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Eric Herendeen is an associate in the Government Contracts Group in Crowell & Moring’s Washington, D.C. office. He advises clients on a wide array of performance dispute issues, including requests for equitable adjustments, CDA claims, cost allowability issues, and prime-sub disputes. He has represented clients before the Civilian Board of Contract Appeals, Armed Services Board of Contract Appeals, and the U.S. Court of Appeals for the Federal Circuit. In addition to his disputes and litigation practice, Eric has also counseled clients through internal investigations to support disclosures to the government and to advocate before the Department of Justice on False Claims Act matters.

The Department of Labor (“DOL”) recently announced in a July 29, 2022 Change Order notice that the Wage and Hour Division (“WHD”) had revised the Field Operations Handbook (“FOH”) by deleting the exemption under the Service Contract Act (“SCA”) for federal contracts to operate Job Corps Centers.  Prime contractors and subcontractors operating these centers will now be subject to the SCA and FAR 52.222-41, Service Contract Labor Standards, according to DOL. 

The practical effect of this change is that covered contractors must pay the minimum wages and “bona fide” fringe benefits mandated by the SCA to all covered workers, which includes workers who are “non-exempt” under the Fair Labor Standards Act.  The required wages and fringe benefits for these workers are set forth in wage determinations that are incorporated into the applicable contract by the contracting agency.  Higher tier contractors must also flow down the SCA Clause (FAR 52.222-41) and all applicable wage determinations to lower tier contractors.  All covered contractors must meet the SCA’s posting and recordkeeping requirements.  See 29 CFR 4.183, Employees must be notified of compensation required; 29 CFR 4.184, Posting of notice; 29 CFR 4.185, Recordkeeping requirements.    

Continue Reading Job Corps Center Prime Contractors Will Now be Subject to the Service Contract Act Requirements

In Tolliver Group, Inc. v. United States, No. 2020-2341, 2021 WL 5872256 (Fed. Cir. Dec. 13, 2021), the Federal Circuit vacated and remanded the Court of Federal Claims’ (“COFC”) decision holding that the contractor was entitled to an equitable adjustment for damages caused by the Government’s breach of the implied warranty that satisfactory contract