The Service Contract Act (SCA) is a federal law that applies to federal contracts that require the provision of services. The SCA provides minimum wage and benefit protections to workers who perform services on federal contracts. Under the SCA, contractors are required to pay their workers prevailing wages, as determined by the Department of Labor.
When a federal contract ends, the contracting agency may choose to award the contract to a different contractor. When this happens, the new contractor is known as the “successor contractor.” The successor contractor is responsible for complying with the SCA, just like the previous contractor.
Compliance with the SCA is important for both contractors and workers. For contractors, compliance with the SCA ensures that they are in good standing with the federal government and that they are not at risk of losing their contract. For workers, compliance with the SCA ensures that they receive the wages and benefits that they are entitled to under the law.
When a contractor becomes a successor contractor, there are several steps they must take to ensure compliance with the SCA. First, they must review the SCA wage determinations for the contract they are taking over. This will help them determine the appropriate wage rates for their workers.
Next, the successor contractor must notify the employees of the previous contractor of their rights under the SCA. This notification should include information about the SCA wage determinations and the new contractor’s obligations under the law.
The successor contractor must also ensure that they are complying with all other aspects of the SCA, including the provision of fringe benefits and payment of overtime wages.
Finally, the successor contractor must maintain accurate records of the wages and benefits they provide to their workers. This is important for ensuring compliance with the SCA and for defending against any potential claims or audits.
In summary, compliance with the Service Contract Act is essential for both contractors and workers on federal contracts. When a contractor becomes a successor contractor, they must take steps to ensure compliance with the SCA, including reviewing wage determinations, notifying workers of their rights, providing fringe benefits, and maintaining accurate records. By following these steps, contractors can ensure that they are in good standing with the federal government and that their workers receive the wages and benefits they deserve.