Subpart 22.4 - Labor Standards for Contracts

Involving Construction

Parent topic: Part 22 - Application of Labor Laws to Government Acquisitions

22.400 Scope of subpart.

This subpart implements the statutes which prescribe labor standards requirements for contracts in

excess of $2,000 for construction, alteration, or repair, including painting and decorating, of public

buildings and public works. (See definition of "Construction, alteration, or repair" in section 22.401.)

Labor relations requirements prescribed in other subparts of part 22 may also apply.

22.401 Definitions.

As used in this subpartApprentice means a person-

(1) Employed and individually registered in a bona fide apprenticeship program registered with the

U.S. Department of Labor, Employment and Training Administration, Office of Apprenticeship

Training, Employer, and Labor Services (OATELS), or with a State Apprenticeship Agency

recognized by OATELS; or

(2) Who is in the first 90 days of probationary employment as an apprentice in an apprenticeship

program, and is not individually registered in the program, but who has been certified by the

OATELS or a State Apprenticeship Agency (where appropriate) to be eligible for probationary

employment as an apprentice.

Construction, alteration, or repair means all types of work done by laborers and mechanics

employed by the construction contractor or construction subcontractor on a particular building or

work at the site thereof, including without limitations-

(1) Altering, remodeling, installation (if appropriate) on the site of the work of items fabricated offsite;

(2) Painting and decorating;

(3) Manufacturing or furnishing of materials, articles, supplies, or equipment on the site of the

building or work;

(4) Transportation of materials and supplies between the site of the work within the meaning of

paragraphs (1)(i) and (ii) of the "site of the work" definition of this section, and a facility which is

dedicated to the construction of the building or work and is deemed part of the site of the work

within the meaning of paragraph (2) of the "site of work" definition of this section; and

(5) Transportation of portions of the building or work between a secondary site where a significant

portion of the building or work is constructed, which is part of the "site of the work" definition in
paragraph (1)(ii) of this section, and the physical place or places where the building or work will

remain (paragraph (1)(i) in the "site of the work" definition of this section).

Laborers or mechanics.-

(1) Means-

(i) Workers, utilized by a contractor or subcontractor at any tier, whose duties are manual or

physical in nature (including those workers who use tools or who are performing the work of a

trade), as distinguished from mental or managerial;

(ii) Apprentices, trainees, helpers, and, in the case of contracts subject to the Contract Work Hours

and Safety Standards statute, watchmen and guards;

(iii) Working foremen who devote more than 20 percent of their time during a workweek performing

duties of a laborer or mechanic, and who do not meet the criteria of 29 CFR part 541, for the time so

spent; and

(iv) Every person performing the duties of a laborer or mechanic, regardless of any contractual

relationship alleged to exist between the contractor and those individuals; and

(2) Does not include workers whose duties are primarily executive, supervisory (except as provided

in paragraph (1)(iii) of this definition), administrative, or clerical, rather than manual. Persons

employed in a bona fide executive, administrative, or professional capacity as defined in 29 CFR part

541 are not deemed to be laborers or mechanics.

Public building or public work means building or work, the construction, prosecution, completion, or

repair of which, as defined in this section, is carried on directly by authority of, or with funds of, a

Federal agency to serve the interest of the general public regardless of whether title thereof is in a

Federal agency.

Site of the work.-

(1) Means

(i) The primary site of the work. The physical place or places where the construction called for in the

contract will remain when work on it is completed; and

(ii) The secondary site of the work, if any. Any other site where a significant portion of the building

or work is constructed, provided that such site is-

(A) Located in the United States; and

(B) Established specifically for the performance of the contract or project;

(2) Except as provided in paragraph (3) of this definition, includes fabrication plants, mobile

factories, batch plants, borrow pits, job headquarters, tool yards, etc., provided-

(i) They are dedicated exclusively, or nearly so, to performance of the contract or project; and

(ii) They are adjacent or virtually adjacent to the "primary site of the work" as defined in paragraphs

(1)(i) of "the secondary site of the work" as defined in paragraph (1)(ii) of this definition;

(3) Does not include permanent home offices, branch plant establishments, fabrication plants, or tool
yards of a contractor or subcontractor whose locations and continuance in operation are determined

wholly without regard to a particular Federal contract or project. In addition, fabrication plants,

batch plants, borrow pits, job headquarters, yards, etc., of a commercial or material supplier which

are established by a supplier of materials for the project before opening of bids and not on the

project site, are not included in the "site of the work." Such permanent, previously established

facilities are not a part of the "site of the work", even if the operations for a period of time may be

dedicated exclusively, or nearly so, to the performance of a contract.

Trainee means a person registered and receiving on-thejob training in a construction occupation

under a program which has been approved in advance by the U.S. Department of Labor,

Employment and Training Administration, Office of Apprenticeship Training, Employer, and Labor

Services (OATELS), as meeting its standards for on-the-job training programs and which has been so

certified by that Administration.

Wages means the basic hourly rate of pay; any contribution irrevocably made by a contractor or

subcontractor to a trustee or to a third person pursuant to a bona fide fringe benefit fund, plan, or

program; and the rate of costs to the contractor or subcontractor which may be reasonably

anticipated in providing bonafide fringe benefits to laborers and mechanics pursuant to an

enforceable commitment to carry out a financially responsible plan or program, which was

communicated in writing to the laborers and mechanics affected. The fringe benefits enumerated in

the Construction Wage Rate Requirements statute include medical or hospital care, pensions on

retirement or death, compensation for injuries or illness resulting from occupational activity, or

insurance to provide any of the foregoing; unemployment benefits; life insurance, disability

insurance, sickness insurance, or accident insurance; vacation or holiday pay; defraying costs of

apprenticeship or other similar programs; or other bona fide fringe benefits. Fringe benefits do not

include benefits required by other Federal, State, or local law.

22.402 Applicability.

(a) Contracts for construction work.

(1) The requirements of this subpart apply-

(i) Only if the construction work is, or reasonably can be foreseen to be, performed at a particular

site so that wage rates can be determined for the locality, and only to construction work that is

performed by laborers and mechanics at the site of the work;

(ii) To dismantling, demolition, or removal of improvements if a part of the construction contract, or

if construction at that site is anticipated by another contract as provided in subpart 37.3;

(iii) To the manufacture or fabrication of construction materials and components conducted in

connection with the construction and on the site of the work by the contractor or a subcontractor

under a contract otherwise subject to this subpart; and

(iv) To painting of public buildings or public works, whether performed in connection with the

original construction or as alteration or repair of an existing structure.

(2) The requirements of this subpart do not apply to-

(i) The manufacturing of components or materials off the site of the work or their subsequent
delivery to the site by the commercial supplier or materialman;

(ii) Contracts requiring construction work that is so closely related to research, experiment, and

development that it cannot be performed separately, or that is itself the subject of research,

experiment, or development (see paragraph (b) of this section for applicability of this subpart to

research and development contracts or portions thereof involving construction, alteration, or repair

of a public building or public work);

(iii) Employees of railroads operating under collective bargaining agreements that are subject to the

Railway Labor Act; or

(iv) Employees who work at contractors’ or subcontractors’ permanent home offices, fabrication

shops, or tool yards not located at the site of the work. However, if the employees go to the site of

the work and perform construction activities there, the requirements of this subpart are applicable

for the actual time so spent, not including travel unless the employees transport materials or

supplies to or from the site of the work.

(b) Nonconstruction contracts involving some construction work.

(1) The requirements of this subpart apply to construction work to be performed as part of

nonconstruction contracts (supply, service, research and development, etc.) if-

(i) The construction work is to be performed on a public building or public work;

(ii) The contract contains specific requirements for a substantial amount of construction work

exceeding the monetary threshold for application of the Construction Wage Rate Requirements

statute (the word "substantial" relates to the type and quantity of construction work to be performed

and not merely to the total value of construction work as compared to the total value of the

contract); and

(iii) The construction work is physically or functionally separate from, and is capable of being

performed on a segregated basis from, the other work required by the contract.

(2) The requirements of this subpart do not apply if-

(i) The construction work is incidental to the furnishing of supplies, equipment, or services (for

example, the requirements do not apply to simple installation or alteration at a public building or

public work that is incidental to furnishing supplies or equipment under a supply contract; however,

if a substantial and segregable amount of construction, alteration, or repair is required, such as for

installation of heavy generators or large refrigerator systems or for plant modification or

rearrangement, the requirements of this subpart apply); or

(ii) The construction work is so merged with non- construction work or so fragmented in terms of the

locations or time spans in which it is to be performed, that it is not capable of being segregated as a

separate contractual requirement.

22.403 Statutory, Executive Order, and regulatory

requirements.
22.403-1 Construction Wage Rate Requirements statute.

40 U.S.C. chapter 31, subchapter IV, Wage Rate Requirements (Construction), formerly known as

the Davis-Bacon Act, provides that contracts in excess of $2,000 to which the United States or the

District of Columbia is a party for construction, alteration, or repair (including painting and

decorating) of public buildings or public works within the United States, shall contain a clause (see

52.222-6) that no laborer or mechanic employed directly upon the site of the work shall receive less

than the prevailing wage rates as determined by the Secretary of Labor.

22.403-2 Copeland Act.

The Copeland (Anti-Kickback) Act (18 U.S.C.874 and 40 U.S.C.3145) makes it unlawful to induce, by

force, intimidation, threat of procuring dismissal from employment, or otherwise, any person

employed in the construction or repair of public buildings or public works, financed in whole or in

part by the United States, to give up any part of the compensation to which that person is entitled

under a contract of employment. The Copeland Act also requires each contractor and subcontractor

to furnish weekly a statement of compliance with respect to the wages paid each employee during

the preceding week. Contracts subject to the Copeland Act shall contain a clause (see 52.222-10)

requiring contractors and subcontractors to comply with the regulations issued by the Secretary of

Labor under the Copeland Act.

22.403-3 Contract Work Hours and Safety Standards.

40 U.S.C.chpater 37, Contract Work Hours and Safety Standards, requires that certain contracts

(see 22.305) contain a clause (see 52.222-4) specifying that no laborer or mechanic doing any part of

the work contemplated by the contract shall be required or permitted to work more than 40 hours in

any workweek unless paid for all additional hours at not less than 1 1/2 times the basic rate of pay

(see 22.301).

22.403-4 Executive Orders 13658 and 14026.

Executive Order (E.O.) 13658 established minimum wages for certain workers at $10.10 per hour.

The E.O. 13658 rate has increased each year since 2015, rising to $11.25 on January 1, 2022. As of

January 30, 2022, E.O. 13658 is superseded by E.O. 14026 to the extent that it is inconsistent with

E.O. 14026; the minimum wage rate for certain workers is increased to $15.00 per hour. The wage

rate is subject to annual increases by an amount determined by the Secretary of Labor. See subpart 

22.19. The clause at 52.222-55, Minimum Wages for Contractor Workers under Executive Order

14026, requires the E.O. 14026 minimum wage rate to be paid if it is higher than other minimum

wage rates, such as the subpart 22.4 statutory wage determination amount.

22.403-5 Executive Order 13706.

Executive Order 13706 establishes paid sick leave for employees of certain Federal contractors. See

subpart 22.21 and the clause at 52.222-62, Paid Sick Leave under Executive Order 13706.
22.403-6 Department of Labor regulations involving construction.

(a) Under the statutes and Executive orders referred to in 22.403 and Reorganization Plan No. 14 of

1950 (3 CFR 1949-53 Comp., p. 1007), the Secretary of Labor has issued regulations in Title 29,

Subtitle A, Code of Federal Regulations, prescribing standards and procedures to be observed by the

Department of Labor and the Federal contracting agencies. Those standards and procedures

applicable to contracts involving construction are implemented in this subpart.

(b) The Department of Labor regulations include-

(1) Part 1, relating to Construction Wage Rate Requirements statute minimum wage rates;

(2) Part 3, relating to the Copeland (Anti-Kickback) Act and requirements for submission of weekly

statements of compliance and the preservation and inspection of weekly payroll records;

(3) Part 5, relating to enforcement of the–

(i) Construction Wage Rate Requirements statute;

(ii) Contract Work Hours and Safety Standards statute; and

(iii) Copeland (Anti-Kickback) Act;

(4) Part 6, relating to rules of practice for appealing the findings of the Administrator, Wage and

Hour Division, in enforcement cases under the various labor statutes, and by which Administrative

Law Judge hearings are held;

(5) Part 7, relating to rules of practice by which contractors and other interested parties may appeal

to the Department of Labor Administrative Review Board, decisions issued by the Administrator,

Wage and Hour Division, or administrative law judges under the various labor statutes;

(6) Part 10, relating to establishing a minimum wage for Federal contractors; and

(7) Part 13, relating to establishing paid sick leave for Federal contractors.

(c) Refer all questions relating to the application and interpretation of wage determinations

(including the classifications therein) and the interpretation of the Department of Labor regulations

in this subsection to the Administrator, Wage and Hour Division.

22.404 Construction Wage Rate Requirements statute wage

determinations.

The Department of Labor is responsible for issuing wage determinations reflecting prevailing wages,

including fringe benefits. The wage determinations apply only to those laborers and mechanics

employed by a contractor upon the site of the work including drivers who transport to or from the

site materials and equipment used in the course of contract operations. Determinations are issued

for different types of construction, such as building, heavy, highway, and residential (referred to as

rate schedules), and apply only to the types of construction designated in the determination.
22.404-1 Types of wage determinations.

(a) General wage determinations.

(1) A general wage determination contains prevailing wage rates for the types of construction

designated in the determination, and is used in contracts performed within a specified geographical

area. General wage determinations contain no expiration date and remain valid until modified,

superseded, or canceled by the Department of Labor. Once incorporated in a contract, a general

wage determination normally remains effective for the life of the contract, unless the contracting

officer exercises an option to extend the term of the contract (see 22.404-12). These determinations

shall be used whenever possible. They are issued at the discretion of the Department of Labor either

upon receipt of an agency request or on the Department of Labor’s own initiative.

(2) General wage determinations are published on the Wage Determinations at SAM.gov website.

General wage determinations are effective on the publication date of the wage determination or

upon receipt of the wage determination by the contracting agency, whichever occurs first.

“Publication” within the meaning of this section shall occur on the first date the wage determination

is published on the Wage Determinations at SAM.gov. Archived Construction Wage Rate

Requirements statute general wage determinations that are no longer current may be accessed in

the “Archived DB WD” database on Wage Determinations at SAM.gov website for information

purposes only. Contracting officers may not use an archived wage determination in a contract action

without obtaining prior approval of the Department of Labor. To obtain prior approval, contact the

Department of Labor, Wage and Hour Division, using https://www.sam.gov, or contact the

procurement agency labor advisor listed on https://www.sam.gov.

(b) Project wage determinations. A project wage determination is issued at the specific request of a

contracting agency. It is used only when no general wage determination applies, and is effective for

180 calendar days from the date of the determination. However, if a determination expires before

contract award, it may be possible to obtain an extension to the 180-day life of the determination

(see 22.404-5(b)(2)). Once incorporated in a contract, a project wage determination normally

remains effective for the life of the contract, unless the contracting officer exercises an option to

extend the term of the contract (see 22.404-12).

22.404-2 General requirements.

(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.

22.404-3 Procedures for requesting wage determinations.

(a) General wage determinations. If there is a general wage determination on the Wage

Determinations at SAM.gov website applicable to the project, the agency may use it without

notifying the Department of Labor. When necessary, a request for a general wage determination

may be made by submitting Standard Form (SF) 308, Request for Determination and Response to

Request, to the Administrator, Wage and Hour Division, Attention: Branch of Construction Contract

Wage Determinations, 200 Constitution Avenue, NW, Washington, DC 20210.

(b) Project wage determinations. If a general wage determination is not available on Wage

Determinations at SAM.gov, a contracting agency shall submit requests for project wage

determinations on SF 308 to the Department of Labor. The requests shall include the following

information:

(1) The location, including the county (or other civil subdivision) and State in which the proposed

project is located.

(2) The name of the project and a sufficiently detailed description of the work to indicate the types of

construction involved (e.g., building, heavy, highway, residential, or other type).

(3) Any available pertinent wage payment information, unless wage patterns in the area are clearly

established.
(4) The estimated cost of each project.

(5) All the classifications of laborers and mechanics likely to be employed.

(c) Time for submission of requests.

(1) The time required by the Department of Labor for processing requests for project wage

determinations varies according to the facts and circumstances in each case. An agency should

expect the processing to take at least 30 days. Accordingly, agencies should submit requests for

project wage determinations for the primary site of the work to the Department of Labor at least 45

days (60 days if possible) before issuing the solicitation or exercising an option to extend the term of

a contract.

(2) Agencies should promptly submit to the Department of Labor an offeror’s request for a project

wage determination for a secondary site of the work.

(d) Review of wage determinations. Immediately upon receipt, the contracting agency shall examine

the wage determination and inform the Department of Labor of any changes necessary or

appropriate to correct errors. Private parties requesting changes should be advised to submit their

requests to the Department of Labor.

22.404-4 Solicitations issued without wage determinations for the primary

site of the work.

(a) If a solicitation is issued before the wage determination for the primary site of the work is

obtained, a notice shall be included in the solicitation that the schedule of minimum wage rates to be

paid under the contract will be issued as an amendment to the solicitation.

(b) In sealed bidding, bids may not be opened until a reasonable time after the wage determination

for the primary site of the work has been furnished to all bidders.

(c) In negotiated acquisitions, the contracting officer may open proposals and conduct negotiations

before obtaining the wage determination for the primary site of the work. However, the contracting

officer shall incorporate the wage determination for the primary site of the work into the solicitation

before submission of best and final offers.

22.404-5 Expiration of project wage determinations.

(a) The contracting officer shall make every effort to ensure that contract award is made before

expiration of the project wage determination included in the solicitation.

(b) The following procedure applies when contracting by sealed bidding:

(1) If a project wage determination for the primary site of the work expires before bid opening, or if

it appears before bid opening that a project wage determination may expire before award, the

contracting officer shall request a new determination early enough to ensure its receipt before bid

opening. If necessary, the contracting officer shall postpone the bid opening date to allow a

reasonable time to obtain the determination, amend the solicitation to incorporate the new

determination, and permit bidders to amend their bids. If the new determination does not change
the wage rates and would not warrant amended bids, the contracting officer shall amend the

solicitation to include the number and date of the new determination.

(2) If a project wage determination for the primary site of the work expires after bid opening but

before award, the contracting officer shall request an extension of the project wage determination

expiration date from the Administrator, Wage and Hour Division. The request for extension shall be

supported by a written finding, which shall include a brief statement of factual support, that the

extension is necessary and proper in the public interest to prevent injustice or undue hardship or to

avoid serious impairment of the conduct of Government business. If necessary, the contracting

officer shall delay award to permit either receipt of the extension or receipt and processing of a new

determination. If the request is granted, the contracting officer shall award the contract and modify

it to apply the extended expiration date to the already incorporated project wage determination.

(See 43.103(b)(1).) If the request is denied, the Administrator will proceed to issue a new project

wage determination. Upon receipt, the contracting officer shall process the new determination as

follows:

(i) If If the new determination for the primary site of the work changes any wage rates for

classifications to be used in the contract, the contracting officer may cancel the solicitation only in

accordance with 14.404-1. Otherwise the contracting officer shall award the contract and

incorporate the new determination to be effective on the date of contract award. The contracting

officer shall equitably adjust the contract price for any increased or decreased cost of performance

resulting from any changed wage rates.

(ii) If the new determination for the primary site of the work does not change any wage rates, the

contracting officer shall award the contract and modify it to include the number and date of the new

determination. (See 43.103(b)(1).)

(c) The following procedure applies when contracting by negotiation:

(1) If a project wage determination will or does expire before contract award, the contracting officer

shall request a new wage determination from the Department of Labor. If necessary, the contracting

officer shall delay award while the new determination is obtained and processed.

(2) The contracting officer need not delay opening and reviewing proposals or discussing them with

the offerors while a new determination for the primary site of the work is being obtained. The

contracting officer shall request offerors to extend the period for acceptance of any proposal if that

period expires or may expire before receipt and full processing of the new determination.

(3) If the new determination for the primary site of the work changes any wage rates, the

contracting officer shall amend the solicitation to incorporate the new determination, and furnish

the wage rate information to all prospective offerors that were sent a solicitation if the closing date

for receipt of proposals has not yet occurred, or to all offerors that have not been eliminated from

the competition if the closing date has passed. All offerors to whom wage rate information has been

furnished shall be given reasonable opportunity to amend their proposals.

(4) If the new determination for the primary site of the work does not change any wage rates, the

contracting officer shall amend the solicitation to include the number and date of the new

determination and award the contract.

22.404-6 Modifications of wage determinations.
(a) General.

(1) The Department of Labor may modify a wage determination to make it current by specifying only

the items being changed or by reissuing the entire determination with changes incorporated.

(2) All project wage determination modifications expire on the same day as the original

determination. The need to include a modification of a project wage determination for the primary

site of the work in a solicitation is determined by the time of receipt of the modification by the

contracting agency. Therefore, the contracting agency must annotate the modification of the project

wage determination with the date and time immediately upon receipt.

(3) The need for inclusion of the modification of a general wage determination for the primary site of

the work in a solicitation is determined by the date the modified wage determination is published on

the Wage Determinations at SAM.gov , or by the date the agency receives actual written notice of

the modification from the Department of Labor, whichever occurs first. (Note the distinction

between receipt by the agency (modification is effective) and receipt by the contracting officer,

which may occur later.) During the course of the solicitation, the contracting officer shall monitor

the Wage Determinations at SAM.gov website to determine whether the applicable wage

determination has been revised. Revisions published on the Wage Determinations at SAM.gov

website or otherwise communicated to the contracting officer within the timeframes prescribed at

22.404-6(b) and (c) are applicable and must be included in the resulting contract. Monitoring can be

accomplished by use of the Wage Determinations at SAM.gov website’s "Alert Service".

(b) The following applies when contracting by sealed bidding:

(1) A written action modifying a wage determination shall be effective if:

(i) It is received by the contracting agency, or is published on the Wage Determinations at SAM.gov,

10 or more calendar days before the date of bid opening; or

(ii) It is received by the contracting agency, or is published on the Wage Determinations at SAM.gov

, less than 10 calendar days before the date of bid opening, unless the contracting officer finds that

there is not reasonable time available before bid opening to notify the prospective bidders. (If the

contracting officer finds that there is not reasonable time to notify bidders, a written report of the

finding shall be placed in the contract file and shall be made available to the Department of Labor

upon request.)

(2) All written actions modifying wage determinations received by the contracting agency after bid

opening, or modifications to general wage determinations published on the Wage Determinations at

SAM.gov after bid opening, shall not be effective and shall not be included in the solicitation (but see

paragraph (b)(6) of this subsection).

(3) If an effective modification of the wage determination for the primary site of the work is received

by the contracting officer before bid opening, the contracting officer shall postpone the bid opening,

if necessary, to allow a reasonable time to amend the solicitation to incorporate the modification and

permit bidders to amend their bids. If the modification does not change the wage rates and would

not warrant amended bids, the contracting officer shall amend the solicitation to include the number

and date of the modification.

(4) If an effective modification of the wage determination for the primary site of the work is received

by the contracting officer after bid opening, but before award, the contracting officer shall follow the

procedures in 22.404-5(b)(2)(i) or (ii).
(5) If an effective modification is received by the contracting officer after award, the contracting

officer shall modify the contract to incorporate the wage modification retroactive to the date of

award and equitably adjust the contract price for any increased or decreased cost of performance

resulting from any changed wage rates. If the modification does not change any wage rates and

would not warrant contract price adjustment, the contracting officer shall modify the contract to

include the number and date of the modification.

(6) If an award is not made within 90 days after bid opening, any modification to a general wage

determination which is published on the Wage Determinations at SAM.gov before award, shall be

effective for any resultant contract unless an extension of the 90-day period is obtained from the

Administrator, Wage and Hour Division. An agency head may request such an extension from the

Administrator. The request must be supported by a written finding, which shall include a brief

statement of factual support, that the extension is necessary and proper in the public interest to

prevent injustice, undue hardship, or to avoid serious impairment in the conduct of Government

business. The contracting officer shall follow the procedures in 22.404-5(b)(2).

(c) The following applies when contracting by negotiation:

(1) All written actions modifying wage determinations received by the contracting agency before

contract award, or modifications to general wage determinations published on the Wage

Determinations at SAM.gov before award, shall be effective.

(2) If an effective wage modification is received by the contracting officer before award, the

contracting officer shall follow the procedures in 22.404-5(c)(3) or (4).

(3) If an effective wage modification is received by the contracting officer after award, the

contracting officer shall follow the procedures in 22.404-6(b)(5).

(d) The following applies when modifying a contract to exercise an option to extend the term of a

contract:

(1) A modified wage determination is effective if-

(i) The contracting agency receives a written action from the Department of Labor prior to exercise

of the option, or within 45 days after submission of a wage determination request (22.404-3(c)),

whichever is later; or

(ii) The Department of Labor publishes the modification to a general wage determination on the

Wage Determinations at SAM.gov before exercise of the option.

(2) If the contracting officer receives an effective modified wage determination either before or after

execution of the contract modification to exercise the option, the contracting officer must modify the

contract to incorporate the modified wage determination, and any changed wage rates, effective as

of the date that the option to extend was effective.

22.404-7 Correction of wage determinations containing clerical errors.

Upon the Department of Labor’s own initiative or at the request of the contracting agency, the

Administrator, Wage and Hour Division, may correct any wage determination found to contain

clerical errors. Such corrections will be effective immediately, and will apply to any solicitation or

active contract. Before contract award, the contracting officer must follow the procedures in
22.404-5(b)(1) or (2)(i) or (ii) in sealed bidding, and the procedures in 22.404-5(c)(3) or (4) in

negotiations. After contract award, the contracting officer must follow the procedures at

22.404-6(b)(5), except that for contract modifications to exercise an option to extend the term of the

contract, the contracting officer must follow the procedures at 22.404-6(d)(2).

22.404-8 Notification of improper wage determination before award.

(a) The following written notifications by the Department of Labor shall be effective immediately

without regard to 22.404-6 if received by the contracting officer prior to award:

(1) A solicitation includes the wrong wage determination or the wrong rate schedule; or

(2) A wage determination is withdrawn by the Administrative Review Board.

(b) In sealed bidding, the contracting officer shall proceed in accordance with the following:

(1) If the notification of an improper wage determination for the primary site of the work reaches the

contracting officer before bid opening, the contracting officer shall postpone the bid opening date, if

necessary, to allow a reasonable time to-

(i) Obtain the appropriate determination if a new wage determination is required;

(ii) Amend the solicitation to incorporate the determination (or rate schedule); and

(iii) Permit bidders to amend their bids. If the appropriate wage determination does not change any

wage rates and would not warrant amended bids, the contracting officer shall amend the solicitation

to include the number and date of the new determination.

(2) If the notification of an improper wage determination for the primary site of the work reaches the

contracting officer after bid opening but before award, the contracting officer shall delay awarding

the contract, if necessary, and if required, obtain the appropriate wage determination. The

appropriate wage determination shall be processed in accordance with 22.404-5(b)(2)(i) or (ii).

(c) In negotiated acquisitions, the contracting officer shall delay award, if necessary, and process the

notification of an improper wage determination for the primary site of the work in the manner

prescribed for a new wage determination at 22.404-5(c)(3).

22.404-9 Award of contract without required wage determination.

(a) If a contract is awarded without the required wage determination (i.e., incorporating no

determination, containing a clearly inapplicable general wage determination, or containing a project

determination which is inapplicable because of an inaccurate description of the project or its

location), the contracting officer shall initiate action to incorporate the required determination in the

contract immediately upon discovery of the error. If a required wage determination (valid

determination in effect on the date of award) is not available, the contracting officer shall

expeditiously request a wage determination from the Department of Labor, including a statement

explaining the circumstances and giving the date of the contract award.

(b) The contracting officer shall-
(1) Modify the contract to incorporate the required wage determination (retroactive to the date of

award) and equitably adjust the contract price if appropriate; or

(2) Terminate the contract.

22.404-10 Posting wage determinations and notice.

The contractor must keep a copy of the applicable wage determination (and any approved additional

classifications) posted at the site of the work in a prominent place where the workers can easily see

it. The contracting officer shall furnish to the contractor, Department of Labor FormWH-1321,

Notice to Employees Working on Federal and Federally Financed Construction Projects, for posting

with the wage rates. The name, address, and telephone number of the Government officer

responsible for the administration of the contract shall be indicated in the poster to inform workers

to whom they may submit complaints or raise questions concerning labor standards.

22.404-11 Wage determination appeals.

The Secretary of Labor has established an Administrative Review Board which decides appeals of

final decisions made by the Department of Labor concerning Construction Wage Rate Requirements

statute wage determinations. A contracting agency or other interested party may file a petition for

review under the procedures in 29 CFR Part 7 if reconsideration by the Administrator has been

sought pursuant to 29 CFR1.8 and denied.

22.404-12 Labor standards for contracts containing construction

requirements and option provisions that extend the term of the contract.

(a) Each time the contracting officer exercises an option to extend the term of a contract for

construction, or a contract that includes substantial and segregable construction work, the

contracting officer must modify the contract to incorporate the most current wage determination.

(b) If a contract with an option to extend the term of the contract has indefinite-delivery or

indefinite-quantity construction requirements, the contracting officer must incorporate the wage

determination incorporated into the contract at the exercise of the option into task orders issued

during that option period. The wage determination will be effective for the complete period of

performance of those task orders without further revision.

(c) The contracting officer must include in fixed-price contracts a clause that specifies one of the

following methods, suitable to the interest of the Government, to provide an allowance for any

increases or decreases in labor costs that result from the inclusion of the current wage

determination at the exercise of an option to extend the term of the contract:

(1) The contracting officer may provide the offerors the opportunity to bid or propose separate

prices for each option period. The contracting officer must not further adjust the contract price as a

result of the incorporation of a new or revised wage determination at the exercise of each option to

extend the term of the contract. Generally, this method is used in construction-only contracts (with

options to extend the term) that are not expected to exceed a total of 3 years.

(2) The contracting officer may include in the contract a separately specified pricing method that
permits an adjustment to the contract price or contract labor unit price at the exercise of each

option to extend the term of the contract. At the time of option exercise, the contracting officer must

incorporate a new wage determination into the contract, and must apply the specific pricing method

to calculate the contract price adjustment. An example of a contract pricing method that the

contracting officer might separately specify is incorporation in the solicitation and resulting contract

of the pricing data from an annually published unit pricing book (e.g., the U.S. Army ComputerAided Cost Estimating System or similar commercial product), which is multiplied in the contract by

a factor proposed by the contractor (e.g., .95 or 1.1). At option exercise, the contracting officer

incorporates the pricing data from the latest annual edition of the unit pricing book, multiplied by

the factor agreed to in the basic contract. The contracting officer must not further adjust the

contract price as a result of the incorporation of the new or revised wage determination.

(3) The contracting officer may provide for a contract price adjustment based solely on a percentage

rate determined by the contracting officer using a published economic indicator incorporated into

the solicitation and resulting contract. At the exercise of each option to extend the term of the

contract, the contracting officer will apply the percentage rate, based on the economic indicator, to

the portion of the contract price or contract unit price designated in the contract clause as labor

costs subject to the provisions of the Construction Wage Rate Requirements statute. The contracting

officer must insert 50 percent as the estimated portion of the contract price that is labor unless the

contracting officer determines, prior to issuance of the solicitation, that a different percentage is

more appropriate for a particular contract or requirement. This percentage adjustment to the

designated labor costs must be the only adjustment made to cover increases in wages and/or

benefits resulting from the incorporation of a new or revised wage determination at the exercise of

the option.

(4) The contracting officer may provide a computation method to adjust the contract price to reflect

the contractor’s actual increase or decrease in wages and fringe benefits (combined) to the extent

that the increase is made to comply with, or the decrease is voluntarily made by the contractor as a

result of incorporation of, a new or revised wage determination at the exercise of the option to

extend the term of the contract. Generally, this method is appropriate for use only if contract

requirements are predominately services subject to the Service Contract Labor Standards statute

and the construction requirements are substantial and segregable. The methods used to adjust the

contract price for the service requirements and the construction requirements would be similar.

22.405 [Reserved]

22.406 Administration and enforcement.

22.406-1 Policy.

(a) General. Contracting agencies are responsible for ensuring the full and impartial enforcement of

labor standards in the administration of construction contracts. Contracting agencies shall maintain

an effective program that shall include-

(1) Ensuring that contractors and subcontractors are informed, before commencement of work, of

their obligations under the labor standards clauses of the contract;

(2) Adequate payroll reviews, on-site inspections, and employee interviews to determine compliance
by the contractor and subcontractors, and prompt initiation of corrective action when required;

(3) Prompt investigation and disposition of complaints; and

(4) Prompt submission of all reports required by this subpart.

(b) Preconstruction letters and conferences. Before construction begins, the contracting officer shall

inform the contractor of the labor standards clauses and wage determination requirements of the

contract and of the contractor’s and any subcontractor’s responsibilities under the contract. Unless

it is clear that the contractor is fully aware of the requirements, the contracting officer shall issue an

explanatory letter and/or arrange a conference with the contractor promptly after award of the

contract.

22.406-2 Wages, fringe benefits, and overtime.

(a) In computing wages paid to a laborer or mechanic, the contractor may include only the following

items:

(1) Amounts paid in cash to the laborer or mechanic, or deducted from payments under the

conditions set forth in 29 CFR3.5.

(2) Contributions (except those required by Federal, State, or local law) the contractor makes

irrevocably to a trustee or a third party under any bona fide plan or program to provide for medical

or hospital care, pensions, compensation for injuries or illness resulting from occupational activity,

unemployment benefits, life insurance, disability and sickness insurance, accident insurance, or any

other bona fide fringe benefit.

(3) Other contributions or anticipated costs for bona fide fringe benefits to the extent expressly

approved by the Secretary of Labor.

(b)

(1) The contractor may satisfy the obligation under the clause at 52.222-6, Construction Wage Rate

Requirements, by providing wages consisting of any combination of contributions or costs as

specified in paragraph (a) of this subsection, if the total cost of the combination is not less than the

total of the basic hourly rate and fringe benefits payments prescribed in the wage determination for

the classification of laborer or mechanic concerned.

(2) Wages provided by the contractor and fringe benefits payments required by the wage

determination may include items that are not stated as exact cash amounts. In these cases, the

hourly cash equivalent of the cost of these items shall be determined by dividing the employer’s

contributions or costs by the employee’s hours worked during the period covered by the costs or

contributions. For example, if a contractor pays a monthly health insurance premium of $112 for a

particular employee who worked 125 hours during the month, the hourly cash equivalent is

determined by dividing $112 by 125 hours, which equals $0.90 per hour. Similarly, the calculation of

hourly cash equivalent for nine paid holidays peryear for an employee with a hourly rate of pay of

$5.00 is determined by multiplying $5.00 by 72 (9 days at 8 hours each), and dividing the result of

$360 by the number of hours worked by the employee during the year. If the interested parties

(contractor, contracting officer, and employees or their representative) cannot agree on the cash

equivalent, the contracting officer shall submit the question for final determination to the
Department of Labor as prescribed by agency procedures. The information submitted shall include-

(i) A comparison of the payments, contributions, or costs in the wage determination with those made

or proposed as equivalents by the contractor; and

(ii) The comments and recommendations of the contracting officer.

(c) In computing required overtime payments, (i.e.,1 1/2 times the basic hourly rate of pay) the

contractor shall use the basic hourly rate of pay in the wage determination, or the basic hourly rate

actually paid by the contractor, if higher. The basic rate of pay includes employee contributions to

fringe benefits, but excludes the contractor’s contributions, costs, or payment of cash equivalents for

fringe benefits. Overtime shall not be computed on a rate lower than the basic hourly rate in the

wage determination.

22.406-3 Additional classifications.

(a) If any laborer or mechanic is to be employed in a classification that is not listed in the wage

determination applicable to the contract, the contracting officer, pursuant to the clause at 52.222-6,

Construction Wage Rate Requirements, shall require that the contractor submit to the contracting

officer, Standard Form (SF) 1444, Request for Authorization of Additional Classification and Rate,

which, along with other pertinent data, contains the proposed additional classification and minimum

wage rate including any fringe benefits payments.

(b) Upon receipt of SF 1444 from the contractor, the contracting officer shall review the request to

determine whether it meets the following criteria:

(1) The classification is appropriate and the work to be performed by the classification is not

performed by any classification contained in the applicable wage determination.

(2) The classification is utilized in the area by the construction industry.

(3) The proposed wage rate, including any fringe benefits, bears a reasonable relationship to the

wage rates in the wage determination in the contract.

(c)

(1) If the criteria in paragraph (b) of this subsection are met and the contractor and the laborers or

mechanics to be employed in the additional classification (if known) or their representatives agree to

the proposed additional classification, and the contracting officer approves, the contracting officer

shall submit a report (including a copy of SF 1444) of that action to the Administrator, Wage and

Hour Division, for approval, modification, or disapproval of the additional classification and wage

rate (including any amount designated for fringe benefits); or

(2) If the contractor, the laborers or mechanics to be employed in the classification or their

representatives, and the contracting officer do not agree on the proposed additional classification, or

if the criteria are not met, the contracting officer shall submit a report (including a copy of SF 1444)

giving the views of all interested parties and the contracting officer’s recommendation to the

Administrator, Wage and Hour Division, for determination of appropriate classification and wage

rate.
(d)

(1) Within 30 days of receipt of the report, the Administrator, Wage and Hour Division, will complete

action and so advise the contracting officer, or will notify the contracting officer that additional time

is necessary.

(2) Upon receipt of the Department of Labor’s action, the contracting officer shall forward a copy of

the action to the contractor, directing that the classification and wage rate be posted in accordance

with paragraph (a) of the clause at 52.222-6 and that workers in the affected classification receive

no less than the minimum rate indicated from the first day on which work under the contract was

performed in the classification.

(e) In each option to extend the term of the contract, if any laborer or mechanic is to be employed

during the option in a classification that is not listed (or no longer listed) on the wage determination

incorporated in that option, the contracting officer must require that the contractor submit a request

for conformance using the procedures noted in paragraphs (a) through (d) of this section.

22.406-4 Apprentices and trainees.

(a) The contracting officer shall review the contractor’s employment and payment records of

apprentices and trainees made available pursuant to the clause at 52.222-8, Payrolls and Basic

Records, to ensure that the contractor has complied with the clause at 52.222-9, Apprentices and

Trainees.

(b) If a contractor has classified employees as apprentices, trainees, or helpers without complying

with the requirements of the clause at 52.222-9, the contracting officer shall reject the classification

and require the contractor to pay the affected employees at the rates applicable to the classification

of the work actually performed.

22.406-5 Subcontracts.

In accordance with the requirements of the clause at 52.222-11, Subcontracts (Labor Standards),

the contractor and subcontractors at any tier are required to submit a fully executed SF 1413,

Statement and Acknowledgment, upon award of each subcontract.

22.406-6 Payrolls and statements.

(a) Submission. In accordance with the clause at 52.222-8, Payrolls and Basic Records, the

contractor must submit or cause to be submitted, within 7 calendar days after the regular payment

date of the payroll week covered, for the contractor and each subcontractor, (1) copies of weekly

payrolls applicable to the contract, and (2) weekly payroll statements of compliance. The contractor

may use the Department of Labor FormWH-347, Payroll (For Contractor’s Optional Use), or a similar

form that provides the same data and identical representation.

(b) Withholding for nonsubmission. If the contractor fails to submit copies of its or its

subcontractors’ payrolls promptly, the contracting officer shall, from any payment due to the

contractor, withhold approval of an amount that the contracting officer considers necessary to

protect the interest of the Government and the employees of the contractor or any subcontractor.
(c) Examination.

(1) The contracting officer shall examine the payrolls and payroll statements to ensure compliance

with the contract and any statutory or regulatory requirements. Particular attention should be given

to-

(i) The correctness of classifications and rates;

(ii) Fringe benefits payments;

(iii) Hours worked;

(iv) Deductions; and

(v) Disproportionate employment ratios of laborers, apprentices or trainees to journeymen.

(2) Fringe benefits payments, contributions made, or costs incurred on other than a weekly basis

shall be considered as a part of weekly payments to the extent they are creditable to the particular

weekly period involved and are otherwise acceptable.

(d) Preservation. The contracting agency shall retain payrolls and statements of compliance for 3

years after completion of the contract and make them available when requested by the Department

of Labor at any time during that period. Submitted payrolls shall not be returned to a contractor or

subcontractor for any reason, but copies thereof may be furnished to the contractor or subcontractor

who submitted them, or to a higher tier contractor or subcontractor.

(e) Disclosure of payroll records. Contractor payroll records in the Government’s possession must be

carefully protected from any public disclosure which is not required by law, since payroll records

may contain information in which the contractor’s employees have a privacy interest, as well as

information in which the contractor may have a proprietary interest that the Government may be

obliged to protect. Questions concerning release of this information may involve the Freedom of

Information Act (FOIA).

22.406-7 Compliance checking.

(a) General. The contracting officer shall make checks and investigations on all contracts covered by

this subpart as may be necessary to ensure compliance with the labor standards requirements of the

contract.

(b) Regular compliance checks. Regular compliance checking includes the following activities:

(1) Employee interviews to determine correctness of classifications, rates of pay, fringe benefits

payments, and hours worked. (See Standard Form 1445.)

(2) On-site inspections to check type of work performed, number and classification of workers, and

fulfillment of posting requirements.

(3) Payroll reviews to ensure that payrolls of prime contractors and subcontractors have been

submitted on time and are complete and in compliance with contract requirements.

(4) Comparison of the information in this paragraph (b) with available data, including daily

inspector’s report and daily logs of construction, to ensure consistency.
(c) Special compliance checks. Situations that may require special compliance checks include -

(1) Inconsistencies, errors, or omissions detected during regular compliance checks; or

(2) Receipt of a complaint alleging violations. If the complaint is not specific enough, the

complainant shall be so advised and invited to submit additional information.

22.406-8 Investigations.

Conduct labor standards investigations when available information indicates such action is

warranted. In addition, the Department of Labor may conduct an investigation on its own initiative

or may request a contracting agency to do so.

(a) Contracting agency responsibilities. Conduct an investigation when a compliance check indicates

that substantial or willful violations may have occurred or violations have not been corrected.

(1) The investigation must-

(i) Include all aspects of the contractor’s compliance with contract labor standards requirements;

(ii) Not be limited to specific areas raised in a complaint or uncovered during compliance checks;

and

(iii) Use personnel familiar with labor laws and their application to contracts.

(2) Do not disclose contractor employees’ oral or written statements taken during an investigation or

the employee’s identity to anyone other than an authorized Government official without that

employee’s prior signed consent.

(3) Send a written request to the Administrator, Wage and Hour Division, to obtain-

(i) Investigation and enforcement instructions; or

(ii) Available pertinent Department of Labor files.

(4) Obtain permission from the Department of Labor before disclosing material obtained from Labor

Department files, other than computations of back wages and liquidated damages and summaries of

back wages due, to anyone other than Government contract administrators.

(b) Investigation report. The contracting officer must review the investigation report on receipt and

make preliminary findings. The contracting officer normally must not base adverse findings solely on

employee statements that the employee does not wish to have disclosed. However, if the

investigation establishes a pattern of possible violations that are based on employees’ statements

that are not authorized for disclosure, the pattern itself may support a finding of noncompliance.

(c) Contractor Notification. After completing the review, the contracting officer must-

(1) Provide the contractor any written preliminary findings and proposed corrective actions, and

notice that the contractor has the right to request that the basis for the findings be made available

and to submit written rebuttal information.

(2) Upon request, provide the contractor with rationale for the findings. However, under no
circumstances will the contracting officer permit the contractor to examine the investigation report.

Also, the contracting officer must not disclose the identity of any employee who filed a complaint or

who was interviewed, without the prior consent of the employee.

(3)

(i) The contractor may rebut the findings in writing within 60 days after it receives a copy of the

preliminary findings. The rebuttal becomes part of the official investigation record. If the contractor

submits a rebuttal, evaluate the preliminary findings and notify the contractor of the final findings.

(ii) If the contracting officer does not receive a timely rebuttal, the contracting officer must consider

the preliminary findings final.

(4) If appropriate, request the contractor to make restitution for underpaid wages and assess

liquidated damages. If the request includes liquidated damages, the request must state that the

contractor has 60 days to request relief from such assessment.

(d) Contracting officer’s report. After taking the actions prescribed in paragraphs (b) and (c) of this

subsection-

(1) The contracting officer must prepare and forward a report of any violations, including findings

and supporting evidence, to the agency head. Standard Form 1446, Labor Standards Investigation

Summary Sheet, is the first page of the report; and

(2) The agency head must process the report as follows:

(i) The contracting officer must send a detailed enforcement report to the Administrator, Wage and

Hour Division, within 60 days after completion of the investigation, if-

(A) A contractor or subcontractor underpaid by $1,000 or more;

(B) The contracting officer believes that the violations are aggravated or willful (or there is reason to

believe that the contractor has disregarded its obligations to employees and subcontractors under

the Construction Wage Rate Requirements statute);

(C) The contractor or subcontractor has not made restitution; or

(D) Future compliance has not been assured.

(ii) If the Department of Labor expressly requested the investigation and none of the conditions in

paragraph (d)(2)(i) of this subsection exist, submit a summary report to the Administrator, Wage and

Hour Division. The report must include-

(A) A summary of any violations;

(B) The amount of restitution paid;

(C) The number of workers who received restitution;

(D) The amount of liquidated damages assessed under the Contract Work Hours and Safety

Standards statute;

(E) Corrective measures taken; and
(F) Any information that may be necessary to review any recommendations for an appropriate

adjustment in liquidated damages.

(iii) If none of the conditions in paragraphs (d)(2)(i) or (ii) of this subsection are present, close the

case and retain the report in the appropriate contract file.

(iv) If substantial evidence is found that violations are willful and in violation of a criminal statute,

(generally 18 U.S.C. 874 or 1001), forward the report (supplemented if necessary) to the Attorney

General of the United States for prosecution if the facts warrant. Notify the Administrator, Wage and

Hour Division, when the report is forwarded for the Attorney General’s consideration.

(e) Department of Labor investigations. The Department of Labor will furnish the contracting officer

an enforcement report detailing violations found and any corrective action taken by the contractor,

in investigations that disclose-

(1) Underpayments totaling $1,000 or more;

(2) Aggravated or willful violations (or, when the contracting officer believes that the contractor has

disregarded its obligations to employees and subcontractors under the Construction Wage Rate

Requirements statute); or

(3) Potential assessment of liquidated damages under the Contract Work Hours and Safety

Standards statute.

(f) Other investigations. The Department of Labor will provide a letter summarizing the findings of

the investigation to the contracting officer for all investigations that are not described in paragraph

(e) of this subsection.

22.406-9 Withholding from or suspension of contract payments.

(a) Withholding from contract payments. If the contracting officer believes a violation exists (see

22.406-8), or upon request of the Department of Labor, the contracting officer must withhold from

payments due the contractor an amount equal to the estimated wage underpayment and estimated

liquidated damages due the United States under the Contract Work Hours and Safety Standards

statute. (See 22.302.)

(1) If the contracting officer believes a violation exists or upon request of the Department of Labor,

the contracting officer must withhold funds from any current Federal contract or Federally assisted

contract with the same prime contractor that is subject to either Construction Wage Rate

Requirements statute or Contract Work Hours and Safety Standards statute requirements.

(2) If a subsequent investigation confirms violations, the contracting officer must adjust the

withholding as necessary. However, if the Department of Labor requested the withholding, the

contracting officer must not reduce or release the withholding without written approval of the

Department of Labor.

(3) Use withheld funds as provided in paragraph (c) of this subsection to satisfy assessed liquidated

damages, and unless the contractor makes restitution, validated wage underpayments.

(b) Suspension of contract payments. If a contractor or subcontractor fails or refuses to comply with

the labor standards clauses of the Construction Wage Rate Requirements statute and related
statutes, the agency, upon its own action or upon the written request of the Department of Labor,

must suspend any further payment, advance, or guarantee of funds until the violations cease or until

the agency has withheld sufficient funds to compensate employees for back wages, and to cover any

liquidated damages due.

(c) Disposition of contract payments withheld or suspended-

(1) Forwarding wage underpayments to the Secretary of Labor. Upon final administrative

determination, if the contractor or subcontractor has not made restitution, the contracting officer

must follow the Department of Labor guidance published in Wage and Hour Division, All Agency

Memorandum (AAM) No. 215, Streamlining Claims for Federal Contractor Employees Act. The AAM

No. 215 can be obtained at http://www.dol.gov/whd/govcontracts/dbra.htm; under Guidance there is

a link for All Agencies Memoranda (AAMs).

(2) Returning of withheld funds to contractor. When funds withheld exceed the amount required to

satisfy validated wage underpayments and assessed liquidated damages, return the funds to the

contractor.

(3) Limitation on returning funds. If the Department of Labor requested the withholding or if the

findings are disputed (see 22.406-10(e)), the contracting officer must not return the funds to the

contractor without approval by the Department of Labor.

(4) Liquidated damages. Upon final administrative determination, the contracting officer must

dispose of funds withheld or collected for liquidated damages in accordance with agency

procedures.

22.406-10 Disposition of disputes concerning construction contract labor

standards enforcement.

(a) The areas of possible differences of opinion between contracting officers and contractors in

construction contract labor standards enforcement include-

(1) Misclassification of workers;

(2) Hours of work;

(3) Wage rates and payment;

(4) Payment of overtime;

(5) Withholding practices; and

(6) The applicability of the labor standards requirements under varying circumstances.

(b) Generally, these differences are settled administratively at the project level by the contracting

agency. If necessary, these differences may be settled with assistance from the Department of

Labor.

(c) When requesting the contractor to take corrective action in labor violation cases, the contracting

officer shall inform the contractor of the following:
(1) Disputes concerning the labor standards requirements of the contract are handled under the

contract clause at 52.222-14, Disputes Concerning Labor Standards, and not under the clause at

52.233-1, Disputes.

(2) The contractor may appeal the contracting officer’s findings or part thereof by furnishing the

contracting officer a complete statement of the reasons for the disagreement with the findings.

(d) The contracting officer shall promptly transmit the contracting officer’s findings and the

contractor’s statement to the Administrator, Wage and Hour Division.

(e) The Administrator, Wage and Hour Division, will respond directly to the contractor or

subcontractor, with a copy to the contracting agency. The contractor or subcontractor may appeal

the Administrator’s findings in accordance with the procedures outlined in Labor Department

Regulations (29 CFR5.11). Hearings before administrative law judges are conducted in accordance

with 29 CFR Part 6, and hearings before the Labor Department Administrative Review Board are

conducted in accordance with 29 CFR Part 7.

(f) The Administrator, Wage and Hour Division, may institute debarment proceedings against the

contractor or subcontractor if the Administrator finds reasonable cause to believe that the

contractor or subcontractor has committed willful or aggravated violations of the Contract Work

Hours and Safety Standards statute or the Copeland (Anti-Kickback) Act, or any of the applicable

statutes listed in 29 CFR 5.1 other than the Construction Wage Rate Requirements statute, or has

committed violations of the Construction Wage Rate Requirements statute that constitute a

disregard of its obligations to employees or subcontractors under 40 U.S.C. 3144.

22.406-11 Contract terminations.

If a contract or subcontract is terminated for violation of the labor standards clauses, the

contracting agency shall submit a report to the Administrator, Wage and Hour Division. The report

shall include-

(a) The number of the terminated contract;

(b) The name and address of the terminated contractor or subcontractor;

(c) The name and address of the contractor or subcontractor, if any, who is to complete the work;

(d) The amount and number of the replacement contract, if any; and

(e) A description of the work.

22.406-12 Cooperation with the Department of Labor.

(a) The contracting agency shall cooperate with representatives of the Department of Labor in the

inspection of records, interviews with workers, and all other aspects of investigations undertaken by

the Department of Labor. When requested, the contracting agency shall furnish to the Secretary of

Labor any available information on contractors, subcontractors, current and previous contracts, and

the nature of the contract work.

(b) If a Department of Labor representative undertakes an investigation at a construction project,
the contracting officer shall inquire into the scope of the investigation, and request to be notified

immediately of any violations discovered under the Construction Wage Rate Requirements statute,

the Contract Work Hours and Safety Standards statute, or the Copeland (Anti-Kickback) Act.

22.406-13 Semiannual enforcement reports.

A semiannual report on compliance with and enforcement of the construction labor standards

requirements of the Construction Wage Rate Requirements statute and Contract Work Hours and

Safety Standards statute is required from each contracting agency. The reporting periods are

October 1 through March 31 and April 1 through September 30. The reports shall only contain

information as to the enforcement actions of the contracting agency and shall be prepared as

prescribed in Department of Labor memoranda and submitted to the Department of Labor within 30

days after the end of the reporting period. This report has been assigned interagency report control

number 1482-DOL-SA.

22.407 Solicitation provision and contract clauses.

(a) Insert the following clauses in solicitations and contracts in excess of $2,000 for construction

within the United States:

(1) 52.222-6, Construction Wage Rate Requirements.

(2) 52.222-7, Withholding of Funds.

(3) 52.222-8, Payrolls and Basic Records.

(4) 52.222-9, Apprentices and Trainees.

(5) 52.222-10, Compliance with Copeland Act Requirements.

(6) 52.222-11, Subcontracts (Labor Standards).

(7) 52.222-12, Contract Termination-Debarment.

(8) 52.222-13, Compliance with Construction Wage Rate Requirements and Related Regulations.

(9) 52.222-14, Disputes Concerning Labor Standards.

(10) 52.222-15, Certification of Eligibility.

(b) Insert the clause at 52.222-16, Approval of Wage Rates, in solicitations and contracts in excess of

$2,000 for cost-reimbursement construction to be performed within the United States, except for

contracts with a State or political subdivision thereof.

(c) A contract that is not primarily for construction may contain a requirement for some construction

work to be performed in the United States. If under 22.402(b) the requirements of this subpart apply

to the construction work, insert in such solicitations and contracts the applicable construction labor

standards clauses required in this section and identify the item or items of construction work to

which the clauses apply.
(d) [Reserved]

(e) Insert the clause at 52.222-30, Construction Wage Rate Requirements-Price Adjustment (None or

Separately Specified Pricing Method), in solicitations and contracts if the contract is expected to be-

(1) A fixed-price contract subject to the Construction Wage Rate Requirements statute that will

contain option provisions by which the contracting officer may extend the term of the contract, and

the contracting officer determines the most appropriate contract price adjustment method is the

method at 22.404-12(c)(1) or (2); or

(2) A cost-reimbursable type contract subject to the Construction Wage Rate Requirements statute

that will contain option provisions by which the contracting officer may extend the term of the

contract.

(f) Insert the clause at 52.222-31, Construction Wage Rate Requirements-Price Adjustment

(Percentage Method), in solicitations and contracts if the contract is expected to be a fixed-price

contract subject to the Construction Wage Rate Requirements statute that will contain option

provisions by which the contracting officer may extend the term of the contract, and the contracting

officer determines the most appropriate contract price adjustment method is the method at

22.404-12(c)(3).

(g) Insert the clause at 52.222-32, Construction Wage Rate Requirements-Price Adjustment (Actual

Method), in solicitations and contracts if the contract is expected to be a fixed-price contract subject

to the Construction Wage Rate Requirements statute that will contain option provisions by which the

contracting officer may extend the term of the contract, and the contracting officer determines the

most appropriate method to establish contract price is the method at 22.404-12(c)(4).

(h) Insert the provision at 52.222-5, Construction Wage Rate Requirements-Secondary Site of the

Work, in solicitations in excess of $2,000 for construction within the United States.