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goods by the Federal Government, does not apply to convict labor that 
satisfies the conditions of section 1761(c) of title 18. 
(4) STANDARDS OF PLACES AND WORKING CONDITIONS WHERE CON-
TRACT PERFORMED.—No part of the contract will be performed, and 
no materials, supplies, articles, or equipment will be manufactured or 
fabricated under the contract, in plants, factories, buildings, or sur-
roundings, or under working conditions, that are unsanitary, haz-
ardous, or dangerous to the health and safety of employees engaged in 
the performance of the contract. Compliance with the safety, sanitary, 
and factory inspection laws of the State in which the work or part of 
the work is to be performed is prima facie evidence of compliance with 
this paragraph. 
§ 6503. Breach or violation of required contract terms 
(a) APPLICABLE BREACH OR VIOLATION.—This section applies in case of 
breach or violation of a representation or stipulation included in a contract 
under section 6502 of this title. 
(b) LIQUIDATED DAMAGES.—In addition to damages for any other breach 
of the contract, the party responsible for a breach or violation described in 
subsection (a) is liable to the Federal Government for the following liq-
uidated damages: 
(1) An amount equal to the sum of $10 per day for each individual 
under 16 years of age and each incarcerated individual knowingly em-
ployed in the performance of the contract. 
(2) An amount equal to the sum of each underpayment of wages due 
an employee engaged in the performance of the contract, including any 
underpayments arising from deductions, rebates, or refunds. 
(c) CANCELLATION AND ALTERNATIVE COMPLETION.—In addition to the 
Federal Government being entitled to damages described in subsection (b), 
the agency of the United States that made the contract may cancel the con-
tract and make open-market purchases or make other contracts for the com-
pletion of the original contract, charging any additional cost to the original 
contractor. 
(d) RECOVERY OF AMOUNTS DUE.—An amount due the Federal Govern-
ment because of a breach or violation described in subsection (a) may be 
withheld from any amounts owed the contractor under any contract under 
section 6502 of this title or may be recovered in a suit brought by the At-
torney General. 
(e) EMPLOYEE REIMBURSEMENT FOR UNDERPAYMENT OF WAGES.—An 
amount withheld or recovered under subsection (d) that is based on an un-
derpayment of wages as described in subsection (b)(2) shall be held in a 
special deposit account. On order of the Secretary, the amount shall be paid 
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directly to the underpaid employee on whose account the amount was with-
held or recovered. However, an employee’s claim for payment under this 
subsection may be entertained only if made within one year from the date 
of actual notice to the contractor of the withholding or recovery. 
§ 6504. Three-year prohibition on new contracts in case of 
breach or violation 
(a) DISTRIBUTION OF LIST.—The Comptroller General shall distribute to 
each agency of the United States a list containing the names of persons 
found by the Secretary to have breached or violated a representation or stip-
ulation included in a contract under section 6502 of this title. 
(b) THREE-YEAR PROHIBITION.—Unless the Secretary recommends oth-
erwise, a contract described in section 6502 of this title may not be awarded 
to a person named on the list under subsection (a), or to a firm, corpora-
tion, partnership, or association in which the person has a controlling inter-
est, until 3 years have elapsed from the date of the determination by the 
Secretary that a breach or violation occurred. 
§ 6505. Exclusions 
(a) ITEMS AVAILABLE IN THE OPEN MARKET.—This chapter does not 
apply to the purchase of materials, supplies, articles, or equipment that may 
usually be bought in the open market. 
(b) PERISHABLES AND AGRICULTURAL PRODUCTS.—This chapter does 
not apply to any of the following: 
(1) Perishables, including dairy, livestock and nursery products. 
(2) Agricultural or farm products processed for first sale by the 
original producers. 
(3) Contracts made by the Secretary of Agriculture for the purchase 
of agricultural commodities or products of agricultural commodities. 
(c) CARRIAGE OF FREIGHT OR PERSONNEL.—This chapter may not be 
construed to apply to— 
(1) the carriage of freight or personnel by vessel, airplane, bus, 
truck, express, or railway line where published tariff rates are in effect; 
or 
(2) common carriers subject to the Communications Act of 1934 (47 
U.S.C. 151 et seq.). 
§ 6506. Administrative provisions 
(a) IN GENERAL.—The Secretary shall administer this chapter. 
(b) REGULATIONS.—The Secretary may make, amend, and rescind regu-
lations as necessary to carry out this chapter. 
(c) USE OF GOVERNMENT OFFICERS AND EMPLOYEES.—The Secretary 
shall use Federal officers and employees and, with a State’s consent, State 
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