22.404-2 General requirements
Source: FAR 22.404-2 on acquisition.gov
Contracting officers must ensure only the correct, current, and clearly designated wage determinations are included in construction contracts, with proper classification and guidance sought when needed.
Overview
FAR 22.404-2 outlines the general requirements for contracting officers regarding the incorporation and application of wage determinations in construction contracts subject to the Construction Wage Rate Requirements statute (formerly Davis-Bacon Act). It specifies how wage determinations must be selected, applied, and documented in solicitations and contracts, ensuring that only the appropriate and current wage rates are used for the relevant types of construction work. The section also provides definitions and guidelines for classifying construction projects (building, residential, highway, heavy) and emphasizes the importance of adhering to local area practices and seeking guidance when classification is unclear.
Key Rules
- Appropriate Wage Determinations
- Only relevant wage determinations must be included in contracts, and each must be clearly designated to the applicable work. Project wage determinations cannot be used for unrelated contracts or options.
- Current Wage Determinations for Options
- When exercising contract options, the most current wage determinations from the same schedule must be used.
- Rate Schedule Inclusion
- For contracts with multiple rate schedules, only applicable schedules should be included, or the entire determination with clear indications of applicability. Inclusion by reference is not allowed.
- Construction Type Classification
- Provides definitions for building, residential, highway, and heavy construction to guide proper wage schedule selection.
- Unclear Project Classification
- When project type is unclear, local area practices should be considered, and guidance from the Wage and Hour Division should be sought before bid opening or final offers.
Responsibilities
- Contracting Officers: Must select, incorporate, and clearly designate appropriate wage determinations and schedules; update wage determinations for options; seek guidance when classification is unclear.
- Contractors: Must comply with the wage determinations and schedules specified in the contract.
- Agencies: Ensure oversight of proper wage determination application and compliance with Department of Labor guidance.
Practical Implications
- Ensures workers are paid correct prevailing wages for the type of construction work performed.
- Reduces risk of disputes or noncompliance by clarifying wage determination selection and application.
- Common pitfalls include misclassification of construction type, failure to update wage determinations for options, or improper inclusion by reference.
(a) The contracting officer must incorporate only the appropriate wage determinations in solicitations and contracts and must designate the work to which each determination or part thereof applies. The contracting officer must not include project wage determinations in contracts or options other than those for which they are issued. When exercising an option to extend the term of a contract, the contracting officer must select the most current wage determination(s) from the same schedule(s) as the wage determination(s) incorporated into the contract.
(b) If the wage determination is a general wage determination or a project wage determination containing more than one rate schedule, the contracting officer shall either include only the rate schedules that apply to the particular types of construction (building, heavy, highway, etc.) or include the entire wage determination and clearly indicate the parts of the work to which each rate schedule shall be applied. Inclusion by reference is not permitted.
(c) The Wage and Hour Division has issued the following general guidelines for use in selecting the proper schedule(s) of wage rates:
(1) Building construction is generally the construction of sheltered enclosures with walk-in access, for housing persons, machinery, equipment, or supplies. It typically includes all construction of such structures, installation of utilities and equipment (both above and below grade level), as well as incidental grading, utilities and paving, unless there is an established area practice to the contrary.
(2) Residential construction is generally the construction, alteration, or repair of single family houses or apartment buildings of no more than four (4) stories in height, and typically includes incidental items such as site work, parking areas, utilities, streets and sidewalks, unless there is an established area practice to the contrary.
(3) Highwayconstruction is generally the construction, alteration, or repair of roads, streets, highways, runways, taxiways, alleys, parking areas, and other similar projects that are not incidental to "building," "residential," or "heavy" construction.
(4) Heavy construction includes those projects that are not properly classified as either "building," "residential," or "highway," and is of a catch-all nature. Such heavy projects may sometimes be distinguished on the basis of their individual characteristics, and separate schedules issued (e.g.,"dredging," "water and sewer line," "dams," "flood control," etc.).
(5) When the nature of a project is not clear, it is necessary to look at additional factors, with primary consideration given to locally established area practices. If there is any doubt as to the proper application of wage rate schedules to the type or types of construction involved, guidance shall be sought before the opening of bids, or receipt of best and final offers, from the Administrator, Wage and Hour Division. Further examples are contained in Department of Labor All Agency Memoranda Numbers 130 and 131.