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Sec. 1-12.403–3 Contracts with a State or polit

ical subdivision. 1-12.404 Administration and enforce

ment. 1-12.404–1 General. 1-12.404–2 Wage determinations. 1-12.4043 Additional classifications. 1-12.4044 Apprentices. 1-12.4045 Subcontracts. 1-12.404-6 Payrolls and statements. 1-12.404–7 Investigations. 1-12.404-8 Reports of violations. 1-12.404–9 Suspensions and deductions of

contract payments. 1-12.404-10 Restitution. 1-12.404-11 Contract terminations. 1-12.404–12 Cooperation with Department

of Labor. 1–12.404–13 Review of recommendations

for an appropriate adjust-
ment in liquidated damages
under the Contract Work

Hours Standards Act.
Subpart 1-12.5— [Reserved)
Subpart 1-12.6~Walsh-Healey Public

Contracts Act 1-12.601 Statutory requirement. 1-12.602 Applicability. 1-12.602-1 General. 1-12.602-2 Statutory exemptions. 1–12.602-3 Department of Labor regula

tions and interpretations. 1–12.603 Determinations of eligibility

as manufacturer or regular

dealer. 1-12.603-1 Manufacturer. 1-12.603–2 Regular dealer. 1-12.603–3 Coal dealers. 1-12.603-4 Agents. 1–12.604 Responsibilities of contracting

officers. 1–12.605 Contract clause. Subpart 1-12.7–Fair Labor Standards Act of

Sec. 1-12.803–9 Notice to bidders regarding

preaward equal opportunity

compliance reviews. 1-12.803-10 Elimination of segregated facil

ities. 1-12.804 Exemptions. 1-12.804-1 General. 1-12.804-2 Specific contracts. 1-12.804-3 Facilities not connected with

contracts. 1-12.804-4 Effect of exemption. 1-12.804-5 Withdrawal of exemption. 1-12.805 Administration. 1-12.805–1 Duties of agencies. 1-12.805–2 Educational responsibility. 1-12.805-3 Notices to be posted. 1-12.805–4 Reports and other required in.

formation. 1-12.805-5 Compliance reviews. 1-12.805-6 Complaints. 1-12.805–7 Processing of matters

agencies. 1-12.805–8 Assumption of jurisdiction by

or referrals to the Director. 1-12.805–9 Sanctions and penalties. 1-12.805–10 Disputed matters related to the

equal opportunity program. 1-12.805–11 Preaward notices. 1-12.806 [Reserved 1-12.807 Hearings. 1-12.807-1 General. 1-12.807–2 Informal hearings. 1-12.807-3 Formal hearings. 1-12.808 Reinstatement of ineligible con

tractors or subcontractors. 1-12.809 Intimidation and interference. 1-12.810 Affirmative action compliance

programs. 1–12.811 Access to records of employ

ment. 1-12.812 Rulings and interpretations. 1-12.813 Solicitations or advertisements

for employees. 1-12.814 Existing contracts and sub

contracts. Subpart 1-12.9-Service Contract Act of 1965 1-12.900 Scope of subpart. 1-12.901 Statutory requirements. 1-12.902 Applicability. 1-12.902–1 Geographical coverage of the Act. 1-12.902–2 Service employee. 1-12.902–3 Statutory exemptions. 1-12.902-4 Administrative limitations, var

iations, tolerances, and exemp

tions. 1-12.903 Department of Labor regulations. 1-12.904 Contract clauses. 1-12.904-1 Clause for Federal service con

tracts in excess of $2,500. 1-12.904–2 Clause for Federal service con

tracts not exceeding $2,500. 1-12.905 Administration and enforcement. 1-12.905–1 Responsibilities of contracting

officers. 1-12.905–2 Register of wage determinations

and fringe benefits. 1–12.905–3 Notice of intention to make a

service contract.

1938

1–12.701 Basic statute.
1-12.702 Rulings on applicablity or in-

terpretation.
Subpart 1-12.8—Equal Opportunity in

Employment 1-12.800 Scope of subpart. 1-12.801 General. 1-12.802 Definitions. 1-12.803 Basic requirements. 1-12.803-1 Government contracts. 1-12.803-2 Equal Opportunity clause. 1-12.803-3 Federally assisted construction

contracts. 1–12.8034 Equal Opportunity (Applicant)

clause. 1-12.803-5 Subcontracts. 1-12.803–6 Adaptation of language. 1-12.803–7 Incorporation by reference. 1-12.803-8 Incorporation by operation of

the Order and agency regulations.

Sec. 1-12.905-4 Use of minimum wage determi

nations and fringe benefit

specifications. 1-12.905-5 Additional classifications. 1-12.905-6 Notice of award. 1-12.905–7 Withholding of contract pay

ments and contract termina

tion. 1-12.905-8 Cooperation with the Depart

ment of Labor. 1–12.905-9 Role of the Comptroller General. 1-12.905–10 Absence of minimum wage de

terminations and fringe bene

fit specifications. Subpart 1-12.10—Nondiscrimination Because of

Age 1-12.1000 Scope of subpart. 1-12.1001 Policy. 1-12.1002 Implementation of policy. 1–12.1003 Handling of complaints.

AUTHORITY: The provisions of this part 1-12 issued under sec. 205 (C), 63 Stat. 390; 40 U.S.C. 486(c).

SOURCE: The provisions of this Part 1-12 appear at 29 F.R. 10264, July 24, 1964, unless otherwise noted. § 1-12.000 Scope of part.

This part deals with general policies regarding labor, so far as they relate to procurement; sets forth certain pertinent labor laws and requirements, indicating in connection with each its applicability and any procedures thereunder; and prescribes the contract clauses with respect to each labor law or requirement. Subpart 1-12.1—Basic Labor Policies § 1-12.100 General.

The policies and procedures stated in this Subpart 1-12.1 are recommendatory and are for the guidance of executive agencies. § 1-12.101 Labor relations. § 1-12.101-1 General.

(a) With respect to Government contract activities, procurement agencies should maintain and encourage the best possible relations with industry and labor in order that the Government may procure needed supplies and services without delay. All problems arising out of the Government contract labor relations of private contractors, and all communications with labor organizations or Federal agencies relative thereto, shall be handled in accordance with agency procedures.

(b) Procurement agencies should remain impartial in, and should refrain

from taking a position on, the merits of a dispute between labor and private management. No procuring activity should undertake the conciliation, mediation, or arbitration of a labor dispute. $ 1-12.101-2 Contract pricing and ad.

ministration. (a) Nothing in § 1-12.101-1 should be construed to relieve a contracting officer from his responsibility to achieve efficient contract pricing and administration.

(b) Contractor labor policies and compensation practices, whether no not they are provided for in labor-management agreements, are not an acceptable basis for allowance of cost in cost-reimbursement type contracts or for recognition of costs in pricing fixed-price type contracts if and insofar as they result in unreasonable costs to the Government. Part 1-15, particularly 8 1–15.205–6(a), explains that the term "unreasonable costs" includes costs resulting from practices that are discriminatory against the Government or unwarranted in the context of the particular contract work.

(c) In some cases, labor disputes may give rise to work stoppages which cause dela delays in the timely performance of important portant

contracts. The contracting officer should impress on the contractor that he will be held accountable for delays that are reasonably avoidable. It should be emphasized that the standard contract clauses dealing with default, excusable delays, etc., do not relieve the contractor of delays that are not beyond his control or, with respect to delays of subcontractors, that are not beyond the control of both the contractor and the subcontractor. A delay caused by a strike which is an unfair labor practice, as identified in the National Labor Relations Act, as amended (29 U.S.C. 158), and which the contractor could not reasonably prevent can be excused only to the extent that it does not go beyond the point at which a reasonably diligent contractor could resume the delayed performance by taking action toward ending the strike by such means as:

(1) Filing a charge with the National Labor Relations Board so as to permit the NLRB to seek injunctive relief in court;

(2) Recourse to other available Government procedures; or

(3) Use of private boards or organizations for the settlement of disputes.

$ 1-12.102 Overtime, extra-pay shifts, the procurement should use his best and multi-shift work.

efforts (1) to ascertain the extent to § 1-12.102–1 Definitions.

which proposals and quotations are

based on the payment of overtime preAs used in this f 1-12.102, the follow miums and shift premiums, and (2) to ing terms shall have the meanings set negotiate contract prices or estimated forth:

costs which are not based on the pay(a) “Normal workweek” and “normal

ment of overtime premiums or shift workday” mean, generally, a workweek premiums, taking into consideration the of 40 hours and a workday of 8 hours,

practicability of procurement from other respectively. In any area outside the

sources of all or part of the requirement. United States, its possessions, and Puerto (c) All contracts, other than firm Rico, a workweek longer than 40 hours,

fixed-price contracts or fixed-price conor a workday longer than 8 hours, will

tracts with escalation (which do not be considered normal if (1) such work

provide for any labor escalation), should week or workday does not exceed that

provide that payment of overtime prewhich is normal for such area, as de miums and shift premiums shall be termined by local custom, tradition, or

allowed, or considered in pricing, only law, and (2) hours worked in excess of

to the extent approved in accordance 40 in such workweek, or 8 in such work

with $ 1-12.102–4, or as provided in day, are not compensated at a premium

$ 1-12.102–5. rate of pay.

(d) Overtime for which overtime pre(b) "Overtime” means time worked

miums would be at Government expense by a contractor's employee in excess of

should not be approved under a contract the employee's normal workweek or where the contractor is already oblinormal workday.

gated, without the right to additional (c) “Shift premium” means the dif

compensation, to meet the required deference between the compensation paid

livery date. to an employee at the contractor's regu (e) Where overtime premiums or shift lar rate of pay for the base or regular

premiums are being paid at Government work shift and that paid at the regular

expense in connection with the performrate of pay for extra-pay-shift work.

ance of Government contracts, the con(d) “Overtime premium" means the

tinued need therefor should be subject difference between the compensation

to periodic review in accordance with paid to an employee at the contractor's

agency procedures. regular rate of pay for the work period or shift involved and that paid for hours

§ 1-12.102–4 Approvals. worked overtime.

(a) In the three following situations, § 1-12.102–2 Policy.

overtime premiums and shift premiums

at Government expense may be considWhere the cost to the Government

ered proper for approval when determay be affected, contracts should be

mined in writing by the agency head, or performed, so far as practicable, with

his designee or designees, that approval: out the use of overtime, extra-pay shifts,

(1) Is necessary to meet delivery or or multi-shifts, and, in particular, with

performance schedules, and such schedout the use of overtime as a regular

ules are determined to be extended to employment practice. Any required

the maximum consistent with essential overtime, extra-pay shifts, and multi

program objectives; shifts should be limited to the minimum

(2) Is necessary to make up for delays needed for accomplishment of the spe

which are beyond the control and withcific work.

out the fault or negligence of the con8 1-12.102–3 Procedures

tractor and, in construction contracts, (a) To the extent practicable, invita- which result from unforeseeable causes; tions for bids and requests for proposals shall not specify delivery or performance

(3) Is necessary to eliminate foreseeschedules which may be reasonably an able production bottlenecks of an exticipated to necessitate overtime, at tended nature which cannot be elimiGovernment expense.

nated in any other way. (b) In the negotiation of contracts in (b) Approvals should ordinarily be excess of $10,000, the contracting officer, prospective, but may be retroactive consistent with the nature and size of where justified by the circumstances.

313 99–187—69 21

or

(c) Such approvals may be for an individual contract, project, or program, or for a plant, division, or company, as most practicable. § 1-12.102–5 Other authorized over.

time. (a) Approved overtime premiums or shift premiums may be paid for work, without the approval required by $ 112.102-4:

(1) When necessary to cope with emergencies, such as those resulting from accidents, natural disasters, breakdowns of production equipment, or occasional production bottlenecks of a sporadic nature;

(2) When by indirect labor employees such as those performing duties in connection with administration, protection, transportation, maintenance, standby plant protection, operation of utilities, or accounting;

(3) In the performance of tests, industrial processes, laboratory procedures, loading or unloading of transportation media, and operations in flight or afloat, which are continuous in nature and cannot reasonably be interrupted or otherwise completed; or

(4) When lower overall cost to the Government will result.

(b) The cost of such overtime premiums or shift premiums may be allowed, or considered in pricing, only to the extent the amount thereof is reasonable and properly allocable to the work involved. § 1-12.103 Federal and State labor re

quirements. Executive agencies should cooperate, and require contractors to cooperate, to the fullest extent possible, with Federal and State agencies responsible for enforcing labor requirements with respect to such matters as safety, health, and sanitation, maximum hours and minimum wages, equal pay for women, and child and convict labor. § 1-12.104 Meeting manpower require

ments. It is the policy of executive agencies to cooperate with and to encourage contractors to utilize, to the fullest extent practicable, the United States Employment Service (USES) and its affiliated local State Employment Service Offices in matters pertaining to meeting contractors' manpower (labor supply) requirements, including the recruitment

of workers in all occupations and skills both from local labor market areas and through the Federal-State manpower clearance system to staff new or expanding plant facilities. Local State Employment Service Offices are operated in every State and in the District of Columbia, Puerto Rico, Guam, and the Virgin Islands. In addition to providing recruitment assistance to contractors who need and desire it, cooperation with the local State Employment Service Offices will further the national program of maintaining continuous assessment of manpower requirements and resources on a national and local basis. 81§ 1-12.105 Location allowances at un

favorable sites. § 1-12.105–1 Description.

“Location allowances”, sometimes called "supplemental pay" or "incentive pay”, are compensation in addition to normal wages or salaries and are paid by contractors to especially compensate or induce employees to undertake or continue work at locations which may be isolated or in an unfavorable environment. Location allowances include extra wage or salary payments in the form of station allowances, bonuses, extended per diem, or mileage payments for daily commuting; they also include such benefits as contractor-furnished housing. $ 1–12.105–2 Policy.

Payments of location allowances shall be allowed as costs under cost-reimbursement type contracts, or recognized in pricing fixed-price type contracts, only where and so long as the isolation or unfavorable environment of the site makes such payments necessary to the accomplishment of the contract work without unacceptable delays. Whether the site is so isolated, or its environment is so unfavorable, as to require location allowances is to be determined in the light of (1) its location and climate; (2) the availability and adequacy of housing within reasonable commuting distance; and (3) the availability and adequacy of educational, recreational, medical, and hospital facilities. The extent to which compensation includes location allowances is to be determined by comparing it with (a) the contractor's normal compensation policy, including pay scales at his principal operating locations; (b) pay scales of other contractors and concerns operating at or near the site; and (c) compensation paid by other concerns within the same industry for similar services elsewhere. 8 1-12.105–3 Procedures.

(a) Locations at which location allowances are being paid shall be reviewed at least once a year to determine whether such allowances should continue to be allowed or recognized in accordance with $ 1–12.105-2.

(b) Where two or more contracting activities of an agency have concurrent contracts at a single facility and the approval of location allowances by one such activity is likely to affect the performance of, or payments in connection with, contracts of another such activity, the activity exercising jurisdiction over the facility shall coordinate with the other interested activities in applying the policy in § 1-12.105–2 and shall schedule the reviews required by (a) of this § 1-12.105–3. Where two or more facilities are so geographically located that determinations as to location allowances at one may affect the other, the activities involved shall coordinate with each other in applying the policy. The foregoing procedure in this § 1-12.105–3(b) should also be applied where different agencies are known to have concurrent contracts at a single facility or where the action of one agency may affect the interests of another agency.

Subpart 1-12.2—Convict Labor § 1-12.201 Basic requirement.

Pursuant to the policy originally set forth in the Act of February 23, 1887 (18 U.S.C. 436), and in accordance with the requirements of Executive Order 325-A of May 18, 1905, all contracts entered into by any executive agency involving the employment of labor within the United States shall, unless otherwise provided by law, contain a clause prohibiting the employment of persons undergoing sentences of imprisonment at hard labor imposed by State or municipal criminal courts. 81–12.202 Applicability.

The requirement set forth in § 1–12.201 applies, except as stated in this § 1-12.202, to all contracts involving the employment of labor within the United States. The requirement does not prohibit the employment of persons on parole or probation, Federal prisoners authorized by the Attorney General under 18 U.S.C. 4082(c) (2) to work at

paid employment during the term of their imprisonment, or persons who have been pardoned or who have served their terms. Furthermore, the requirement does not apply to contracts:

(a) Subject to the provisions of the Walsh-Healey Public Contracts Act (see Subpart 1-12.6) which contains its own Subpart 1-12.6) which contain requirement that "no convict labor will be employed by the contractor in the manufacture or production or furnishing of any of the materials, supplies, articles, or equipment included in such contract."

(b) For the purchase of supplies or services from Federal Prison Industries, Inc.

(c) For the purchase from any State prison of finished supplies which may be secured in the open market or from existing stocks as distinguished from supplies requiring special fabrication. [29 F.R. 10264, July 24, 1964, as amended at 32 F.R. 10852, July 25, 1967) § 1-12.203 Contract clause.

The contract clause required is as follows:

CONVICT LABOR In connection with the performance of work under this contract, the Contractor agrees not to employ any person undergoing sentence of imprisonment at hard labor. Subpart 1_123_O Subpart 1-12.3—Contract Work Hours

Standards Act (Other Than Con

struction Contracts) § 1-12.300 Scope of subpart.

This subpart deals with the requirements of the Contract Work Hours Standards Act, 40 U.S.C. 327–330, insofar as they apply to contracts other than construction contracts dealt with in Subpart 1-12.4. § 1-12.301 Statutory requirement.

The contract Work Hours Standards Act provides that the wages of every laborer and mechanic employed by any contractor or subcontractor in his performance of work on any contract of the character specified in section 103 of that Act shall be computed on the basis of a standard workday of eight hours and a standard workweek of forty hours. Work in excess of such standard workday or workweek is permissible, provided that the wages of any laborer or mechanic so employed include compensation at a rate not less than one and one-half times the basic rate of pay for all hours worked in any workweek in excess of eight hours in any calendar day or in excess of forty

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