Office of Acquisition and Logistics (OAL)
Part M822 - Application of Labor Laws to Government Acquisitions
|« VAAM Part M818||VAAM Table of Contents||VAAM Part 823 »|
|M822.302||Liquidated damages and overtime pay.|
|M822.302-70||Contract work hours and safety standards violations and liquidated damages.|
|M822.804||Affirmative action programs.|
- Appendix M822-A, Applicability of Construction Wage Rate Requirements Statute (Davis-Bacon Act) in Construction Contracts with Options
- Appendix M822-B, Investigations – Procedures, Guidance and Information
“Labor advisor,” as used in this part, means the VA Labor Advisor appointed by the Office of Acquisition and Logistics (OAL). A list of agency labor advisors is posted on Department of Labor internet site https://www.wdol.gov/ala.aspx.
(e) Any action containing the FAR clause 52.222-1, Notice to the Government of Labor Disputes, requires contractors to report actual or potential labor disputes to the contracting officer.
Contracting officers shall notify the VA Labor Advisor, of any potential or actual labor disputes that may interfere with performing any contracts or orders under its cognizance in accordance with head of the contracting activity (HCA) procedures.
(a) When a contractor is unable to deliver urgent and critical items because of a work stoppage at its facility, the contracting officer shall, before initiating any action and before removing any items from the facility—
(1) Contact the Labor Advisor to obtain the opinion of the national office of the Federal Mediation and Conciliation Service or other mediation agency regarding the effect movement of the items would have on labor negotiations.
(4) If agreement for removal of the needed items cannot be reached following any of the procedures in paragraphs (a)(1) through (a)(3) of this subsection, refer the matter to the Labor Advisor. If the Labor Advisor is unsuccessful in obtaining concurrence of the parties for the movement of the material and further action to obtain the material is deemed necessary, refer the matter to the HCA. Upon review and verification that the items are urgently or critically needed and cannot be moved with the consent of the parties, the HCA, on a non-delegable basis, may order removal of the items from the facility.
(a) If the dispute involves a project (including construction), service or product required to meet schedules for urgently needed VA programs or requirements, the applicable HCA shall consider the degree of impact of the labor dispute, and shall obtain and develop data reflecting the impact of the labor dispute. Upon determining the impact, the HCA shall submit a report of findings and recommendations to the VA Labor Advisor. See https://www.wdol.gov/ala.aspx.
(d) The VA Labor Advisor shall recommend a course of action to the CAO and require the HCA to expand the impact report submitted under paragraph (c) of this subsection by addressing the following, as appropriate—
(i) For programs, include requirements for each VA requiring official. Where applicable, state in detail program schedule, inventory objectives, assets against these objectives, and critical shortages.
(i) Capabilities, if any, to substitute items or to use alternate sources and indicate the number of other facilities available and the relative capabilities of such facilities in meeting total requirements;
(ii) Project the degree of criticality of a program, project, or service resulting from a work stoppage on a calendar basis, indicating the increased impact, if any, as the stoppage lengthens. Criticality is measured by the number of days required for the work stoppage to have an effect on operational capability. This time shall be stated in terms of calendar days.
(a) Contracting officers shall direct all inquiries from contractors or contractor employees regarding the applicability or interpretation of Occupational Safety and Health Act (OSHA) regulations to the DOL.
(b) Contracting officers shall not initiate any application for the suspension or relaxation of labor requirements without prior coordination with the Labor Advisor. OSHA must approve requests for any variance or alternate means of compliance with OSHA requirements.
The HCA is the designated approving official. The HCA may delegate overtime approval authority to a level no lower than the contracting officer.
(c) If the HCA finds that the administratively determined liquidated damages due under paragraph (a) of FAR 22.302 are incorrect, or that the contractor or subcontractor inadvertently violated the Contract Work Hours and Safety Standards Act despite the exercise of due care, the HCA may—
(3) For liquidated damages above $500, prepare and submit a request to the Labor Advisor to endorse and forward to the SPE/DSPE a recommendation that the Secretary of Labor reduce or waive liquidated damages over $500.
(3) Advise the contractor in writing of any decision to withhold funds, including the reasons for the withholding, and the amount held to satisfy the contractor’s liability for unpaid wages and liquidated damages.
(b) If the contractor protests either that the sum determined is incorrect or that the violations were inadvertent, notwithstanding the exercise of due care, the contracting officer shall advise the contractor of its right to appeal this action to the Secretary of Veterans Affairs under the provision of section 104(c) of the Contract Work Hours and Safety Standards Act. The contracting officer shall also advise the contractor that the appeal shall be taken under section 104(c) and not under the Disputes clause of the contract. If the protest is made orally to the contracting officer, the contracting officer shall advise the contractor to submit its appeal, in writing, within 60 days after receipt of the contracting officer’s decision. Should the protest be in writing, however, the contracting officer shall treat the letter of protest as an appeal. In each instance, the contracting officer shall forward the written protest or appeal through the HCA to the VA Labor Advisor. Coordinate all written communications with the contractor, including the notification of dispute resolution procedures under the DOL’s regulations at 29 CFR Parts 4 through 8, with the support of legal counsel.
(3) The Secretary of Labor takes final action on the Secretary of Veterans Affairs’ recommendation to waive or adjust liquidated damages in excess of $500. Also see M822.406-9, Withholding from or suspension of contract payments.
(d) Upon final administrative determination of the contractor’s liability for liquidated damages, the contracting officer shall transmit withheld or collected funds determined to be owed to the Government as liquidated damages to the servicing finance officer for crediting to the appropriate Government Treasury account. The contracting officer shall return any excess withheld funds to the contractor (see 29 CFR 5.8).
(a) See Department of Labor User’s Guide, https://www.wdol.gov/usrguide/index.aspx, to obtain appropriate Service Contract Labor Standards (historical title: Service Contract Act) and/or the Construction Wage Requirements statute (historical title: Davis-Bacon Act (DBA)) wage determinations for each official solicitation, re-solicitation, option, extension or any other contract action requiring the most recent and applicable wage determination. Apply both the Service Contract Labor Standards and the Construction Wage Requirements statute (DBA) to VA support contracts if—
(b) Service Contract Labor Standards coverage under the contract. VA hospital, facility and, medical center support requirements, such as facility operations and installation services (i.e., custodial, snow removal, grounds maintenance etc.) are subject to the Service Contract Labor Standards. Apply Service Contract Labor Standards clauses and minimum wage and fringe benefit requirements to all contract service calls or orders for such maintenance and support work.
(c) Construction Wage Rate statute (DBA) coverage under the contract. Contracts for construction, alteration, renovation, painting, and repair requirements (e.g., roof shingling, building structural repair, paving repairs, etc.) are subject to the Construction Wage Rate statute requirements (DBA). Apply the applicable clauses and minimum wage requirements to all contract service calls or orders for construction, alteration, renovation, painting, or repairs to buildings or other works.
(d) Repairs versus maintenance. Some contract work may be characterized as either Construction Wage Rate statute applicable (DBA painting/repairs) or Service Contract Labor Standards maintenance. For example, replacing broken windows, spot painting, or minor patching of a wall could be covered by either the DBA or the Service Contract Labor Standards. In those instances where a contract service call or order requires construction trade skills (e.g., carpenter, plumber, painter, etc.), but it is unclear whether the work required is Service Contract Labor Standards maintenance or DBA painting/repairs, apply the following rules:
(e) The determination of labor standards application shall be made at the time the solicitation is prepared in those cases where requirements can be identified. Otherwise, the determination shall be made at the time the service call or order is placed against the contract. The service call or order shall identify the labor standards law and contract wage determination which will apply to the work required.
Direct all questions regarding Department of Labor (DOL) regulations to the VA Labor Advisor.
(a) In accordance with FAR 22.403-1, the Construction Wage Rate Requirements statute (Davis-Bacon Act (DBA)) applies to contracts in excess of $2,000 to which the United States or the District of Columbia (D.C.) is a party for construction, alteration, and/or repair, including painting and decorating, of public building or public works of the United States or the District of Columbia. The Construction Wage Rate Requirements statute requires that all laborers and mechanics employed on the site of the project be paid not less than the wages and fringe benefits determined by the DOL to be prevailing in the area.
(1) Public building or public work. Public buildings include the building structure and all utility systems and other improvements to the structure. This includes plumbing, electrical, and lighting systems, fire alarm and suppression systems, heating, ventilation and air conditioning systems, elevators, material handling systems, built-in cranes, hoists, attached antennas, etc. Public works are structures and improvements other than buildings, such as roads, runways, bike-paths, storage tanks, wells, exterior portions of utility systems, exterior pools, playgrounds, playing courts, antennas not attached to a building, etc., “Public” does not require access by the general public.
(2) Party to contract. The courts have ruled that the Construction Wage Rate Requirements (DBA) also applies to many “lease construction” contracts under which construction is funded by third parties such as banks. See DOL memorandum number 176 dated 22 Jun 94. The government merely contracts to lease the completed facilities at a specified rate for a specified number of years. The statute would also apply to so-called “no cost” improvements to public buildings performed by utility companies (such as installation of energy-efficient lighting-the cost of which is deducted from future savings).
(3) United States or D.C. The Construction Wage Rate Requirements statute (DBA) applies only within the 50 states and D.C. It does not apply to Federal construction contracts in Guam, Puerto Rico, Virgin Islands or other territories, although other laws may invoke DBA on certain civilian projects there.
(4) Construction, Alteration, or Repair and Painting and Decorating. Construction, alteration, repair, painting, or decorating does not include regularly-recurring, routine maintenance of public buildings and works. Alteration involves making a relatively permanent improvement to a building or work. Repair goes beyond maintenance, and is usually performed to return something to operational use rather than to keep it operating.
Example: overhaul of an elevator is much more extensive than simple maintenance, and shall be considered repair. Renovation also goes beyond maintenance. Example: replacing several cracked windowpanes is a maintenance task but replacing all windowpanes in a building or part of a building shall be considered renovation subject to the statute.
(c) All painting other than minor touch-up following routine maintenance is subject to the Construction Wage Rate Requirements statute (DBA). The statute also covers decorating, which may involve wallpapering, paneling/wainscoting, installation of decorative ironwork, wood trim, etc.
The Office of Construction and Facilities Management provides information on the Construction Wage Rate Requirements statute (historical title: Davis Bacon Act or DBA) Wage Rate Determination at the following link: https://www.cfm.va.gov/contract/WageRate.asp. This website contains information and guidance pertaining to contract work to be performed that is not covered under any classification listed in the wage determination.
For guidance pertaining to the applicability of DBA for construction contracts with options see Appendix A.
(a) Not later than April 1 of each year each HCA shall submit, through the VA Labor Advisor, a consolidated list of approved construction projects (to include construction maintenance and repair projects) subject to the Construction Wage Rate Requirements statute (DBA) for which contracts are proposed to be awarded by subordinate contracting offices in the ensuing fiscal year to: U.S. Department of Labor, Employment Standards Administration, Wage and Hour Division, Branch of Construction Wage Determinations, Washington, DC 20210. The DOL uses this information to determine where general wage determination surveys will be conducted.
(b) During the fiscal year, the HCA shall notify the VA Labor Advisor of any significant changes in their proposed construction programs as reported to DOL. The report format is contained in DOL All Agency Memo 144, December 27, 1985, (see 29 CFR 1.4).
(a) General. The contracting officer shall inform the prime contractor of the necessity to include labor standard clauses in all subcontracts with a preconstruction letter or at the preconstruction conference (see 29 CFR 5.5(a)(6)). The contracting officer shall document the discussion of the requirement to include labor standard clauses in all subcontracts at a preconstruction conference. Contracting officers shall file the documentation of the discussion in the respective Electronic Contract Management System (eCMS) contract file briefcase.
(1) Promptly after award of the contract, the contracting officer shall hold a preconstruction conference with the prime contractor or provide a letter to the prime contractor that accomplishes the following, as appropriate:
(A) Davis–Bacon Act. (Now known as the Construction Wage Rate Requirements statute.)
(B) Contract Work Hours and Safety Standards statute. (Historical title: Contract Work Hours and Safety Standards Act.)
(C) Copeland (Anti-Kickback) Act. (Now referred to simply by the title “Kickbacks.”)
(E) Executive Order 11246 (Equal Employment Opportunity).
(G) The applicable provisions of FAR 22.403; and
(iii) It is necessary to determine whether the contractor and its subcontractors intend to pay any required fringe benefits in the manner specified in the wage determination or to elect a different method of payment.
(3) The Payroll Form WH-347, and, Instruction for Completing Payroll Form WH-347https://www.dol.gov/whd/forms/wh347instr.htm, developed by the Department of Labor, may be used as the basis of the discussion.
(1) The contracting officer or the authorized Contracting Officer’s Representative (COR) shall make the examination required by FAR 22.406-6(c) as appropriate. The contracting officer shall assure each pay period is accounted for and that each weekly payroll contains the information required. The COR shall, with each payroll submission, certify the rates of pay comply with the contract wage determination and the labor standards provisions. In the event payrolls are not received within the time specified by the COR, the COR shall inform the contracting officer. The contracting officer shall take immediate action to secure the payroll submission. The contracting officer shall include the COR requirement to perform the examination required by FAR 22.406-6(c) in the COR appointment letter.
(d) Preservation. The contracting officer shall file and maintain completed and signed copies of payrolls and statements of compliance (Form WH 347) submitted pursuant to FAR 22.406-6 in the respective eCMS briefcase, (see 29 CFR 5.6(a)(3)).
(b) Before beginning an investigation, the investigator shall inform the contractor that a labor standards investigation is being performed, and that the investigation will include examining pertinent records and interviewing employees. In conducting the investigation, follow the procedures at Appendix B.
(c) Contractor notification. Notify the contractor by certified mail of any finding that it is liable for liquidated damages under the Contract Work Hours and Safety Standards (CWHSS) statute. The notification shall inform the contractor that—
(2) The appeal shall demonstrate either that the alleged violations did not occur, but occurred inadvertently notwithstanding the exercise of due care, or that the assessment was computed improperly; and
(d) Contracting officer’s report. Forward a detailed enforcement report or summary report to the Labor Advisor in accordance with HCA procedures. Include in the report, as a minimum, the information specified at Appendix B paragraph (8). Use Standard Forms (SF) 1445 Labor Standards Interview, and SF 1446, Labor Standards Investigation Summary Sheet, to document regular investigations and employee interviews to assure contractors’ compliance with labor standards in construction contracts.
(a) Withholding from contract payments. The contracting officer shall contact the Labor Advisor for assistance when payments due to a contractor are not available to satisfy that contractor’s liability for Wage Rate Requirements (IAW 48 CFR 222.406-9) statute wage underpayments or liquidated damages.
(3) Limitation on forwarding or returning funds. When disposition of withheld funds remains the final action necessary to close out a contract, the Department of Labor has given blanket approval to forward withheld funds to the Comptroller General pending completion of an investigation or other administrative proceedings.
(4) Liquidated damages. See M822.302-70.
(d) The contracting officer shall provide any findings along with the contractor’s statement to the Labor Advisor for submission to the Administrator, Wage and Hour Division in accordance with HCA procedures.
Prior to terminating any contract or subcontract for violation of the labor standards clauses, the contracting officer shall, in consultation with the Labor Advisor, prepare a detailed report that documents the facts and circumstances surrounding the violation. The contracting officer shall obtain a legal review of the proposed termination from the supporting Office of General Counsel (OGC). The report and results of the legal review will be forwarded to the SPE/DSPE for further review. If the contract is to be terminated, the SPE/DSPE shall submit the report as required by FAR 22.406-11 to DOL’s Administrator, Wage and Hour Division, and the Comptroller General.
(a) The HCA shall forward semiannual reports to the VA Labor Advisor within 15 days following the end of the reporting period. These reports shall not include information from investigations conducted by the DOL. The Labor Advisor will consolidate these reports into an agency report, which will be submitted to the DOL not later than April 30 and October 31 of each year. A negative report is required. These reports shall contain the following information, as applicable, for construction work subject to the DBA and the CWHSS statute:
(a) Reports of violations–regular investigations. Each non willful violation involving the Contract Work Hours and Safety Standards Act, which has been corrected, but which requires the assessment of liquidated damages, will be reported to the SPE. Based on the facts of the case, the contracting officer shall submit a recommendation with the report as to whether the contractor should be relieved of this liability.
(1) Reports of investigations conducted by the DOL are submitted by their Washington office to the SPE. After review by the SPE (and except as provided in paragraph (c)(2) of this section), the report will be furnished to the contracting officer concerned for necessary action together with such advice and guidance as may be indicated.
(2) If the investigation report indicates possible violations of a criminal nature, the SPE will forward the report to the VA Inspector General for investigation and referral to the Department of Justice. In the event the case is submitted to the Department of Justice, the contracting officer and the Department of Labor will be so advised by the SPE. No collection, recovery or other settlement action will be initiated while the matter is in the hands of the Department of Justice without first obtaining the concurrence of the U.S. attorney concerned, through the Inspector General.
(3) The contracting officer shall review the report of investigation and complete the actions indicated therein. The contracting officer will submit a report of the actions taken to SPE, with recommendations regarding the assessment of liquidated damages and the imposition of sanctions. The SPE will, after reviewing this report, submit a report to the DOL of the actions taken, together with recommendations for any suggested actions to be taken by that agency.
(a) VA planners shall consider whether a Project Labor Agreements (PLA) requirement shall be included for construction contract actions associated with large-scale projects and document the results based on an objective analysis. VA’s contracting officers shall refer to and follow FAR Subpart 22.5, Use of Project Labor Agreements when necessary. If a PLA requirement is included in the solicitation, the contracting officer shall ensure any additional requirements under FAR 22.504(b)(6) or any prescribed terms and conditions under FAR 22.504(c) were coordinated with supporting OGC and are explained in the file memorandum.
(b) In cooperation with the program office or project manager, the contracting officer shall ensure that the acquisition plan properly identifies each construction contract action associated with a large-scale project if the estimated value is $25 million or greater. The contracting officer will prepare a file memorandum reflecting rationale for the PLA decision (either for or against) and have it approved by the HCA or the HCA’s designee. The appropriate PLA provision and clause shall be included in the solicitation/contract when a PLA will be required.
(c) Factors to Consider and Documentation. In addition to the factors at FAR 22.503, the following may be used to assist VA planners in determining whether requiring a PLA is in the best interest of the government and the specific terms and conditions the offeror/contractor shall include in the PLA itself:
(2) Request the Architect/Engineer provide information to the project manager, during each design phase, regarding current local market/economic conditions and labor shortages, as well as information on whether PLAs were used successfully in the project area.
(c) The VA Labor Advisor is responsible for ensuring that the requirements of FAR 22.8 are carried out within the agency, and for cooperating with and assisting the Office of Federal Contractor Compliance Programs (OFCCP) in fulfilling its responsibilities.
(d) In the event the applicability of Executive Order 11246 and implementing regulations are questioned, the contracting officer through the HCA shall forward the matter through the VA Labor Advisor to the Deputy Assistant Secretary for resolution.
(b) The list of geographical areas subject to affirmative action requirements can be obtained from the OFCCP, U.S. Department of Labor. Contracting officers contemplating a construction project in excess of $10,000 within a geographic area not known to be covered by specific affirmative action goals shall request instructions on the most current information from the OFCCP regional office.
(c) Contracting officers shall give written notice to the OFCCP regional office within 10 working days of award of a construction contract subject to affirmative action requirements in accordance with HCA procedures. A list of OFCCP regional office is provided at https://www.dol.gov/ofccp/contacts/regkeyp.htm.
(a) The contracting officer shall include the value of the basic contract plus priced options to determine whether the contract meets the threshold in FAR 22.805(a). A contract modification exercising a priced option is not a contract award under FAR 22.805(a)(1)(ii) and does not require a preaward clearance. Contracting officers shall submit preaward clearance requests directly to the appropriate OFCCP regional office. The content of preaward clearance request is prescribed by FAR 22.805(a)(5). See FAR 22.805(a)(6) and (7) for timelines delineated for the submission of requests for preaward clearance to OFCCP and receipt of OFCCP’s response.
(b) The EEO poster required by FAR 22.805(b) can be found at: https://www.dol.gov/ofccp/regs/compliance/posters/ofccpost.htm.
(c) When seeking an exemption from the requirements of Executive Order 11246, submit the request with a justification through the HCA to the VA Labor Advisor, who will forward the request to the SPE. If the request is submitted under FAR 22.807(a)(1), the SPE shall act on the request. If the exemption is granted, the SPE shall notify the Director, OFCCP, of such action within 30 days. If the request is submitted under FAR 22.807(a)(2) or (b)(5), the SPE will forward it to the Director, OFCCP, for action.
(c) The contracting officer shall submit a request to the Labor Advisor, in accordance with HCA procedures, when seeking a waiver against the terms at FAR clause 52.222-35, Equal Opportunity for Veterans. If the request is justified; the Labor Advisor will endorse and forward the request, through the DSPE, for action by the Secretary of Veterans Affairs. The DSPE shall notify the Deputy Assistant Secretary of Labor of the waiver in writing within 30 days.
(1) Forward any complaints received about the administration of the Vietnam Era Veterans’ Readjustment Assistance Act of 1972 (38 U.S.C. 4211 and 4212) (the Act) to the Veterans’ Employment and Training Service of the Department of Labor and OFCCP regional office in accordance with HCA procedures; and
(2) Notify the complainant of the referral. The contractor in question shall not be advised in any manner or for any reason of the complainant’s name, the nature of the complaint, or that the complaint was received.
(c) The contracting officer shall submit a request for waivers under FAR 22.1403(a) and FAR 22.1403(b), to the Labor Advisor. If the request is justified, the Labor Advisor will endorse and forward the request, through the DSPE, for action by the Secretary of Veterans Affairs, and for submission for DOL concurrence.
Following agency procedures, the contracting office shall forward any complaints received about the administration of the Rehabilitation Act of 1973 (the Act) to the—
Deputy Assistant Secretary for Federal Contract Compliance
200 Constitution Avenue, NW
Washington, DC 20210
or to any OFCCP regional or area office. The OFCCP shall institute investigation of each complaint and shall be responsible for developing a complete case record. The contracting officer shall notify the complainant of such referral. The contractor in question shall not be advised in any manner or for any reason of the complainant's name, the nature of the complaint, or that the complaint was received.
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