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Regarding Retreadfed's third question, FAR Clause 52.222-43(f) states:

“The Contractor shall notify the Contracting Officer of any increase claimed under this clause within 30 days after receiving a new wage determination unless this notification period is extended in writing by the Contracting Officer.”

The word “receives” begs the question “from whom?”

Since it doesn't say, how do you think it ought to be interpreted?

BTW, do you know what "begs the question" means? Hint: It does not mean raises the question.

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An interesting anecdote regarding contracting officers not including revised WDs in a contract when an option is exercised. I once had to deal with the situation where a DoL contracting officer failed to do so. When asked about incorporating the revised WD, he responded that the WD incorporated into the contract at award was the WD that applied for the life of the contract.

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am I the only one who posts here who has ever worked for a fed contractor in a position covered by an Area Wage Determination ?

Back in 1994, when the world was a lot less connected, it was the hourly workers who found out when there was a new Wage Determination, and the workers would tell the Contractor.

Now with the WD's on the web, that must still be the case.

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Since it doesn't say, how do you think it ought to be interpreted?

BTW, do you know what "begs the question" means? Hint: It does not mean raises the question.

Oh, but sadly it has come to mean just that...

From Wikipedia (http://en.wikipedia.org/wiki/Begs_the_question):

"Despite having "long been condemned by usage commentators as incorrect or sloppy",[1][6] some authorities consider the use of "begs the question" as a way of saying "raises the question" or "evades the question" to be no longer mistaken because it has attained such wide usage.[7]"

...in similar fashion to the prefixes "semi" and "bi" when used to decribe recurring events. They've become so diluted with misuse as to be useless.

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Since it doesn't say, how do you think it ought to be interpreted?

BTW, do you know what "begs the question" means? Hint: It does not mean raises the question.

That really rips my contract. I always thought that it meant to "raise the question" but I see my usage is incorrect. Interestingly, the prevalence of misuse is so significant that M-W Dictionary now includes both meanings.

Back to the topic at hand, my interpretation of FAR Clause 52.222-43(f) is that the 30-day timer would start from when the Contractor knew or should have known about the WD. Part © of that Clause talks about where the WD comes from: "[t]he wage determination, issued under the Service Contract Act of 1965, as amended, by the Administration, Wage and hour Division, Employment Standards Admiinstration, U.S. Department of Labor... shall apply to this contract." Therefore, it is my interpretation that the WD should be received by the Contractor from the DOL, not the Contracting Officer. This interpretation would mean that the Contractor would have the duty to notify the Contracting Officer within 30 days of DOL issuing a new WD, not 30 days of the contract anniversary or when the Contracting Officer unilaterally incorporated the WD into the contract. I could not find any case law surrounding this, however.

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Guest Jason Lent

FAR 22.1007 states:

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.

© 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.

Being AF, I have to lean on what the FLSA Price Adjustment Guide (http://ww3.safaq.hq.af.mil/shared/media/document/AFD-121009-027.pdf) says (as a guide, of course)

3.0 SERVICE CONTRACT ACT WAGE DETERMINATIONS

3.1 Requirement. Contracting Officers incorporate a new or revised WD into an existing contract when required by FAR 22.1007, provided a new or revised WD is received or available timely in accordance with FAR 22.1012. New or revised WDs are incorporated into existing contracts at:

• option exercise;

• extension award;

• the annual anniversary date of multiple year contracts subject to annual funding; and

• the biennial anniversary date in multiple year contracts not subject to annual funding

New or revised WDs are always effective the first day of the new contract period, even though the WD may be dated several months prior to incorporation. A WD is not effective for a contract merely because it is published on WDOL.gov.

So, any of those times you'd exercise an option, do an extension, or on the annual anniversary (annual funding) or biennial anniversary (not subjecto to annual funding), you'd incorporate the current area wage determination into the contract as part of your option mod. The contractor has their 30 days to come in to request a price adjustment after receiving the modification to exercise the option (which incorporates the current wage determination).

I'm not sure about other agency procedures, since the second half of my "conclusion" is based on an agency-specific guide.

EDIT: I think the weakest part of the guide's, err, guidance, is that it assumes "obtain wage determinations..." to mean "incorporate a new or revised WD....".

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metteec, FAR 52.222-41© says " Each service employee employed in the performance of this contract by the Contractor or any subcontractor shall be paid not less than the minimum monetary wages and shall be furnished fringe benefits in accordance with the wages and fringe benefits determined by the Secretary of Labor, or authorized representative, as specified in any wage determination attached to this contract." How does the contractor's obligation to pay its employees in accordance with the WD attached to the contract square with your interpretation that the contractor receives the WD from DoL? Would DoL modify the contract to attach a new WD so the contractor could comply with 52.222-41?

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OMG! I'm just a Financial Policy wonk but do you folks always debate the meaning of words like this? I'm going to think this through for you like an auditor would. If the wording on ANYTHING in the CO file uses the words attached or attachment, it better be in the file. If it isn't, your files are incomplete and I would write it up as such. When areas that are legally enforceable aren't complete, it opens the door for problems. Please don't be my problem. If you come back to me for money, you have become my problem. Let's assume that putting everything that might ever come up in the master file is the right thing to do.

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OMG! I'm just a Financial Policy wonk but do you folks always debate the meaning of words like this?

Yes. We are contracting people, words are important to us, and we know that they are often vague, ambiguous, or specially defined by regulation or trade usage.

If the wording on ANYTHING in the CO file uses the words attached or attachment, it better be in the file. If it isn't, your files are incomplete and I would write it up as such.

Well, now, what do you mean by "in the file"? Do you mean physically? If so, then your thinking is faulty, because "attachment" does not necessarily mean physically. See, for instance, 48 C.F.R. 204.7101 (the DFARS), "Definitions":

Attachment means any documentation, appended to a contract or incorporated by reference, which does not establish a requirement for deliverables.

Emphasis added. Now, by that official definition, an attachment need not be physically "in the file". So, let's debate the meaning of your words. What do you mean by "in the file"? If you say that it means physically in the file, please cite some regulation in support of your position. If you cannot, then you are just another ignorant, smartypants auditor who doesn't know what he or she is talking about, and I do not concur in your unsupported finding. I am not your problem -- you are.

Of course, if by "in the file" you included incorporation by reference, and I referenced the document in my file, then neither one of us is a problem to the other.

So -- what did you mean by "in the file"?

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Just curious. Is it possuible to find an SCA wage determination for a specific project on-line from the Dept. of Labor? No ulterior motive...

Thanks.

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Here is the website. http://www.wdol.gov/sca.aspx . Click on Selecting Wage Determinations to get drop downs.

Thanks for the citation, Boof.

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. . . A reviewer would probably say that an admin change as defined in FAR 43.101 would not be appropriate, because the WD affects the substantive rights of the parties.

It seems to me that the issuance (by DoL) of the new WD may affect the rights and obligations of the parties, but now, once it has been issued, what effect does attaching it to a mod have? If the contractor has to pay according to the new WD whether or not it's attached to the mod ("contract"), then isn't there a good argument that its attachment to the mod is "administrative"?

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There is no such good argument. Attaching the wage determination is a contractual act that affects the rights of the parties. The mere issuance of a wage determination does not necessarily make it binding, contractually or otherwise. For one thing, a CO or other parties might challenge a wage determination pursuant to 29 C.F.R. 4.11. The Administrator of the Wage and Hour Division might toss it. The contractor is unquestionably bound when it's in the contract.

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There is no such good argument. Attaching the wage determination is a contractual act that affects the rights of the parties. The mere issuance of a wage determination does not necessarily make it binding, contractually or otherwise. For one thing, a CO or other parties might challenge a wage determination pursuant to 29 C.F.R. 4.11. The Administrator of the Wage and Hour Division might toss it. The contractor is unquestionably bound when it's in the contract.

If that is the case, then the Contracting Officer would need to incorporate every WD bilaterally. I do not think that is necessary because even if the Contractor were not to sign the modification, or the Contracting Officer forgot to attach the WD, the DOL would compel the agency and Contractor to accept the revised wage determination, and possibly apply the WD retroactively (see 29 C.F.R 4.5©):

Where the Department of Labor discovers and determines, whether before or subsequent to a contract award, that a contracting agency made an erroneous determination that the Service Contract Act did not apply to a particular procurement and/or failed to include an appropriate wage determination in a covered contract, the contracting agency, within 30 days of notification by the Department of Labor, shall include in the contract the stipulations contained in § 4.6 and any applicable wage determination issued by the Administrator or his authorized representative through the exercise of any and all authority that may be needed (including, where necessary, its authority to negotiate or amend, its authority to pay any necessary additional costs, and its authority under any contract provision authorizing changes, cancellation, and termination). With respect to any contract subject to section 10 of the Act, the Administrator may require retroactive application of such wage determination. (See 53 Comp. Gen. 412, (1973); Curtiss-Wright Corp. v. McLucas , 381 F. Supp. 657 (D NJ 1974); Marine Engineers Beneficial Assn., District 2 v. Military Sealift Command , 86 CCH Labor Cases ¶ 33,782 (D DC 1979); Brinks, Inc. v. Board of Governors of the Federal Reserve System , 466 F. Supp. 112 (D DC 1979), 466 F. Supp. 116 (D DC 1979).) (See also 32 CFR 1-403.)

If neither party has the authority to refuse, is incorporation of the WD truly affecting the rights of the parties?

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If neither party has the authority to refuse, is incorporation of the WD truly affecting the rights of the parties?

It's not a matter of "authority" to refuse. It's a matter of right to refuse. Either party can refuse to comply with an order of the DOL if it thinks that the DOL has acted unreasonably or unlawfully. Such a party would take a risk that it is wrong. Whether it could properly refuse might ultimately have to be determined by the courts. Is it your impression that the DOL has never lost a case? If so, do some reading.

The DOL wrote and prescribes the use of an SCA clause. FAR merely quotes the clause and implements the DOL prescription. The clause specifies the rights and obligations of the parties under the SCA and the DOL's implementing regulations. The clause specifies special dispute procedures. In effect, the clause makes the Administrator of DOL's Wage and Hour Division a contracting officer for the purposes of SCA enforcement.

When an agency CO attaches a new wage determination to a contract, he or she is changing the obligations of the contractor and the rights of the government. The DOL is not a dictator. The SCA clause prescribes contractually binding administrative dispute settlement procedures, which can be enforced in federal court. See 29 CFR Part 6. The decisions of the DOL are subject to court review under the Administrative Procedures Act.

When a court reads a clause or a WD into a contract by operation of law, all it is doing is supplying a required, but missing contract term, which is standard contract law.

Finally, it does not follow that because the addition of a wage determination affects the rights of the parties that the WD must be added bilaterally. I think that bilateral modification would be best, but the SCA clause can be interpreted to permit a CO to do it unilaterally. Many contract clauses allow the government to unilaterally alter a contractor's obligations and rights.

It's not a good idea for COs to think too much about inclusion or enforcement by operation of law. It's best to simply follow the FAR and think contractually.

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Vern, you have mentiioned a couple of times that revised WDs are incorporated into a contract containing 52.222-43 by operation of law when an option is exercised under that contract. I have limited research capabilities (what is available online without a subscription). Using my limited capabilities, I have not been able to find any appeals board or court decision that has addressed this question. Are you aware of any such decisions using your research capabilities?

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Retread:

The leading case is Miller's Moving Co., ASBCA 43114, 92-1 BCA P 24707. In that case the contractor did not pay specified wages and fringes arising out of an applicable revised wage determination that had not been attached to the contract and that the contractor knew nothing about. The DOL ordered the contracting officer to withhold $18,000+. The contractor challenged the CO's action pursuant to the Contract Disputes Act. The board granted the government's motion for summary judgement, saying:


The Government correctly points out in the memorandum in support of its motion to dismiss, and appellant admits, that this appeal is similar to that in BUI Construction Co. & Building Supply, supra, wherein we held that Davis-Bacon Act wage rate determinations applied to a Government contract even though neither the solicitation nor the contract contained the labor standards provision or the wage rate determinations required by statute to be included in the contract, upon the following rationale:

The Labor Standards Provisions and the Department of Labor Wage determinations are statutory requirements for all construction, repair and rehabilitation contracts for federal public buildings in amounts over $2000. (40 U.S.C. 276(a)). It is well settled that if a statute requires inclusion of a contract provision, such provision will be read into the contract by operation of law, and is binding on the parties even if omitted from the contract terms. G.L. Christian and Associates v. United States [9 CCF par. 71,964], 312 F.2d 418 (Ct. Cl. 1963) on rehearing, 320 F.2d 345, cert. denied, 375 U.S. 954 (1963). Obligatory congressional enactments cannot be abrogated by failure of Government officials to include necessary provisions in the contract. G.L. Christian, on rehearing, supra. The courts have also held that a contractor is charged with the knowledge of such mandatory requirements. De Matteo Construction Co. v. United States, [26 CCF 83,207], 600 F.2d 1384, 1391 (Ct. Cl. 1979). Lack of actual knowledge does not extinguish a contractor's obligation to comply with the law.

Accordingly, we conclude that the wage determination schedule and the Labor Standards Provisions were binding on appellant from the contract's inception, and their omission from the solicitation did not constitute a contract change, entitling appellant to an equitable adjustment in contract price.

Applying the same reasoning to the present appeal, we conclude that the DOL wage rate determinations under the Service Contract Act were binding on appellant whether it had actual notification thereof or not.

See also Kleenco, Inc., ASBCA 44348, 93-2 BCA P 25619 and TWigg Corp. v. GSA, GSBCA 14639, 99-1 BCA P 30217. In each case the board applied the Christian doctrine to read an omitted SCA wage determination into a contract.

The Government Contractor summarized the Miller decision as follows:

The SCA and the DOL wage determinations are statutory requirements for this type of contract. It is well established that, if a statute requires that a contract include a particular provision, that provision will be read into the contract by operation of law (and be binding on the parties thereto) even if it was omitted from the contract terms. G.L. Christian & Assocs. v. U.S., 312 F.2d 418 (Ct. Cl.), 5 GC ¶ 57, 320 F.2d 345 (Ct. Cl.), 5 GC ¶ 325, cert. denied, 375 U.S. 954 (1963), 5 GC ¶ 572.

Consequently, the DOL wage rate determination was binding on contractor, even if contractor was not actually notified of it. See BUI Const. Co. & Bldg. Supply, ASBCA 28707, 84-1 BCA ¶ 17183, 26 GC ¶ 184. DOL wage determinations were statutory requirements for the type of contract involved, and, therefore, would be read into the contract by operation of law.

Some legal commentators (Feldman, Sullivan and Gill) have questioned the soundness of those decisions, saying that the Christian doctrine should not apply. However, as of today the case law is still good.

BTW, it's FAR 52.222-41, not 52.222-43, that should be the basis for incorporating a revised wage determination. I never said it was to be done under FAR 52.222-43.

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Thanks. There is no library where I live that has the BCAs, but there are libraries in cities nearby. The next time I am in one of them, I will have to make a special effort to check out these decisions.

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Retreadfed, I used to find a lot of information in the law library at the local Federal Courthouse. I haven't been to a local county courthouse but they may have a law library with Federal board and court decisions....

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