Service Contract Act

The McNamara-O’Hara Service Contract Act of 1965, as amended, 41 U.S.C. 351, et. seq. (the “SCA”), applies to every contract entered into by the U.S. Government, the principal purpose of which is to furnish services to the Government through the use of service employees. The SCA requires contractors and subcontractors performing services on covered contracts in excess of $2,500 to pay service employees in various classes no less than the monetary wage rates and to furnish fringe benefits found prevailing in the locality. The SCA is incorporated into the Federal Acquisition Regulation at clause 52.222-41.

As provided for in the SCA and its implementing regulations at 29 C.F.R. §4.156, even if the SCA applies to a contract, the requirements are not applicable to persons employed in a bona fide executive, administrative, or professional capacity as those terms are defined in 29 C.F.R. Part 541 (i.e. they qualify as exempt employees). The SCA uses the same evaluation of qualification as an exempt employee as the Fair Labor Standards Act (the “FLSA”).

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