Government Contracts Government Responsible for Costs to Comply with SCA
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Monday, September 30, 2019

Government Responsible for Costs to Comply with SCA

By Government Contracts Editorial Staff

An appeal seeking reimbursement of wages paid to employees in compliance with the Service Contract Act was granted by the Civilian Board of Contract Appeals because the contract assigned the responsibility for identifying labor categories subject to the SCA to the ordering contracting officer. The appeal involved three task orders issued under a governmentwide indefinite-delivery/indefinite-quantity contract for information technology services. The parties cross moved for summary judgment, seeking a determination of liability for wages paid to contractor employees to comply with the SCA (41 USC 6701, et seq.). Generally, the clauses at FAR 52.222-41 and FAR 52.222-43 provide that the contractor is responsible for identifying labor categories that are covered by the SCA and matching those categories to the applicable wage determination once the government has determined that the SCA applies.

Greater Obligations. However, the contract here imposed greater obligations on the government than required by the SCA Federal Acquisition Regulation clauses. The contract, by its terms, put the responsibility on the CO to identify the labor categories subject to the SCA. On the first task order, the CO issued a modification to incorporate the SCA clauses, but did not provide an equitable adjustment for the costs incurred as a result of the modification. The second and third task orders included the FAR clauses and wage determinations. Pursuant to FAR 52.222-41, the contractor was responsible for determining which of its proposed positions matched the wage determinations attached to the contract. However, the contract assigned responsibility to the CO to identify SCA-covered positions. The CO declined to do so prior to the conclusion of a Department of Labor investigation. Having failed to undertake that effort, the government was liable for the contractor’s costs. (Sotera Defense Systems, Inc. v. Dept. of Agriculture, CBCA, ¶95,855)

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