Service Contract Modernization Act

To establish a socioeconomic labor threshold and use that threshold for purposes of chapter 67 1. Short title This Act may be cited as the Service Contract Modernization Act 2. Socioeconomic labor threshold (a) In general For purposes of this Act, the socioeconomic labor threshold is— (1) for the period beginning on the date of enactment of this Act and ending on October 1 following such date of enactment, the amount determined by the Secretary of Labor under subsection (b)(1); and (2) for each 1-year period beginning on October 1 following such date of enactment, the amount determined by the Secretary of Labor under subsection (b)(2). (b) Inflation adjustments (1) Initial period The amount determined under this paragraph for the period described in subsection (a)(1) shall be $2,500 as— (A) increased by the percentage increase in the Consumer Price Index for All Urban Consumers (all items; United States city average), as published by the Bureau of Labor Statistics, comparing— (i) such Consumer Price Index for October of 1965; and (ii) such Consumer Price Index for the most recent month as of the date of enactment of this Act for which such Consumer Price Index is available; and (B) (if applicable), rounded to the nearest multiple of $100. (2) Subsequent periods (A) In general The amount determined under this paragraph for the applicable period described in subsection (a)(2) shall be the amount in effect on the date of such determination as— (i) increased (if applicable) from such amount by the annual percentage increase, if any, in the Consumer Price Index for All Urban Consumers (all items; United States city average), as published by the Bureau of Labor Statistics, from the preceding year as calculated in accordance with subparagraph (B); and (ii) (if applicable) rounded to the nearest multiple of $100. (B) Consumer Price Index In making the determination under subparagraph (A) and calculating the percentage increase in the Consumer Price Index for All Urban Consumers under subparagraph (A)(i), the Secretary of Labor shall compare the Consumer Price Index for All Urban Consumers (all items; United States city average), as determined by the Bureau of Labor Statistics, for June of the calendar year in which such determination is made with the Consumer Price Index for All Urban Consumers (all items; United States city average), as determined by the Bureau of Labor Statistics, for June of the preceding calendar year. (C) Rule of construction With respect to a determination under subparagraph (A) of the amount in effect under this paragraph for an applicable period under subsection (a)(2), if there is not an annual percentage increase in the Consumer Price Index for All Urban Consumers (all items; United States city average) from the preceding year as described in subparagraph (A)(i), the amount in effect under this subsection for such applicable period shall be the amount in effect under subsection (a) on the date of such determination. 3. Amendments to the McNamara-O'Hara Service Contract Act (a) Definition Section 6701 of title 41, United States Code, is amended— (1) by redesignating paragraph (4) as paragraph (5); and (2) by inserting after paragraph (3) the following: (4) Socioeconomic labor threshold The term socioeconomic labor threshold Service Contract Modernization Act . (b) Applicability threshold Section 6702(a)(2) of title 41, United States Code, is amended to read as follows: (2) involves an amount exceeding— (A) for contracts and bid specifications made prior to the date of enactment of the Service Contract Modernization Act (B) for contracts and bid specifications made on or after such date of enactment, the socioeconomic labor threshold. .

Summary: Service Contract Modernization Act This bill increases a threshold used to determine whether an employee of a federal services contractor or subcontractor is entitled to wages and fringe benefits prevailing in the locality where services are performed (or in a predecessor contractor's collective bargaining agreement). Under current law, a federal contractor or subcontractor that enters into a service contract in excess of $2,500 must comply with prevailing wage and related requirements. This bill increases that amount by adjusting it for inflation since 1965 and provides for future increases based on inflation.