Price increase modification for new wage determination on IDIQ and task order

[jimmym]

Scenario: A 5-year IDIQ contract is awarded on 1/30/2021 which is subject to the services contract act and includes the current wage determination for the county in which all work is being performed. All work is performed at one location; however, the location has many buildings. The unit pricing is based on square footage of the buildings. There is only one labor category which is performing all the work. On the same day as award of the IDIQ contract, a task order is issued for buildings 1-12 for a 1-year period of performance. One year later, on 1/30/2022, a task order is issued for buildings 13-24 for a 1-year period of performance which includes the current wage determination. The labor rate has increased since the wage determination include don the IDIQ contract. Following this, the contractor submits a request for equitable adjustment due to the increased labor rate in the wage determination and provides payroll information from the previous year.

Questions:

1. Should the CO grant the request for equitable adjustment?

2. If the request is appropriate, and an increase is determined, how should the increase be applied? By modification to the first task order, the second task order, or the IDIQ contract?

[Retreadfed]

What type of contract/TO, e.g., FFP, CR, T&M, is involved?  Is either FAR 52.222-41 or 52,222-43 in the contract?  If so which one?  What has the contractor asked to be equitably adjusted?  What is the basis of the contractor's request?

[jimmym]

FFP. Clauses 52.222-41, 52.222-42 and 52.222-43 are included. The contractor believes they are entitled to an increase based on the difference in the labor rate for the labor category from the first to the second wage determination.

[C Culham]

3 hours ago, jimmym said:

FFP. Clauses 52.222-41, 52.222-42 and 52.222-43 are included. The contractor believes they are entitled to an increase based on the difference in the labor rate for the labor category from the first to the second wage determination.

In concert with the clauses and what they state consider this as well.....

22.1007 Requirement to obtain wage determinations.

The contracting officer shall obtain wage determinations for the following service contracts:

      (a) Each new solicitation and contract in excess of $2,500.

      (b) Each contract modification which brings the contract above $2,500 and-

           (1) Extends the existing contract pursuant to an option clause or otherwise; or

           (2) Changes the scope of the contract whereby labor requirements are affected significantly.

      (c) Each multiple year contract in excess of $2,500 upon-

           (1) Annual anniversary date if the contract is subject to annual appropriations; or

           (2) Biennial anniversary date if the contract is not subject to annual appropriations and its proposed term exceeds 2 years-unless otherwise advised by the Wage and Hour Division.