Rate Increase Announced for SCA Health and Welfare Fringe Benefits

Last week the U.S. Department of Labor released its annual memorandum noting a rate increase for Service Contract Act (SCA) Health and Welfare Fringe Benefits. The new rate is $3.50 per hour (up from $3.35 per hour last year) and a special rate of $1.42 for Hawaii, up from $1.40 per hour last year. This rate increase takes effect June 22, 2010. SCA benefit change notices are not sent directly to contractors or subcontractors, so we wanted to make sure our SCA contractor clients were aware of this rate increase. A copy of the memorandum can be viewed here.

Solicitations and Contracts which are affected include:

• All invitations for bids opened or other service contracts awarded on or after June 22, 2010, must include the new fringe benefit via an updated Wage Determination (WD).
• For contracts beginning on or after June 22, 2010, the new fringe benefit must be included via pen and ink changes to the current WD.
• For all other contracts (not those awarded or starting post June 22, 2010), revised wage determinations reflecting the new fringe benefit rate will be available at the Wage Determination OnLine website (www.wdol.gov) on or soon after June 22, 2010. The new rate will go into effect on the anniversary date (annual, or every two years), or the option renewal/modification date of these contracts – whichever date for a particular contract triggers incorporation of a new WD by the contracting agency.