Glossary / Regulations, Personnel
Service Contract ActSCA
The Service Contract Act (the McNamara-O'Hara Service Contract Act, now the Service Contract Labor Standards) applies to federal contracts over $2,500 whose principal purpose is services performed by service employees. The contracting officer attaches a Department of Labor wage determination that sets the minimum hourly wage and the health-and-welfare, vacation and holiday benefits for each labor category in the place of performance. Contractors must pay at least those rates, post the determination and keep records; an incumbent's collective bargaining agreement can set the floor for a successor.
Why it matters to your pipeline
SCA wage determinations set the labor floor for every service bid, so pricing below them is both illegal and a losing proposal. They also change with each option period, and a contractor that misses an adjustment eats the difference. For a company new to federal services, the determination is the first document a vCM reads when pricing a bid.
When this term shows up in an opening GovSmith finds for you, your vCM explains what it means for that pursuit and does whatever it calls for. You decide; we do the work.
Example
A janitorial firm pricing a $600K custodial contract reads the attached wage determination: $18.40 an hour for a Janitor plus $5.36 in health-and-welfare benefits. Its labor rate in the proposal starts from those numbers, not from its commercial rates.
Find out what applies to you
Some terms will matter to your business right away and some won’t for years. A vCM can tell you which are which.