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SCA Compliance Gains Attention

August 30, 2011 Written by: Written by Kevin Frankovich, CGR Associates

The importance of complying with the SCA on covered projects has gained attention following a D.C. District Court judge’s recent denial of a motion to dismiss a False Claims Act case in which failure to pay workers SCA wage rates is a substantial component.

The case involves Maryland-based “The Kane Company”, which provides office-moving services to both government and corporate clients. A former employee of The Kane Company alleges that he became aware of the company’s failure to comply with SCA, and that the company continued to ignore its obligations under SCA even after the issue was brought to their attention.

The former employee, Anthony Head, alleged that The Kane Company had submitted several false invoices over the course of ten years which reflected that the company was, in fact, paying its workers at least the minimum wages required by the SCA. The judge in the case allowed the False Claims Act charges to go forward on the grounds that the invoices submitted were false. If Kane is found liable, it faces a penalty of up to $11,000 for each false invoice, plus three times the amount of each false invoice.