The Service Contract Act (SCA) is a federal law that applies to contracts entered into by the United States government for the provision of services. The purpose of the law is to ensure that workers on these contracts are paid fair wages and benefits, and that the government is not indirectly subsidizing low-wage jobs.
One important provision of the SCA is Section 4(c), which requires that contractors and subcontractors on covered contracts submit certified payroll records to the government. These records must include information on the wages paid to each worker, as well as any fringe benefits provided.
The purpose of this requirement is to ensure that workers on SCA contracts are being paid the prevailing wage for their job category and geographic location. The prevailing wage is determined by the U.S. Department of Labor and is based on the average wage paid to workers in the same job category in the same geographic area.
By requiring contractors to submit certified payroll records, the government can monitor compliance with the SCA`s wage and benefit requirements. If a contractor is found to be in violation of the law, they may be subject to back pay and penalties, as well as potential removal from the list of eligible contractors for future government contracts.
It`s important for contractors and subcontractors working on SCA contracts to understand their obligations under Section 4(c) of the law. They should maintain accurate payroll records and be prepared to provide them to the government upon request. They should also be aware of the prevailing wage rates for their job categories and geographic locations and ensure that they are paying their workers accordingly.
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