[Code of Federal Regulations]
[Title 29, Volume 1]
[Revised as of July 1, 2001]
From the U.S. Government Printing Office via GPO Access
[CITE: 29CFR4.104]

[Page 52-53]
 
                             TITLE 29--LABOR
 
PART 4--LABOR STANDARDS FOR FEDERAL SERVICE CONTRACTS--Table of Contents
 
   Subpart C--Application of the McNamara-O'Hara Service Contract Act
 
Sec. 4.104  What the Act provides, generally.

    The provisions of the Act apply to contracts, whether negotiated or 
advertised, the principal purpose of which is to furnish services in the 
United States through the use of service employees. Under its 
provisions, every contract subject to the Act (and any bid specification 
therefor) entered into by the United States or the District of Columbia 
in excess of $2,500 must contain stipulations as set forth in Sec. 4.6 
of this part requiring: (a) That specified minimum monetary wages and 
fringe benefits determined by the Secretary

[[Page 53]]

of Labor (based on wage rates and fringe benefits prevailing in the 
locality or, in specified circumstances, the wage rates and fringe 
benefits contained in a collective bargaining agreement applicable to 
employees who performed on a predecessor contract) be paid to service 
employees employed by the contractor or any subcontractor in performing 
the services contracted for; (b) that working conditions of such 
employees which are under the control of the contractor or subcontractor 
meet safety and health standards; and (c) that notice be given to such 
employees of the compensation due them under the minimum wage and fringe 
benefits provisions of the contract. Contractors performing work subject 
to the Act thus enter into competition to obtain Government business on 
terms of which they are fairly forewarned by inclusion in the contract. 
(Endicott Johnson Corp. v. Perkins, 317 U.S. 501, 507 (1943).) The Act's 
purpose is to impose obligations upon those favored with Government 
business by precluding the use of the purchasing power of the Federal 
Government in the unfair depression of wages and standards of 
employment. (See H.R. Rep. No. 948, 89th Cong., 1st Sess. 2-3 (1965); S. 
Rep. No. 798, 89th Cong., 1st Sess. 3-4 (1965).) The Act does not permit 
the monetary wage rates specified in such a contract to be less than the 
minimum wage specified under section 6(a)(1) of the Fair Labor Standards 
Act, as amended (29 U.S.C. 206(a)(1)). In addition, it is a violation of 
the Act for any contractor or subcontractor under a Federal contract 
subject to the Act, regardless of the amount of the contract, to pay any 
of his employees engaged in performing work on the contract less than 
such Fair Labor Standards Act minimum wage. Contracts of $2,500 or less 
are not, however, required to contain the stipulations described above. 
These provisions of the Service Contract Act are implemented by the 
regulations contained in this part 4 and are discussed in more detail in 
subsequent sections of subparts C, D, and E.