22.1016
Statement of equivalent rates for Federal hires
Contracting officers must provide a statement of equivalent federal wage rates and fringe benefits for service employees, calculated using specified federal pay schedules, to ensure transparency and compliance with labor standards.
Overview
FAR 22.1016 outlines the requirements for preparing a "Statement of Equivalent Rates for Federal Hires" as mandated by the clause at 52.222-42. This statement is used in service contracts subject to the Service Contract Labor Standards to inform contractors of the wage rates and fringe benefits that would be paid to service employees if they were federal employees under the General Schedule (white collar) or Wage Board (blue collar) pay systems. The section details how to calculate these equivalent rates and where to obtain necessary data.
Key Rules
- Statement Requirement
- Contracting activities must provide a statement listing equivalent federal wage rates and fringe benefits for service employees expected to work under the contract.
- Computation Procedures
- Blue collar rates: Use Wage Board pay schedule step two for nonsupervisory and step three for supervisory employees.
- White collar rates: Divide the General Schedule step one biweekly rate by 80 to get the hourly rate.
- Data Assistance
- Local civilian personnel offices can help determine appropriate grades and salary data.
Responsibilities
- Contracting Officers: Must prepare and include the statement of equivalent rates in applicable solicitations and contracts, using the specified computation methods.
- Contractors: Should review the statement to understand wage expectations and ensure compliance with labor standards.
- Agencies: Must ensure accurate and current wage data is used and provide support through personnel offices.
Practical Implications
- This requirement ensures transparency and fairness in wage determinations for service contracts, helping contractors align pay with federal standards. Failure to provide accurate statements can lead to compliance issues or disputes. Contractors should use the statement as a reference point for wage and benefit planning.