FEDCON Summit: Labor Laws & Affirmative Action for Federal Contracts

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  • 1. LABOR LAWS AND AFFIRMATIVE ACTION CONSIDERATIONS IN FEDERAL CONTRACTS NCMBC FEDCON SUMMIT Wilmington, NC October 16-17, 2013 Rolly Chambers Smith, Currie & Hancock LLP Charlotte, NC RLChambers@smithcurrie.com 704-334-3459
  • 2. Labor Laws and Federal Contracts Overview ž  Federal government implements socioeconomic policies through its contracts ž  Cost of doing federal business = following government contracting policies ž  Build in admin overhead expenses
  • 3. Labor Laws and Federal Contracts Overview ž  Legal sources – statutes, regulations, orders ž  Statutes – U.S. Code (U.S.C.) —  Legislation enacted by Congress ž  Regulations – rules adopted by agencies —  Code of Federal Regulations (CFR) —  Federal Acquisition Regulations (FAR) ž  Executive orders – order issued by president
  • 4. Labor Laws and Federal Contracts Federal Prevailing Wage Policies ž  Davis-Bacon Act: 40 U.S.C. § 3141, et seq. —  Federal construction contracts where total value is $2000 or more —  Payment of “prevailing wages” to workers on federal construction projects ○  Wage Determinations set prevailing wages ○  Each contract includes a wage determination ○  Set by geographic area and job classification
  • 5. Labor Laws and Federal Contracts Federal Prevailing Wage Policies ž  Davis-Bacon Act: 40 U.S.C. § 3141, et seq. —  Flow down - Subs must pay workers the wage in the Wage Determination —  Certified payrolls —  Enforcement penalties ○  Contract termination and debarment ○  Liability for unpaid wages and liquidated damages ○  Fines/imprisonment for false certified payrolls
  • 6. Labor Laws and Federal Contracts Federal Prevailing Wage Policies ž  Contract Work Hours and Safety Standards Act: 40 U.S.C. § 3701, et seq. —  Applies to all federal contracts employing laborers or mechanics on public works —  Provides for overtime pay ○  1.5 x wage rate for hours worked above 40 hr./week —  Flow down – applies to subs —  Enforcement penalties ○  Withholding to pay required overtime ○  LD’s - $10 per day per worker for overtime not paid
  • 7. Labor Laws and Federal Contracts Federal Prevailing Wage Policies ž  Walsh-Healey Public Contracts Act: 41 U.S.C. §6501, et seq. —  Applies to contracts for manufacture or furnishing of materials, supplies, equipment, etc. > $10,000 —  Workers paid prevailing wage ○  Set by Wage Determination —  No child labor or prison labor —  Poster display —  Enforcement penalties ○  LD’s - $10 per day per worker for overtime not paid ○  Potential Imprisonment
  • 8. Labor Laws and Federal Contracts Federal Prevailing Wage Policies ž  Service seq. Contract Act: 41 U.S.C. § 351, et —  Applies to service contracts —  Construction and professional services contracts exempt —  Workers paid prevailing wage and benefits ○  DOL makes Wage Determination —  Enforcement penalties ○  Liability for underpayments ○  Contract termination; debarment
  • 9. Labor Laws and Federal Contracts Federal Prevailing Wage Policies ž  Dept. of Labor resources —  http://www.dol.gov/compliance/index.htm - Help Navigating DOL Laws and Regulations; and —  http://www.dol.gov/compliance/guide/ index.htm - Employment Law Guide: Laws, Regulations, and Technical Assistance Services.
  • 10. Labor Laws and Federal Contracts Risks of Non-Compliance ž  Summary —  Non-compliance has a high price —  Penalties are severe ○  Withholding of contract funds ○  Suspension ○  False Claims Act liability – treble damages ○  Possible Fines and Imprisonment —  Compliance is the right way to go
  • 11. Labor Laws and Federal Contracts Thanks Rolly Chambers Smith, Currie & Hancock LLP 5701 Westpark Dr., Suite 204 Charlotte, NC 28217 rlchambers@smithcurrie.com 704-334-3459