52.222-53 Exemption from Application of the

Service Contract Labor Standards to

Contracts for Certain Services-Requirements.

As prescribed in 22.1006(e)(4), insert the following clause:

Exemption from Application of the Service Contract Labor Standards to Contracts for Certain

Services-Requirements (May 2014)

(a) The services under this contract are offered and sold regularly to non-Governmental customers,

and are provided by the Contractor to the general public in substantial quantities in the course of

normal business operations.

(b) The contract services are furnished at prices that are, or are based on, established catalog or

market prices. An "established catalog price" is a price included in a catalog, price list, schedule, or

other form that is regularly maintained by the manufacturer or the Contractor, is either published or

otherwise available for inspection by customers, and states prices at which sales currently, or were

last, made to a significant number of buyers constituting the general public. An "established market

price" is a current price, established in the usual course of ordinary and usual trade between buyers

and sellers free to bargain, which can be substantiated from sources independent of the

manufacturer or Contractor.

(c) Each service employee who will perform the services under the contract will spend only a small

portion of his or her time (a monthly average of less than 20 percent of the available hours on an

annualized basis, or less than 20 percent of available hours during the contract period if the contract

period is less than a month) servicing the Government contract.

(d) The Contractor uses the same compensation (wage and fringe benefits) plan for all service

employees performing work under the contract as the Contractor uses for these employees and for

equivalent employees servicing commercial customers.

(e)

(1) Except for services identified in FAR 22.1003-4(d)(1)(iv), the subcontractor for exempt services

shall be selected for award based on other factors in addition to price or cost with the combination

of other factors at least as important as price or cost; or

(2) A subcontract for exempt services shall be awarded on a sole source basis.

(f) The Contractor is responsible for compliance with all the conditions of this exemption by its

subcontractors. The Contractor shall determine in advance, based on the nature of the subcontract

requirements and knowledge of the practices of likely subcontractors, that all or nearly all likely

subcontractors will meet the conditions in paragraphs (a) through (d) of this clause. If the services

are currently being performed under a subcontract, the Contractor shall consider the practices of

the existing subcontractor in making a determination regarding the conditions in paragraphs (a)

through (d) of this clause. If the Contractor has reason to doubt the validity of the certification, the

requirements of the Service Contract Labor Standards statute shall be included in the subcontract.
(g) If the Department of Labor determines that any conditions for exemption at paragraphs (a)

through (e) of this clause have not been met, the exemption shall be deemed inapplicable, and the

contract shall become subject to the Service Contract Labor Standards statute. In such case, the

procedures in at 29 CFR 4.123(e)(2)(iii) and 29 CFR 4.5(c) will be followed.

(h) The Contractor shall include the substance of this clause, including this paragraph (h), in

subcontracts for exempt services under this contract.

(End of clause)

Parent topic: 52.222 [Reserved]