Understanding the McNamara-O'Hara Service Contract Act: Key Insights

Q: How are prevailing wage rates determined?

Prevailing wage rates are determined based on local standards and can be found in wage determinations issued by the Department of Labor.

Q: What happens if a contractor fails to comply with the SCA?

Failure to comply can result in penalties, including the potential loss of contracts and legal action.

Definition & Meaning

The McNamara-O'Hara Service Contract Act (SCA) is a federal law that mandates minimum wage and fringe benefits for service employees working on contracts with the United States government or the District of Columbia. This act is applicable to contracts exceeding $2,500 that primarily involve providing services to the federal government. Contractors and subcontractors must pay their employees at least the prevailing wage rates and provide benefits as determined by local standards or as specified in existing collective bargaining agreements.

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Legal Use & context

The SCA is relevant in federal contracting and labor law. It ensures fair compensation for service employees, which can include janitorial, maintenance, and other service-oriented roles. Legal professionals may encounter the SCA when advising contractors on compliance with wage and benefit requirements. Users can manage related forms and compliance documentation through resources like US Legal Forms.

Key legal elements

Applies to contracts over $2,500 for service provision to the federal government.
Requires payment of prevailing wage rates for various classes of service employees.
Mandates provision of fringe benefits as per local standards or collective bargaining agreements.
Enforcement by the Wage and Hour Division of the U.S. Department of Labor.
Safety and health standards enforced by the Occupational Safety and Health Administration.

Real-world examples

Here are a couple of examples of abatement:

Example 1: A contractor providing cleaning services to a federal building must pay their employees at least the local prevailing wage for janitorial work and offer health benefits as specified by local labor agreements.

Example 2: A company awarded a contract for maintenance services at a government facility must comply with the SCA by ensuring their workers receive the appropriate wages and benefits (hypothetical example).

Relevant laws & statutes

The primary statute governing this area is the McNamara-O'Hara Service Contract Act, enacted in 1965. Additional regulations and guidelines can be found in the Code of Federal Regulations, Title 29, Part 4, which outlines the specific wage determinations and compliance requirements.

Comparison with related terms

Term	Definition	Differences
Fair Labor Standards Act (FLSA)	A federal law that establishes minimum wage, overtime pay, and youth employment standards.	The SCA specifically applies to service contracts, while the FLSA covers a broader range of employment scenarios.
Wage Determination	A document that specifies the minimum wages and benefits for workers on government contracts.	Wage determinations are part of the SCA compliance, but they are not standalone laws.

Common misunderstandings

What to do if this term applies to you

If you are a contractor or subcontractor working on a federal service contract, ensure you are familiar with the SCA requirements. Review wage determinations and ensure compliance with prevailing wage rates and fringe benefits. You may find it helpful to use US Legal Forms' templates for compliance documentation. If your situation is complex, consider seeking advice from a legal professional.

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Quick facts

Minimum Contract Amount: $2,500
Enforcement Agency: U.S. Department of Labor, Wage and Hour Division
Applicable Sectors: Service contracts for federal and District of Columbia projects
Fringe Benefits: Required as per local standards or collective agreements

Key takeaways

Frequently asked questions

What types of contracts are covered by the SCA?

The SCA applies to service contracts with the federal government or the District of Columbia that exceed $2,500.