52.222-41
Service Contract Labor Standards
FAR 52.222-41 requires contractors on covered federal service contracts to pay service employees prevailing wages and benefits, maintain strict records, and ensure compliance with Department of Labor standards to avoid penalties and contract risks.
Overview
FAR 52.222-41, Service Contract Labor Standards, establishes minimum wage, fringe benefit, and working condition requirements for service employees performing on federal service contracts. The clause implements the Service Contract Labor Standards statute (formerly the Service Contract Act), ensuring that contractors and subcontractors pay service employees no less than the prevailing wage rates and benefits determined by the Department of Labor (DOL) for the locality and type of work performed. It also sets forth procedures for classifying unlisted job categories, recordkeeping, notification, and compliance obligations.
Key Rules
- Wage and Fringe Benefit Requirements
- Contractors must pay service employees at least the minimum wages and provide fringe benefits as specified in the applicable DOL wage determination attached to the contract.
- Classification of Unlisted Employees
- If a required job classification is not listed, contractors must submit SF 1444 to request a conformance and pay the determined rate retroactively.
- Recordkeeping and Reporting
- Contractors must maintain detailed payroll and employment records for three years and make them available for DOL inspection.
- Notification and Posting
- Contractors must notify employees of wage/fringe benefit requirements or post the wage determination and DOL poster at the worksite.
- Subcontractor Flowdown
- The clause must be included in all covered subcontracts.
- Withholding and Remedies
- The government may withhold payments or terminate the contract for noncompliance, and resolve disputes per DOL procedures.
Responsibilities
- Contracting Officers: Ensure inclusion of the clause, review and process SF 1444s, withhold payments for violations, and enforce compliance.
- Contractors: Pay required wages/benefits, classify employees properly, maintain records, notify/post, and flow down the clause to subs.
- Agencies: Oversee compliance, coordinate with DOL, and enforce remedies for violations.
Practical Implications
- This clause protects service employees from substandard wages and benefits on federal contracts.
- Contractors must be diligent in wage determinations, recordkeeping, and compliance to avoid payment withholdings, penalties, or contract termination.
- Common pitfalls include misclassification, late or incomplete recordkeeping, and failure to notify employees or flow down requirements to subs.