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210 General.The Service Contract Act applies to all contracts and any bid specifications therefor entered into pursuant to negotiations concluded or invitations to bid issued on or after January 20, 1966, the principal purpose of which is to furnish services to United States agencies through the use of service employees.

211 Contracts subject to the SCA.-Whether a particular contract is subject to the SCA and requires submission of a notice is initially decided by the contracting agency. Some types of service contracts previously found to come within coverage of the act are listed in section 4.130 of 29 CFR 4. 212 Information furnished by the notice. Each notice of intention submitted by a contracting agency must contain the following information essential to its processing :

(a) The date on which the agency expects to invite bids or commence negotiations,

(b) The place or locality in which the service is to be performed, (0) A description of the services called for by the contract, and

(d) The numbers and classes of service employees likely to be required for contract performance.

213 Standard Form 98.-Although Standard Form 98 (SF 98) is generally used by a contracting agency to provide notice of its intention to make a service contract, an agency may elect to submit notice by any written form which contains the information requested by the SF 98. Instructions are provided on the reverse side of the form. A contracting agency can purchase supplies of the Standard Form 98, Stock Number 7540–926–8972, from any regional depot of the General Services Administration. The agency completes all items on the face of the SF 98 except the box, “Response to Notice," in the lower right corner. During processing (Chapter 220-269 following), the Branch completes the response box and returns the original notice in a window envelope to the contracting agency.

214 Critical dates.-Under the notice number in the upper right corner, the SF 98 provides space to record the estimated solicitation (or IFB) date. Section 4.5 of 29 CFR 4 requires that any contract in excess of $2,500 contain the minimum wages and fringe benefits specified in any applicable currently effective determination. Paragraph (b) of that section requires an agency to incorporate in the contract any new or revised wage determination received from the Wage and Hour Division up to 10 days prior to the date bids are to be opened (generally 30 days from the specified IFB date) or up to the date negotiations are concluded.

215 Lack of response to notice. If an agency submits timely notice, but does not receive a minimum wage attachment from the Wage and Hour Division before the IFB date, section 4.6(d) of 29 CFR 4 provides that the contractor under the contract shall not pay any of his employees performing work under the contract less than the minimum wage specified by section 6(a) (1) of the Fair Labor Standards Act; however, section 6(e) (2) of the FLSA provides for the rates under FLSA section 6(b) to apply to certain linen supply contracts in the absence of a wage determination ; further, effective October 21, 1969, in the case of contracts to provide nursing home care of veterans under section 620, 38 U.S.C., not less than the wages specified in section 6(b) of the FLSA shall apply.

216 Agency does not submit timely notice.If exceptional circumstances prevent a contracting agency from submitting notice within the prescribed term of 30 days before the IFB date, section 4.4(b) of 29 CFR 4 requires the agency to submit notice as soon as practicable with a detailed explanation to the exceptional circumstances which prevented timely submission. When the Division discovers that notice was not submitted at all, section 4.5(c) of 29 CFR 4 requires the contracting agency to exercise “any and all of its power that may be needed" to include in the contract any wage determination communicated to it within 30 days of the submission of such notice, or within 30 days of the date of the Division's discovery of the failure to submit notice.


AND HOUR DIVISION 220 Processing the notice.—A notice of intention to make a service contract received from a contracting agency is referred to the Branch for evaluation and response (compare flow chart, section 205, above). The Branch dates each incoming notice to corroborate the date the agency prepared and forwarded it. The IFB date on the notice determines the interval of time available to the Branch for developing information on which to base an appropriate response. If the agency has failed to indicate the IFB date, the Branch may telephone the agency for this information, depending on circumstances such as type of service to be performed or number of services employees to be employed.

221 Reviewing the notice.-After administratively processing the incoming notice, the Branch reviews it for any unusual circumstances dictating immediate action or other special handling. Late notices-submitted less than 30 days prior to the IFB date--may require telephone query and immediate processing to accommodate the contracting agency. Staff discussion may be necessary if the IFB date is less than 30 days in advance of the date of receipt of the notice by the Branch (short date) or if the IFB date has already passed (IFB past due) and a considerable number of service employees are expected to be employed under the contemplated contract. Following this preliminary review, the Branch assigns the notice for evaluation.

222 Evaluating the notice.-If the Branch, in evaluating the notice, determines that the SCA does not apply to the contemplated contract, it responds, so advising the agency (see section 240, below). If the SCA is determined to apply, all information furnished by the notice is considered toward taking appropriate action and sending the proper response to the agency. Because of the variety of determination which may apply to service contracts in a single locality, the notice must contain sufficient information to permit accurate response; especially important is the description of the service to be performed under the contract. When additional information is necessary for adequate evaluation, the Branch telephones the procurement official who signed the notice in order timely to transmit response.

223 Responding to the notice.-After evaluation and issuance of any new or revised wage determination, the Branch completes the "Response to Notice" box on the SF 98, advising the agency of any determinations of prevailing wage and fringe benefits applicable to the contemplated contract; records the date of transmittal; and returns the original copy of the notice to the agency. For contracts determined to be subject to the SCA, the Branch responds either (a) that no determination has been issued which applies to the contract-Response B, or (b) that a copy of an existing determination applicable to the contract is attached to the returned notice-Response A. The evaluation performed by the Branch and the various responses to the notice which it may return to the contracting agency are elaborated upon in following sections.

230 Evaluating the notice. Following the Branch's preliminary review of an incoming notice of intention to make a service contract, the Branch evaluates the notice to determine if the SCA applies to the contract; if so, it screens the notice to discover whether an applicable wage determination can be timely returned in response to the agency. While standard Branch procedures in processing notices SF 98 are outlined below, unique contracting situations constantly require the development of new approaches to arrive at appropriate responses within the purview of the Act.

231 Screening the notice.-Having determined that the SCA applies to a contemplated contract, the Branch screens the incoming notice in terms of the 4 items of information listed in section 212, above-IFB date, locality of performance, type of service, and number and classes of service employees—as well as the 4 further items listed below :

(a) Agency submitting the notice;

(b) Type of contractor, if any, currently performing on the predecessor contract;

(c) Labor union, if any, involved in the predecessor contract, and

(d) Whether the agency knows of an existing determination applicable to the predecessor contract. Screening entails checking the existence of a wage determination applicable to an incoming notice. As a result of screening, the Branch decides to respond to the agency either with or without an applicable wage determination. This decision is partially conditioned on the immediate or early availability of probative data concerning the wages and fringe benefits prevailing in the locality and the time available to develop data not readily at hand. Every current wage determination states the locality and type of service contract to which it supplies--for example. “State of Maryland, County of Prince Georges ... Employed on con

tracts for cleaning services”-followed by the occupational classes of service employees subject to determined wage rates. The Branch maintains an index of current wage determinations by locality, type of service, wage-determination number, and date of issue. In consequence, the screening function consists first of comparing the locality specified by the notice with the index of localities for which current wage determinations are applicable.

232 Locality. The place of performance of a service contract determines the locality wage determination which applies. Basically, the bounds of a locality are determined by the area covered by wage data on which the wage determination is based.

(a) Ordinarily, the locality is a precise geographic area consisting of several counties. Typically, the locality conforms to a Standard Metropolitan Statistical Area as determined by the Bureau of the Budget.

(6) Some wage determinations are issued for a locality that includes all of a state, rather than a county or counties within a state. Such determinations have been applied to service contracts for over-the-road hauling of mail and for forestry and land management services.

(c) A notice for transportation services such as mail hauling or moving and storage may specify a route between two discrete localities. The applicable wage determination will be one for the locality in which the headout point lies.

(d) The place of performance may be unknown to the contracting agency when it issues its invitation for bids from contractors. In this case, an applicable wage determination specifies the locality in which is located the Federal installation for which the service will be performed. For example, wage determinations for laundry and cleaning services or those for the maintenance and repair of automotive vehicles contain the clause, “Employed on contracts for ... services for Federal installations located in the above LOCALITY.

(e) In rare cases, a wage determination may be issued to apply only to a specific installation, or enclave, and is not applicable to the frequently greater geographical area within which the installation may be situated. (A wage determination issued to apply to a Standard Metropolitan Statistical Area excludes from its scope of application any determination issued to apply only to a specific installation, or enclave, within that SMSA.) See section 303(b) on limitations of enclaves.

233 Type of service.--In the next step of screening, the Branch compares the type of service specified by the incoming SF 98 against the index of current wage determinations.

(a) Where an agency's description of the type of service to be performed does not precisely agree with the language of an apparently applicable wage determination, the Branch may need to clarify the matter with the agency's procurement officer.

(0) Although a current wage determination may provide rates for a class of employees specified by the incoming SF 98, the service to be performed may render that wage determination inapplicable. For example, even though a notice specifies the class of janitor, a current wage determination which lists the class of janitor, porter, cleaner in the locality for services described as "Employed on contracts for cleaning services," would not be applied to janitors “Employed in the maintenance and operation of ... Air Force Base," since the specified service is not that listed on the wage determination.

234 Occupational class of service employees.

(a) A determination of prevailing wage rates and fringe benefits is not responsive to the notice required of a Federal contracting agency unless it lists at least one or more classes of service employees to be employed on the contemplated contract (sections 4.5(b) and 4.6(b) of 29 CFR 4). For example, if the incoming SF 98 specifies cleaning services, but restricts employee classes to window washer, a wage determination listing only the class of janitor, porter, cleaner may not be applied, because it fails to determine the prevailing wage rate for window washer. On the other hand, should the notice specify three classes of employees-namely, window washer, floor waxer, and janitor--that same wage determination could apply to the contemplated contract insofar as it lists a wage rate for at least one of the occupational classes specified by the agency's notice.

(6) If a class of service employees specified by the notice (such as custodiál worker) can be reasonably construed to be the same class stated on a wage determination (such as janitor) the wage determination may be applicable.

(c) If an existing wage determination applicable to the contemplated contract provides rates for some, but not all, of the classes of service employees to be employed, sertion 4.6(b) of 29 CFR 4 requires the establishment of conformable rates.

235 Courses of action leading to response.-In summary, the Branch's processing of an incoming SF 98 results in its selection of one out of only six possible courses of action all of which eventuate in ultimate response to the contracting agency:

“RESPONSE: SCA IS INAPPLICABLE": (1) If the contemplated contract is subject to acts other than the Service Contract Act, it may be exempt from SCA. The Branch requests the agency to review the primary purpose of the contract where this appears to be the case.

"RESPONSE B: NO WAGE DETERMINATION APPLICABLE": (2) "NO DATA AVAILABLE FOR NEW WD.” If no current wage determination applies to the incoming SF 98 and adequate data on which to base issuance of a new applicable wage determination cannot be timely developed, the Branch responds by checking Response B on the original notice SF 98 and returning it to the agency 5 days before the specified IFB date.

(3) "DO NOT ISSI'E NEW WD NOW." A new wage determination may not be issued under some circumstances although data on which to issue a new wage determination appear, at first, to be available.

(A) For example, the incoming notice might impinge on legal or policy matters under consideration; (B) Further analysis may raise questions:

(i) Whether the wage and fringe benefit data alleged to prevail in a locality are actually paid to a majority of workers in a specified occupational class, or

(ii) Whether available survey data noticeably depart from established employment patterns; or (C) Again, the Branch may simply have insufficient time to prepare a complex time-consuming determination affecting relatively few employees prior to the specified IFB date.

In such instances as these, the Branch responds as in the second course of action described above (see section 250, below). "RESPONSE A : ATTACHED WAGE DETERMINATION APPLICABLE"

(see section 260, below): 4. "NEW WD APPLICABLE.” If no applicable wage determination exists, but probative data upon which to base issuance of a new determination are readily available, the Branch issues the WD. The new WD is attached to the original SF 98 and the Branch responds by checking Response A on the notice and returning it to the agency 5 days before the specified IFB date (see section 261, below).

5. "REVISED WD APPLICABLE.” Although a current wage determination is discovered to apply to an incoming SF 98, more recent supporting data may be suitable for revising the current WD to bring it up to date. In this instance, the Branch revises the WD and responds as in (e) (1) described above (see section 262, below).

6. “CURRENT WAGE DETERMINATION APPLICABLE." If a current wage determination applies to the incoming SF 98 and none of the preceding courses of action is taken, the Branch responds as in (4) above attaching the applicable current WD to the original notice (see section 263, below).

These possible elections following processing, review, and evaluation are more fully described in following sections of this chapter.

240 Response: Service Contract Act is inapplicable.-In evaluating an incoming SF 98, the Branch considers whether the contemplated contract and work performed under it are covered by the Service Contract Act. For example, the SCA exempts work subject to the PCA and contracts subject to DBRA.

241 Basic exemptions.—The Branch typically encounters four basic situations in which the Service Contract Act is found to be inapplicable to a contemplated contract:

(a) Work under the contract may be covered by the Public Contracts Act, manufacture or furnishing of materials, supplies, articles, or equipment, or,

(0) The contract may be covered by the Davis-Bacon Act-construction work. (c) The contract may be otherwise exempt under SCA section 7.

(d) The contract may not be principally for services performed by service employees.

242 Mutliple coverage.-The Branch reviews questions of coverage under 2 or more statutes. Should it find that a contracting agency has erroneously submitted an SF 98 for a contract or work not within coverage of the SCA, it notifies the agency, requesting further review. In transmitting such a request, the Branch retains copies of correspondence pending the agency's reply. If the contract and work under it, however, are clearly exempt from the SCA, the Branch so advises the agency in referring contract notification to the appropriate office.

250 SF 98 Response B: no wage determination applicable.-In screening the incoming SF 98, the Branch initially decides whether a current wage determination is applicable to the contemplated contract and, if not, whether pursuit of data upon which a new determination can be based is justified. This latter decision depends upon such factors as the number of service employees to be employed, the occupational classes specified by the notice, and the service to be performed.

251 Decision to issue wage determination. If relevant data are not immediately available in-house, the Branch may decide that pursuit of data pertinent to the issuance of a new wage determination is justified in the following cases :

(a) If the contract calls for the employment of a large number of service employees;

(6) If the contract calls for the employment of a number of skilled workers;

(c) If the contemplated service is in a traditionally unionized sector, or;

(d) If wage data are available or can be obtained. 252 Decision not to issue wage determination.The Branch may conclude that pursuit of data upon which to issue a new wage determination is not justified in the following cases :

(a) If no wage data are readily available. or

(b) If only a few employees will be employed in the performance of the contract. 253 Response to notice. If no wage determination applies to the contemplated contract and if, after further review, the Branch decides not to issue a new applicable wage determination, it responds by checking Response B on the SF 98 and returning it to the agency 5 days before the specified IFB date. The reverse side of the SF 98 explains that, in the absence of an applicable determination, not less than the minimum rate under section 6(a) (1) of the Fair Labor Standards Act-$1.60 an hour since February 1, 1968--must be paid to service employees under the contract. (If no wage determination applies to a contract for linen supply services as defined in section 4.160 (4) (d) of 29 CFR 4, the Branch informs the agency with a special form letter.) If the contracting agency has not submitted notice by SF 98, the Branch returns a copy of the agency's advice with a standard form letter explaining that no wage determination applies.

260 SF 98 Response A: wage determination applicable. When the Branch checks Response A of the SF 98, it advises the agency of the applicable wage determination, its number, and that it is attached for inclusion in the invitation for bids and subsequent contract. (If some form of notice other than SF 98 has been submitted, the Branch returns a copy of the agency's advice with a standard form letter to inform the agency.) The applicable wage determination attached to the outgoing SF 98 may be either :

(a) A new wage determination,
(b) A revised wage determination, or

(c) A current wage determination.
261 SF 98 Response A: new wage determination applicable.

(a) Incoming notice. All incoming SF 98's to which no exisiting wage determination applies, but for which the Branch has tentatively decided to pursue issuance of a new applicable wage determination, are similarly processed. A notice is initially reviewed to determine whether data are readily available on which to base an applicable WD covering service employees under the contemplated contract. The Branch makes every attempt to secure relevant data if a substantial number of service employees will be employed.

(b) Relevant data available.-Relevant data readily available within the Branch generally include:

(1) Wage surveys-conducted by the Bureau of Labor Statistics, states, and other agencies—that typically show wages for employees in janitorial,

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