52.222-7 Withholding of Funds
Source: FAR 52.222-7 on acquisition.gov
Contracting Officers can withhold payments from contractors to ensure laborers and mechanics are paid required prevailing wages, and may suspend payments if wage violations are not corrected.
Overview
FAR 52.222-7, "Withholding of Funds," establishes the authority and procedures for Contracting Officers to withhold payments from contractors when there is a failure to pay laborers and mechanics the wages required by the contract, as mandated by prevailing wage laws. This clause applies to contracts subject to prevailing wage requirements, such as those under the Davis-Bacon Act. The Contracting Officer can act independently or upon request from the Department of Labor to withhold sufficient funds to cover unpaid wages. If violations occur, the Contracting Officer may suspend further payments or advances until the contractor remedies the wage deficiencies. Written notice must be provided to the contractor before such actions are taken.
As prescribed in 22.407(a), insert the following clause:
Withholding of Funds (May 2014)
The Contracting Officer shall, upon his or her own action or upon written request of an authorized representative of the Department of Labor, withhold or cause to be withheld from the Contractor under this contract or any other Federal contract with the same Prime Contractor, or any other federally assisted contract subject to prevailing wage requirements, which is held by the same Prime Contractor, so much of the accrued payments or advances as may be considered necessary to pay laborers and mechanics, including apprentices, trainees, and helpers, employed by the Contractor or any subcontractor the full amount of wages required by the contract. In the event of failure to pay any laborer or mechanic, including any apprentice, trainee, or helper, employed or working on the site of the work, all or part of the wages required by the contract, the Contracting Officer may, after written notice to the Contractor, take such action as may be necessary to cause the suspension of any further payment, advance, or guarantee of funds until such violations have ceased.
(End of clause)