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Orlando contractor to pay $575,000 after DOL investigation uncovers improper pay deductions

September 12, 2018 By Andrew Smith

Loyal Source Government Services LLC – a medical and support staff contactor based in Orlando, Florida – will pay $574,989 to 4,047 employees after a U.S. Department of Labor Wage and Hour Division (WHD) investigation determined the company violated the McNamara-O’Hara Service Contract Act (SCA).

WHD investigators found Loyal Source Government Services LLC unlawfully deducted $10 per paycheck from each employee for the administration of employee health and welfare benefits.

“This investigation demonstrates the Department of Labor will enforce all applicable laws to ensure that employees receive legally required pay and benefits,” said Wage and Hour Division District Director Daniel White, in Jacksonville. “The Department’s Wage and Hour Division encourages all employers to make use of the many tools we provide to help them understand and comply with the law, and to call us for assistance.”

For more information about the SCA and other laws enforced by the Division, contact its toll-free helpline at 866-4US-WAGE (487-9243). Information is also available at http://www.dol.gov/whd/ including a search tool to use in the event a worker suspects he/she may be owed back wages.

Source: https://www.dol.gov/newsroom/releases/whd/whd20180907

Filed Under: Contracting News Tagged With: compliance, DOL, enforcement, Labor Dept., labor laws, labor rates, SCA, Service Contract Act, WHD

Federal contractor paid sick leave regulations finalized

October 11, 2016 By Andrew Smith

paid-sick-leave-regulations-oct-2016The Labor Department’s Wage & Hour Division (WHD) has released final regulations implementing mandatory paid sick leave for employees working on federal service, construction, and concessions contracts.

The costs are likely to come both from the paid sick leave itself (a maximum of seven days per year) and from the layers of complexity on top of contractors’ existing compliance obligations with respect to these types of contracts.

The regulations overlap with WHD’s responsibility for oversight of the Service Contract Labor Standards (commonly known as the Service Contract Act, or SCA), which is already a complicated compliance undertaking for employers.

Keep reading this article to see a summary of the highlights of the final regulations and flag issues for contractors to consider before the regulations take effect in January 2017: https://www.insidegovernmentcontracts.com/2016/10/paid-sick-leave-final-regulations-released/

Filed Under: Contracting News Tagged With: DOL, federal contracting, federal contractors, federal contracts, Labor Dept., SCA, Service Contract Act, Service Contract Labor Standards, sick leave, subcontracting, Wage & Hour Division, wage rates, WHD

Requirement for paid sick leave could penalize contractors who already offer that benefit

March 31, 2016 By Andrew Smith

DOLFollowing up on President Obama’s Labor Day release of an executive order requiring government contractors to offer paid sick leave to employees, the Labor Department issued proposed implementing regulations and invited comments by April 12.  Contractors with service contracts should consider submitting comments, especially if they already offer paid sick leave and rely on that leave to meet their fringe benefit obligations under the Service Contract Act (SCA).

Under the SCA, contractors cannot take credit for offering benefits that they are legally required to provide.  By setting a minimum required level of paid sick leave, the proposed regulations convert seven days of those benefits into legal requirements, rendering them ineligible for bona fide fringe benefit status under the SCA.  Contractors would remain free to continue to account for the value of excess paid sick leave in discharging their SCA obligations, but not the base requirements.  As a result, contractors may have to recalculate their fringe benefit packages by extracting the value of current paid sick leave benefits, and then offer some other offsetting bona fide fringe benefit or an equivalent cash payment.  In sum, the paid sick leave executive order could have the effect of penalizing contractors who were already offering the very same benefit that the government now requires.

Keep reading this article at: https://www.insidegovernmentcontracts.com/2016/03/labor-department-invites-comments-on-regulations-governing-paid-sick-leave/

Filed Under: Contracting News Tagged With: DOL, Executive Order, fringe benefit, Labor Dept., public comment, SCA, Service Contract Act, sick leave

Contractors affected by recent hikes in Service Contract Act’s health & welfare rates must file timely claims

August 5, 2014 By ei2admin

On federal contracts subject to the Service Contract Act, the prevailing health and welfare (H&W) fringe benefit rate was increased, effective July 22, 2014, to $4.02 per hour.  (One exception: The new benefit rate in Hawaii is $1.66.)

The new H&W rate applies to all invitation for bids opened, or other service contracts awarded on or after July 22, 2014.

Contracting offices are to include a new wage determination reflecting the new H&W rate to trigger the contractor’s obligation to pay the higher H&W rate. Contracting offices may make “pen and ink” changes to the current wage determinations received for contracts beginning on or after July 22, 2014 and for which the updated rates were not included.

Once the contracting authority provides a new wage determination, contractors must submit — within 30 days of the change — any claim for an equitable adjustment as a result of increased costs attributable to wage determination rate changes.

Filed Under: Contracting News Tagged With: claim, DOL, EPA, equitable adjustment, health & welfare, SCA, Service Contract Act, wage determinations

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