LABOR

CONTRACT TERMINATION-DEBARMENT (MAY 1972)

A breach of the "Contract Work Hours Standards Act-Overtime Compensation" and the "Subcontracts" clauses of this contract may be grounds for termination of the contract, and for debarment as provided in 29 CFR 5.6.

12.403-4 Contracts With a State or Political Subdivison. In the case of construction contracts with a State or political subdivision thereof, the contract clauses required by 12.403-1 shall be inserted therein but shall be prefaced by the following provision:

The Contractor agrees to comply with the requirements of the Contract Work Hours and Safety Standards Act and to insert the following clauses in all subcontracts hereunder with private persons or firms. (MAY 1972)

12.404 Administration and Enforcement. 12.404-1 General.

(a) Preconstruction Conference or Letter. The contracting officer administering the contract shall ascertain that the contractor is fully aware of and understands an employer's responsibilities imposed by the contract labor standards provisions by conducting a preconstruction conference or, as an alternate method, by submitting a preconstruction letter to the contractor. When a preconstruction conference is held, a memorandum containing a summary of the information and guidance given to the contractor shall be placed in the contract file.

(b) Examination of Records. The contracting officer administering the contract shall initiate such examinations into the records and activities of the contractor and his subcontractor(s) as are necessary to ensure full compliance with the applicable labor statutes and labor standards provisions in this Subpart.

12.404-2 Wage Determinations.

(a) General. The wage determination, issued by the Department of Labor pursuant to the Davis-Bacon Act, is a schedule of the minimum hourly rates of wages to be paid laborers and mechanics employed by the contractor and his subcontractors performing work called for by the contract. It normally includes all the classifications of laborers and mechanics expected to be employed on the work. There are three types of determination: area determinations, limited area determinations, and individual determinations.

(1) Area (54A) Determinations. Area (54A) Determinations provide wage rates for all kinds of construction contracts which may be awarded at an installation or within a given geographical area (usually a county) during the 120-day life of the determination. This type of determination is issued only for installations where continuing construction activity is anticipated. Area determinations must be renewed on a continuous basis by submission of Department of Labor Form DB-11, "Request for Determination," to the Department of Labor approximately 30 days prior to the expiration of each current area determination (see (c)(2) below).

(2) Limited Area (54A) Determinations. In some States, the Department of Labor does not include in the area type determination wage rates applicable to heavy or highway construction. In these States, the wage rates issued are for all classifications for either "Building Construc

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tion" only, or "Building, Utilities, and Incidental Paving." This type of determination is known as a limited area determination; where the Department of Labor issues this type of determination, the requesting office must submit requests for individual determinations for heavy and highway construction projects as described in (3) below. This type of determination is applicable in the following States:

(3) Individual Determinations. Individual determinations are provided by the Department of Labor for a single contract. Such a determination must be obtained for each contract subject to the Davis-Bacon Act unless an Area (54A) Determination is applicable. The classifications of laborers and mechanics in individual wage determinations are limited to those classes employed in the type of work required by the contract, as indicated in the request.

(b) Limitations. Wage determinations initially issued shall be effective for 120 calendar days from the date of such determinations. If such a wage determination is not used in the period of its effectivness, it is void. If it appears that a wage determination may expire between bid opening and award, a new wage determination should be requested sufficiently in advance of the bid opening to assure receipt prior thereto. However, when due to unavoidable circumstances a determination expires before award and after bid opening, the Solicitor of Labor upon a written finding to that effect by the Administrator or his representative in individual cases, may extend the expiration date of a determination whenever he finds it necessary and proper in the public interest to prevent injustice or undue hardship or to avoid serious impairment in the conduct of Government business. Whenever it is considered necessary to extend the expiration date of a wage determination, a proposed finding shall be prepared for the signature of the Assistant Administrator for Procurement and sent with supporting documentation to the Office of Procurement, NASA Headquarters (Code HP).

(c) Processing Requests.

(1) Responsibility for Obtaining Determinations. The Office of Procurement is responsible for obtaining from the Secretary of Labor and for furnishing to the particular installation concerned all determinations of prevailing wage rates under the Davis-Bacon Act required in the awarding of construction contracts of NASA.

(2) Preparation of Requests. For those installations covered by area determinations, requests for wage rates on Department of Labor Form DB-11 will be prepared by the Office of Procurement and submitted to the Department of Labor thus providing, in effect, continuous wage rate coverage. Requests for individual wage determinations will be submitted by the installation concerned on Department of Labor Form DB-11 (in

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original and two copies) to the Office of Procurement, NASA Headquarters (Code HP) at least 30 calendar days before required for the advertisement or negotiation of the contract for which the determination is sought. In preparing the request, only the original copy of the Department of Labor Form DB-11 will be typed with a reversed carbon which will make an impression on the back of the form. The original will be submitted to the Department of Labor by NASA Headquarters. For area determinations, the description of the work will be: Area (54A) Determination- Building, Heavy and Highway Construction. Do not check any classifications as all classifications are contained in the area type determinations. In those States where the Department of Labor issues a limited 54A Area Determination, the description will be: Area (54A) Determination-For Building Construction Only or Building, Utilities, and Incidental Paving. In these cases, a Department of Labor Form DB-11 must be submitted on an individual basis for determinations for Heavy and Highway Construction Projects, with the work to be accomplished in detail. For individual determinations, the description of the work shall be sufficiently detailed to enable the Department of Labor to determine that the work is one of the three categories; namely, Building, Heavy or Highway Construction. In the block entitled "Location," the name of the municipality nearest to the site of the work will be inserted. The State and County in which the work is to take place will be inserted in the spaces provided. Classifications of laborers and mechanics needed to perform the work will be checked by typed X. Needed classifications which are generally used in the area but which do not appear on the Department of Labor Form DB-11 will be typed in the blank spaces. The Apprentice Schedule is to be left blank as the Department of Labor will furnish these rates.

(d) Use of Wage Rate Determinations.

(1) The specifications of every contract subject to the Davis-Bacon Act shall include a copy of a current wage rate determination. If the wage rate determination is not available when invitations for bids are issued, the specifications shall contain a statement that wage rates will be supplied by adgenda to the specifications. Contracting officers shall not open bids on procurements subject to the Davis-Bacon Act until the requested determination of wage rates has been incorporated in the specifications.

(2) Wage rates properly included in the contract at the time of award are applicable to the contract for its duration, except as specified in (b) below. These same rates may be used for additional or new work not included in the specifications if an area determination was used in the invitations for bids or requests for proposals and that determination is still in effect at the time of change. If the area determination has expired or if an individual determination was used, a new wage determination must be used for such new or additional work unless it is clear that the new or additional work is so much a part of the work originally contracted for that it is reasonably impossible of performance by other than the original contractor. (An apparent probability that the new work may be done more conveniently or even at less expense by the original contractor does not in itself justify use of the original determination for such work. The original determination should be used for new work only if the new work does not reflect a change or modification which materially alters the scope or character of the original contract requirements and is so closely

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related to the original work, both in nature and in timing, that it cannot reasonably be regarded as a separate and distinct undertaking.)

a. Fixed-Price Contracts (Formally Advertised or Negotiated). Once a contract is awarded, the wage rates contained in the specifications are the minimum rates that can be paid by the contractor or his subcontractors during the life of the contract.

b. Cost-Reimbursement Type, Time and Material, and Labor-Hour Contracts and Subcontracts. The wage rates established for and included in cost-reimbursement type prime or subcontracts (including time and material contracts and labor-hour contracts), according to the DavisBacon Act, are the minimum rates that can be paid during the life of the contract. Reimbursement to contractors and subcontractors holding the foregoing types of contracts for wages paid to laborers and mechanics are based on this wage schedule; all applications of prime and subcontractors to use higher wage rates require specific approval by the contracting officer. The contracting officer's approval shall be based upon substantiating data in support of the contractor's request, such as: proposed wage rates were established as a result of bona fide collective bargaining in which the contractor participated or to which he adheres as a general practice or as a result of membership in contractor's organizations; proposed wage rates have approval of any existing wage-stabilizing body established pursuant to Federal law; or payment or wages at higher rates is required to man the job. Subcontracts awarded pursuant to a costreimbursement type, time and material, or labor-hour contract shall include wage rates prevailing at the time of the subcontract award, except where the subcontracted work is included in the specifications of the prime contract and is a part of the particular work for which the wage rate determination attached to the prime contract was obtained.

(e) Modification and Superseding Determinations. During the 120-day life of a determination, the Department of Labor may issue a modification thereto, changing the wage rate for one or more classifications or adding or deleting a classification; or the Department of Labor may issue a new determination which entirely supersedes the original determination for the duration of the 120-day period. The word "modification" as used in this paragraph 12.404 includes new or superseding wage determinations. Modifications do not change the expiration date of the original determination. Modifications by the Secretary of Labor of an original wage determination shall be made part of the proposed contract if received prior to the award of the contract, provided that, in a formally advertised procurement, any modification received less than 10 calendar days before the opening of bids may be disregarded.

(f) Posting. The contracting officer shall ascertain that a copy of the wage determination is kept posted at the site of the work in a prominent place where it can be easily seen by the workers.

12.404-3 Additional Classifications. If any laborers or mechanics not listed in the wage determination attached to the contract are to be employed, their classifications and minimum wage rates shall be established by the contractor or subcontractor, with the approval of the contracting officer, conformably to the attached wage determination. A report of any such determination shall be transmitted to the Secretary of Labor. If the interested parties cannot agree upon any such additional classification and wage rate, the matter accompanied by the recommendation of the

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contracting officer shall be referred via the Assistant Administrator for Procurement to the Secretary of Labor for final determination.

12.404-4 Apprentices.

(a) In accordance with Section 5.5(a)(4) of the Department of Labor Regulations (29 CFR Part 5) as implemented by Memorandum No. 59 issued on June 24, 1964 from the Office of the Solicitor, the Labor Department will no longer list apprentice rates on wage determinations under the Davis-Bacon Act and related acts. Future determinations will contain the following notation:

"Before using apprentices on the job, the contractor shall present to the Contracting Of ficer written evidence of registration of such employees in a program of a State apprenticeship and training agency approved and recognized by the U.S. Bureau of Apprenticeship and Training. In the absence of such a State agency, the contractor shall submit evidence of approval and registration by the U.S. Bureau of Apprenticeship and Training.

"The contractor shall submit to the Contracting Officer written evidence of the established apprentice-journeyman ratios and wage rates in the project area, which will be the basis for establishing such ratios and rates for the project under the applicable contract provisions." (November 1964)

(b) Any employee of a contractor listed on a payroll at an apprentice wage rate, who is not registered as an apprentice and within an established apprentice-journeyman ratio, as provided in (a) above, shall be paid the wage rate determined by the Secretary of Labor for the classifi cation of work he actually performed.

12.404-5 Subcontracts. The contracting officer shall obtain a list of all subcontracts, together with a description of the work to be performed thereunder, and such list shall be kept current during the performance of the contract.

12.404-6 Payrolls and Statements.

(a) Submission. Within 7 calendar days after the regular payment date of the payroll week covered, the prime contractor will submit and cause all his subcontractors to submit through him to the contracting officer, copies of certified weekly payrolls showing all laborers and mechanics engaged on the contract at the site of the work, including the name and address of each employee, his correct classification, daily and weekly number of hours worked, rate of pay, deductions made, and actual wages paid. Each payroll shall contain or be accompanied by a statement of the contractor (or subcontractor) that he has complied with the labor standards provisions of the contract. The receipt of these payrolls and statements is a condition precedent to final payment under the contract. Contracting officers should encourage contractors to make use of optional payroll Forms SOL-184 and 185, developed by the Department of Labor for voluntary use on Federal construction contracts subject to the DavisBacon Act and related Acts.

(b) Payroll Deductions.

(1) No payroll deductions are authorized except as follows:

(i) where required by Federal, State, or local statute or ordinance to be made by the employer from the wages earned by the employee;

(ii) bona fide prepayment of wages without discount or interest; (iii) deductions required by court process, provided that the contractor or subcontractor will not be permitted to make such a deduction in favor

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