This series of FAR summaries is meant to take a meaningful portion of the Federal Acquisition Regulations to ensure an easy-to-understand approach to maintain that readers comprehend the process of doing business with the government and that the government exercises a fair and reasonable approach to doing business with the general public.
FAR 37.107 Service Contract Labor Standards
I contracted services for about 8 years for the VA’s FSS program in Hines, IL. Those are base contracts for non-personnel medical services for the federal government’s health system.
There’s a reason I’ve selected this portion to summarize. I bet you can guess even though it’s only a stone’s throw more than eight lines long.
Read 41 U.S.C. chapter 67 for more details.
Minimum Wage
This corresponds to the hourly rate to the service provider not the fully-loaded rate. If you are working on medical schedules then the hourly rate is near the top of 03-1d while the fully-loaded rate is at the bottom. It shows how the hourly rate builds to the proposed price. Each line-item has an hourly rate and a fully-loaded rate or proposed price. Remember, you’re focusing on the hourly rate for compliance of this portion.
Each contract is performed in a location or series of locations. If multiple, focus on the one with the highest cost of living.
You then select “Wage Determinations” from SAM.gov and input the county and state of the highest priced city of performance.
Find the most recent set of determinations released by DOL. You will find a PDF with a multi-figure number, a job title and a price point in each row.
The first number is the occupation series (Hint: many in the FSS are in the 11 series!). The second item is the job title to the corresponding occupational code within its occupational series. The price point is the minimum hourly rate that that particular service provider must be paid in that specific location or the specified umbrella of geographic coverage concerning the solicitation and contract.
Minimum wage must be adhered to. You can pay your people more per hour but you can never pay less. Check this before submitting your proposal, putting together modifications, placing extensions and at the beginning and end of each federal fiscal year.
Fringe Benefits
These are state and federal taxes insurance and vacation/leave. Think things like FUTA, SUTA, FICA, health/welfare wage, vacation and sick leave. Notice how taxes are different in every state. Big ups to Glen Sterling in the FSS who has great knowledge of the tax effect on fair and reasonable contract prices.
Contract Employment
The number of employees must be fluid to past contracts. The employer has to give selected employees ten (10) days to decide. They can choose not to work on the contracted federal project. This doesn’t apply to subcontractors, though. Relocation costs are not included. The Contracting Officer must be provided a list of names of those performing on the contract.
The employee must make the underpaid whole. The government can and will litigate its contracts if this practice is regular and it’s not them who will be punished.
Do the right thing and pay your employees fairly. You’re CO will check. You should, too. Especially, if you are a construction company who hires immigrants.
The Secretary of Labor is watching!
Services was my jam in the federal government. I loved reading the proposals (Especially, the technical proposals). I loved market research (Especially, comparing the commercial market). I loved preparing the negotiation points (Especially, for multiple types of nurses). I loved knowing I put medical service workers in place to serve those families who have borne the battle to maintain our freedoms.
If you think I can help you then email nicholas.s.robertson@outlook.com for your introductory message and free consultation.
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