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  • Question

    Considering services and construction will personnel cost strictly apply to workers covered under SCA or DB, or could managers, inspectors, supervisors, office staff, etc, apply as well?


    Answer

    While the FAR clause at 52.219-3 states the percentage of the cost of personnel for contract performance to be spent for employees of the concern or employees of other HUBZone small business concerns, the clause does not address employees exempt from the specific labor acts nor does it define how the costs of personnel for contract performance are determined; a look at the law defines the term cost of the contract performance incurred for personnel, and provides a clearer understanding of the application.
     
    13 C.F.R  §125.6, Definitions, states:
    “ (2) Cost of contract performance incurred for personnel. Direct labor costs and any overhead which has only direct labor as its base, plus the concern's General and Administrative rate multiplied by the labor cost.”

    This is typically the wage rate employees and the other classification of employees addressed in the question might be exempt from the SCA or DBA but could be charged to either direct labor or burdened in the overhead rate.

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