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bob7947

DOL SCA Health and Welfare Benefits

8 posts in this topic

I'm posting this question for SKoslow:

It was posted as a blog.

Quote

Reviewing an offeror's cost proposal where there is a wage order using SCA labor categories. Can the offeror opt not to pay the employees health and welfare and propose that the employee will be offered company benefits in lieu of the health and welfare payment. The narrative in the cost proposal says that the company benefits available to the SCA WD employee exceed the value of the health and welfare benefit of the WD SCA rate.

I looked in the DOL website and cannot find. looking for a little help.

 

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Try 29 CFR 4.170 and 4.171 for a possible answer to your question.

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If you have a copy of the wage determination, it should also answer the question (in the text after the classification and rates).  Generally, a contractor is not required to pay H&W benefits in cash and may provide benefits of at least an equivalent amount.

If in the solicitation, see 52.222-41, Service Contract Labor Standards, see paragraph (d) and (i).

Also, I'm not familiar with the evaluation criteria in the solicitation regarding price, but a bidder/offeror is not usually required to price a contract to show they are meeting the minimum wage determination amount required (wage and H&W).  They are only required to properly classify employees and pay them according to the wage determination for actual performance under the contract.  As long as they do not take exception to the SCLS requirements in their bid/offer, the lower pricing alone would not necessarily make them ineligible for award.  I haven't looked for other cases, but I believe the first one at the link below supports what I've stated.

http://www.wifcon.com/pd22_1006.htm

 

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Does you agency have an agency labor advisor?

I am puzzled why people don't directly ask their agency labor advisor (if applicable) or DOL's Wage and Hour Division questions concerning proposal compliance with Service Contract Labor Standards requirements. It would appear that a proposed equivalent for the Health and Welfare fringe benefits would need some evaluation per Carl's cited references.

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There is no requirement that a contractor price a proposal using the wages and fringe benefits in a WD.  What is required is that the contractor pay its covered employees the wages and fringe benefits in the WD or provide a bona fide equivalent in fringe benefits.

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Retread,  Thanks for your answer.  I hope the original poster will back away from this rabbit hole.

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Let me clarify my last post.  A contractor cannot off-set required wages with increased fringe benefits.  The contractor must pay not less than the minimum wages specified in the relevant WD.  However, the contractor can substitute one bona fide fringe benefit, such as the employer contribution to a 401K for a fringe benefit specified in the WD.

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23 hours ago, bob7947 said:

Can the offeror opt not to pay the employees health and welfare and propose that the employee will be offered company benefits in lieu of the health and welfare payment.

The question was this

 

12 hours ago, C Culham said:

29 CFR 4.170 and 4.171

The answer is this.

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