52.222-30 Construction Wage Rate Requirements-Price Adjustment (None or Separately Specified Method)
Source: FAR 52.222-30 on acquisition.gov
When an option to extend a construction contract is exercised, the current wage determination applies, but no automatic price adjustment is made for wage changes unless the contract specifically provides for it.
Overview
- This clause addresses how wage determinations under the Construction Wage Rate Requirements (formerly Davis-Bacon Act) are handled when an option to extend a construction contract is exercised. It clarifies that the wage determination effective at the time of the option will apply to the option period, but no contract price adjustment will be made for wage or benefit changes unless otherwise specified in the contract.
Key Rules
- Application of Wage Determination for Option Periods
- The wage determination in effect at the time the government exercises an option to extend the contract will govern wages and benefits for that option period.
- No Automatic Price Adjustment
- The contract price will not be adjusted for increases or decreases in wages and benefits due to new or revised wage determinations, unless another contract clause provides for such an adjustment.
- Other Wage Determination Changes
- No price adjustment will be made for wage changes resulting from operation of law or other requirements under the Construction Wage Rate Requirements statute, unless specified elsewhere in the contract.
Responsibilities
- Contracting Officers: Must ensure the correct wage determination is incorporated for each option period and clarify any price adjustment provisions elsewhere in the contract.
- Contractors: Must comply with the applicable wage determination for each period and cannot expect automatic price adjustments for wage increases or decreases unless specified.
- Agencies: Must oversee compliance with wage determinations and contract terms regarding price adjustments.
Practical Implications
- This clause prevents contractors from claiming additional compensation solely due to wage determination changes when an option is exercised, unless the contract specifically allows it. Contractors should carefully review contract terms for any price adjustment provisions and plan accordingly for potential wage changes during option periods. Failure to understand this could result in unanticipated costs or disputes.
As prescribed in 22.407(e), insert the following clause:
Construction Wage Rate Requirements-Price Adjustment (None or Separately Specified Method) (Aug 2018)
(a) The wage determination issued under the Construction Wage Rate Requirements statute by the Administrator, Wage and Hour Division, U.S. Department of Labor, that is effective for an option to extend the term of the contract, will apply to that option period.
(b) The Contracting Officer will make no adjustment in contract price, other than provided for elsewhere in this contract, to cover any increases or decreases in wages and benefits as a result of-
(1) Incorporation of the Department of Labor’s wage determination applicable at the exercise of the option to extend the term of the contract;
(2) Incorporation of a wage determination otherwise applied to the contract by operation of law; or
(3) An increase in wages and benefits resulting from any other requirement applicable to workers subject to the Construction Wage Rate Requirements statute.
(End of clause)