1)(iv)(A) and (e)(2)(iii)(A) of Sec. 4.123 are
revised to read as follows:
Sec. 4.123 Administrative limitations, variances, tolerances and
exemptions.
* * * * *
(e) * * *
(1) * * *
(iv)(A) If the Administrator determines after award of the prime
contract that any of the requirements in paragraph (e)(1) of this
section for exemption has not been met, the exemption will be deemed
inapplicable, and the contract shall become subject to the Service
Contract Act, effective as of the date of the Administrator's
determination. In such case, the corrective procedures in Sec. 4.5(c)
shall be followed.
* * * * *
(2) * * *
(iii)(A) If the Administrator determines after award of the prime
contract that any of the requirements in paragraph (e)(2) of this
section for exemption has not been met, the exemption will be deemed
inapplicable, and the contract shall become subject to the Service
Contract Act. In such case, the corrective procedures in Sec. 4.5(c)
shall be followed.
* * * * *
0
18. Section 4.144 is revised to read as follows:
Sec. 4.144 Contract modifications affecting amount.
Where a contract that was originally issued in an amount not in
excess of $2,500 is later modified so that its amount may exceed that
figure, all the provisions of section 2(a) of the Act, and the
regulations thereunder, are applicable from the date of modification to
the date of contract completion. In the event of such modification, the
contracting officer shall immediately obtain a wage determination from
the Department of Labor using the e98 application or directly from
WDOL, and insert the required contract clauses and any wage
determination issued into the contract. In the event that a contract
for services subject to the Act in excess of $2,500 is modified so that
it cannot exceed $2,500, compliance with the provisions of section 2(a)
of the Act and the contract clauses required thereunder ceases to be an
obligation of the contractor when such modification becomes effective.
[FR Doc. 05-16779 Filed 8-25-05; 8:45 am]
BILLING CODE 4510-27-P
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