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  • Question

    Based on this information, would the Contractor be entitled to a Contract Price Adjustment due to the conformance of the Labor Classification and hourly Wage Rates? Thank you.


    Answer

    The following response was developed after obtaining additional information from the submitter:

    There is always a concern that an offeror may initially propose Service Contract Labor Standards (formerly SCA)-exempt labor categories in order to reduce its overall proposed contract cost. It can then hope to "profit" (after winning the award with artificially low proposed labor costs) once a conformed, higher rate is approved by DOL for more expensive labor and the contract price is subsequently modified upward. In addition, an existing contractor could use incumbent workers for a follow-on task order and essentially cut their pay while waiting on a Government adjustment. Information obtained from the Dept. of Labor indicates that because the company proposed a job category as exempt from the SCLS does not require the Government to make wage adjustments throughout the life of the task order.

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