Fair Labor Standards Act and Service Contract Labor Standards-Price Adjustment (Multiple Year and Option Contracts)
FAR 52.222-43 allows contract price adjustments for actual wage and fringe benefit changes due to updated wage determinations or minimum wage laws, but only if contractors follow strict notification and documentation requirements.
Overview
FAR 52.222-43 establishes the requirements for price adjustments in multiple year and option contracts subject to the Fair Labor Standards Act (FLSA) and Service Contract Labor Standards (SCLS). This clause ensures that contractors are compensated for actual increases or decreases in wages and fringe benefits resulting from updated Department of Labor wage determinations or changes in federal minimum wage laws. It applies to contracts with area prevailing wage determinations and those under collective bargaining agreements. The clause prohibits contractors from including contingencies for such increases in their original pricing and limits adjustments to direct wage and benefit changes, excluding overhead or profit. Contractors must notify the Contracting Officer of any claimed increases within 30 days of receiving a new wage determination and provide supporting documentation. The government retains audit rights for three years after final payment.