Contract and Grant Manual

LABOR STANDARDS

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Table of Contents

12-100 INTRODUCTION AND SCOPE

12-200 FEDERAL REQUIREMENTS

12-210 REQUIREMENTS FOR PUBLIC EMPLOYERS

12-211 Fair Labor Standards Act

12-212 Drug-Free Schools and Communities Act

12-220 REQUIREMENTS FOR FEDERAL CONTRACTORS

12-221 Davis-Bacon Act

12-222 Contract Work Hours and Safety Standards Act

12-223 Service Contract Act

12-224 Walsh-Healey Public Contracts Act

12-225 Drug-Free Workplace Act

12-230 REQUIREMENTS FOR FEDERAL GRANTEES

12-231 Drug-Free Workplace Act

12-232 Hatch Act

12-240 FLOWDOWN OF LABOR STANDARDS UNDER FEDERAL CONTRACTS

12-241 Davis-Bacon Act

12-242 Contract Work Hours and Safety Standards Act

12-243 Service Contract Act

12-250 FLOWDOWN OF LABOR STANDARDS UNDER FEDERAL GRANTS

12-251 Davis-Bacon Act

12-252 Contract Work Hours and Safety Standards Act

12-300 UNIVERSITY COMPLIANCE

12-310 Fair Labor Standards Act

12-320 Davis-Bacon Act

12-330 Contract Work Hours and Safety Standards Act

12-340 Service Contract Act

12-350 Walsh-Healey Public Contracts Act

12-360 Hatch Act

12-370 Drug-Free Workplace Act

12-380 Drug-Free Schools and Communities Act

12-999 RELATED UNIVERSITY REFERENCES


12-100 INTRODUCTION AND SCOPE

Federal labor laws apply to the University in its capacities (a) as a public employer; (b) as a prime recipient of Federal contracts and grants; and (c) as an awarder of subcontracts and other agreements under Federal prime awards. With respect to labor laws and regulations governing employers and Federal contractors, the Federal interest is primarily in fair and equitable treatment of employees. With respect to labor laws and regulations governing Federal grantees, the Federal interest is primarily in the fair and equitable distribution of benefits. This Manual chapter is designed to answer the following questions:

--Insofar as the University is a public employer or a Federal contractor, what are its obligations to its employees and how does it meet those obligations?

--Insofar as the University is a Federal grantee, what are its obligations with respect to the distribution of benefits under Federal grants and how does it meet those obligations?

--Insofar as the University is a Federal contractor or grantee, what are its obligations with respect to flowing down Federal requirements in any agreements made under those Federal awards and how does it meet those obligations?

Federal labor law requirements, with the exception of requirements for affirmative action and nondiscrimination (which are covered in Chapter 14), are discussed in Sections 12-200ff; how the University fulfills those requirements is discussed in 12-300ff.

For purpose of this Manual chapter, "labor standards" are standards for University employees, subcontractors, and subrecipients. Policies and procedures relating to students, who may work on and for research contracts and grants, are not covered.

Summaries of statutes given in this chapter are for general information only; they do not address every conceivable legal issue that could arise under these laws.

12-200 FEDERAL REQUIREMENTS

12-210 REQUIREMENTS FOR PUBLIC EMPLOYERS

This section discusses Federal labor standards that apply to the University insofar as it is a public employer. These requirements are not implemented in any specific contract or grant clauses.

12-211 Fair Labor Standards Act

The Fair Labor Standards Act, 29 USC 201-6, sets minimum wage, overtime pay, equal pay, recordkeeping, and child labor standards for employees who are not exempt from certain provisions.

APPLICABILITY

The wage and hour provisions of the Fair Labor Standards Act (FLSA) apply to employees working in the U.S. that are engaged in interstate commerce or in the production of goods for interstate commerce.

The U.S. Supreme Court extended FLSA coverage to most public employees in 1985 (Garcia v. San Antonio Metropolitan Transit Authority). By statute (29 USC �203(s)), a public agency is automatically deemed to satisfy the interstate commerce test. Thus the FLSA applies to the University directly regardless of whether the University is a recipient of Federal funds. Students, however, are exempt if they are engaged in educational pursuits.

SUMMARY OF PROVISIONS

The FLSA's primary thrust is to establish minimum wage and overtime pay requirements and to restrict the use of child labor. Under the Act, there is an important distinction between those who are covered by the Act and those who are considered exempt from any or all of the Act's provisions. For example, the FLSA specifically exempts from its minimum wage and overtime coverage those employees who are "employed in a bona fide executive, administrative, or professional capacity." Such employees are called "exempt" in the University personnel system, and can be identified by their pay title codes (see 12-310). "Exempt" employees are still covered under the recordkeeping and equal pay provisions of the FLSA.

Non-exempt employees must be paid wages that meet or exceed the minimum wage requirements. They must also be paid time-and-a-half for any hours worked beyond 40 hours of actual work in a workweek. In the private sector, most employees are paid in cash for overtime. Public employees may also be paid in compensatory time rather than cash up to certain limits. For most University non-exempt employees, the limit is 240 hours of total compensatory time (earned during 160 hours of overtime worked), which may be banked for up to 6 months (or longer by exception).

The implementing regulations for the FLSA in 29 CFR Chapter 5 contain extensively detailed requirements for different kinds of industries, different regions of the country, and different kinds of employees. Sections that are of interest to the University include:

29 CFR 505 dealing with payment of minimum wage to personnel and professional performers hired under NEA and NEH grants;

29 CFR 516 dealing with records that employers are required to keep; and

29 CFR 553 dealing with the application of the Act to employees of state and local governments.

With respect to recordkeeping, the regulations in 29 CFR 516.2 require that "every employer shall maintain and preserve payroll or other records containing the following information and data with respect to each [non-exempt] employee":

(1) Name,

(2) Home address, including zip code,

(3) Date of birth, if under 19,

(4) Sex and occupation in which employed,

(5) Time of day and day of week on which the employee's workweek begins,

(6) Regular hourly rate of pay; explain basis of pay,

(7) Hours worked each workday and total hours worked each workweek,

(8) Total daily or weekly straight-time earnings,

(9) Total premium pay for overtime hours,

(10) Total additions or deductions from wage paid,

(11) Total wages paid each pay period,

(12) Date of payment and the pay period covered by payment.

Similar records, with the exception of items (6) through (10), are required for exempt employees.

The University's personnel and payroll systems are designed to record employee information required by the FLSA.

LEAD AGENCY

U.S. Department of Labor.

IMPLEMENTING REGULATION

29 CFR Chapter 5. See Section 12-310 for University implementation.

12-212 Drug-Free Schools and Communities Act

The Drug-Free Schools and Communities Act, Pub. L. 101-226, requires the adoption of drug and alcohol abuse programs by those institutions of higher education to which the Act applies. The Act applies to the University.

APPLICABILITY

The Drug-Free Schools and Communities Act applies to all institutions of higher education that receive funds or any other form of Federal financial assistance under any Federal program including participation in any Federally funded or guaranteed student loan program. The Act covers substance abuse by both employees and students.

SUMMARY OF PROVISIONS

Covered institutions must certify (on a one-time only basis) that they have adopted and implemented a program to prevent the use of illicit drugs and the abuse of alcohol by students and employees. Information on this program must be distributed to each student and employee on an annual basis. The effectiveness of the program must be reviewed by the institution every two years.

LEAD AGENCY

U.S. Department of Education.

IMPLEMENTING REGULATION

34 CFR 86. See Section 12-380 for University implementation.

12-220 REQUIREMENTS FOR FEDERAL CONTRACTORS

This section covers labor standards that may be imposed on the University through particular clauses in a Federal prime contract.

12-221 Davis-Bacon Act

The Davis-Bacon Act, 40 USC 276a - 276a-7, ensures that laborers and mechanics employed pursuant to Federally funded construction contracts, subcontracts, and construction contracts under Federal grants, will be paid prevailing wages as determined by the U.S. Secretary of Labor. See definitions, below, in Summary of Provisions.

APPLICABILITY

The Act applies to Federally funded construction contracts and subcontracts over $2,000, and to construction contracts over $2,000 awarded under Federal grants.

The Act applies to prime contractors when the clause at FAR 52.222-6, Davis-Bacon Act, is incorporated into the contract and/or when a prevailing wage determination is made a part of the construction contract.

SUMMARY OF PROVISIONS

The Act requires that contractors engaged in Federally funded construction (in contracts over $2,000) pay their workers the prevailing wage rates as determined by the U.S. Secretary of Labor (see definitions, below).

Definitions

The "prevailing wage" for a particular locality and type of work is the wage paid to the majority of laborers and mechanics in that job category working on similar projects in the area during the construction period.

"Construction, alteration, or repair" does not include servicing or maintenance work, but does include all types of work done in erecting or developing a particular building, such as remodeling, installation of items fabricated off-site, painting and decorating, the manufacturing of materials on the site, etc.

"Laborers and mechanics" include at least those workers whose duties are manual or physical in nature (including those workers who use tools or who perform the work of a trade), as distinguished from mental or managerial work. Some specific examples are plumbers, painters, carpenters, and electricians.

LEAD AGENCY

U.S. Department of Labor, Wage and Hour Division.

IMPLEMENTING REGULATION

29 CFR 5. See Section 12-320 for University implementation.

12-222 Contract Work Hours and Safety Standards Act

The Contract Work Hours and Safety Standards Act, 40 USC 327-333, ensures that laborers and mechanics employed under Federally funded agreements shall be paid a premium for work beyond 40 hours a week. (See 12-221, above, for a definition of "laborers and mechanics.")

APPLICABILITY

The Act applies to any prime contract awarded by a Federal agency, or any Federally funded subcontract or contract under a Federal grant, that may require or involve the employment of laborers or mechanics, except for:

--construction contracts of $2,000 or less or other contracts of $2,500 or less;

--contracts for supplies, materials or articles ordinarily available in the open market;

--contracts for transportation by land, air, or water, or for the transmission of intelligence;

--contracts to be performed solely within a foreign country;

--contracts requiring work to be done solely in accordance with the Walsh-Healey Act (see 12-224);

--supply contracts that do not require substantial employment of laborers or mechanics; and

--any other contract exempt under U.S. Department of Labor regulations at 29 CFR 5.15.

The Act applies to prime contractors when the clause at FAR 52.222-4, Contract Work Hours and Safety Standards Act--Overtime Compensation, is incorporated into the contract. Prime contractors are in turn required to flow down the clause in all subcontracts.

SUMMARY OF PROVISIONS

The Act requires that laborers or mechanics who work more than 40 hours in a week under a covered contract be paid at least time-and-a-half. Contractors in violation may be liable for unpaid wages and for liquidated damages. The implementing regulations require contractors subject to the Act to maintain records to document compliance.

LEAD AGENCY

U.S. Department of Labor.

IMPLEMENTING REGULATION

29 CFR 5. See Section 12-330 for University implementation.

12-223 Service Contract Act

The Service Contract Act, 41 USC 351 et seq., extends Federal minimum wage, fringe benefit, and working condition standards to Federal contractors and subcontractors who enter into service contracts which are covered by the Act as discussed in APPLICABILITY, below.

APPLICABILITY

This Act generally applies to all contracts of Federal agencies, including those with the University, which meet ALL of the following criteria:

--The principal purpose of the contract is to furnish services. Though the Act does not define "services," the U.S. Department of Labor's implementing regulation (see "Implementing Regulation," below) provides examples of the types of covered services. Pursuant to these examples, the "covered" services which are most likely to be encountered in the University's contract and grant administration function include: chemical testing and analysis; computer services; data collection, processing, and/or analysis services; geological field surveys and testing; surveying and mapping services (not directly related to construction); and telephone and field interview services. If the principal purpose of the contract is to provide something other than services, such as basic research, and the performance of services is only incidental to the contract's principal purpose, the Act does not apply.

--Services to be provided through the contract will be furnished to a "significant or substantial extent" by service employees. Service employee means any person engaged in the performance of a contract the principal purpose of which is to furnish services, other than any person employed in a bona fide executive, administrative, or professional capacity as defined at 29 CFR Part 541.

--The contract services are to be furnished in any state, the District of Columbia, Puerto Rico, the Virgin Islands, Outer Continental Shelf lands, American Samoa, Guam, Wake Island, Eniwetok, Kwajalein, and Johnston Island.

It is rare that the University would receive a contract meeting all of these criteria.

The Service Contract Act does not apply to Federal construction contracts which are covered by the Davis-Bacon Act (see 12-221) or to Federal supply contracts which are covered by the Walsh-Healey Act (see 12-224).

The Act applies to prime contractors and subcontractors when the clause at FAR 52.222-40, Service Contract Act of 1965, as Amended--Contracts of $2,500 or Less, or the clause at FAR 52.222-41, Service Contract Act of 1965, As Amended, is incorporated in the contract.

SUMMARY OF PROVISIONS

Local Prevailing Wage Rates and Benefits - Service employees paid under the contract must receive salary rates and benefits which conform to the U.S. Department of Labor's determination of local prevailing wages and benefits for the same employee class. (See 12-320 for details on obtaining information on prevailing wage rates.)

Minimum Wages - In the absence of a wage determination for certain classes of employees, those employees may not be paid less than the minimum wage established under the Fair Labor Standards Act (see 12-211).

Wage Offset for Benefits - Employees who are ineligible for health insurance must be furnished with equivalent benefits or cash equivalent. Average health and welfare benefits must equal the U.S. Department of Labor's determination of fringe benefit costs. Information on such prevailing wage and benefit rates must be supplied to employees.

Premium Overtime - Service employees under the contract are required to be paid premium overtime at 1.5 times salary after 40 hours of work per week.

Pay Period - Service employees under the contract must be paid at least on a semi-monthly basis.

Health and Safety - Working conditions must meet health and safety standards under 29 CFR Part 1925.

Recordkeeping - Records must be kept for three years and are subject to investigation by the U.S. Department of Labor.

Enforcement - The U.S. Department of Labor has enforcement powers, including debarment, to correct contractor violations.

LEAD AGENCY

U.S. Department of Labor.

IMPLEMENTING REGULATION

29 CFR Part 4, Labor Standards for Federal Service Contracts. See Section 12-340 for University implementation.

12-224 Walsh-Healey Public Contracts Act

The Walsh-Healey Public Contracts Act, 41 USC 35-45, ensures that workers under prime government supply contracts awarded to manufacturers or regular dealers of materials, supplies, or equipment are paid wages that are not less than those determined by the Secretary of Labor. It also specifies the kinds of workers that are exempt from the Act.

APPLICABILITY

The Walsh-Healey Act applies to prime government supply contracts over $10,000 that are not exempt from the Act, either by the statute itself or by regulation (41 CFR 50-201.603). The contractor must be a manufacturer or regular dealer of materials, supplies, or equipment, as defined in 41 CFR 50-206.51 et seq. Workers exempted include learners, student learners, apprentices, and handicapped workers.

The Act applies to Federal prime contractors when the clause at FAR 52.222-20, Walsh-Healey Public Contracts Act, is incorporated in the contract.

SUMMARY OF PROVISIONS

The Act makes certain supply contractors (who are manufacturers or regular dealers) subject to the minimum wage requirements. These contractors must pay at least the Federal minimum wage to their employees, with the exception of student learners, apprentices, and handicapped workers.

LEAD AGENCY

U.S. Department of Labor.

IMPLEMENTING REGULATION

41 CFR 50-201 and 50-206. See Section 12-350 for University implementation.

12-225 Drug-Free Workplace Act

The Drug-Free Workplace Act, Pub.L. 100-690, Title V, Subtitle D, requires Federal contractors and grantees to establish drug awareness programs and to promote a drug-free working environment.

APPLICABILITY

The Drug-Free Workplace Act applies to (1) employees supported under Federal procurement contracts subject to the FAR that are over $25,000 and that are awarded or modified on or after March 18, 1989; and (2) to employees supported under Federal grants effective March 18, 1989.

SUMMARY OF PROVISIONS

Contractors and grantees subject to the Act must certify in each proposal or application for Federal support that they will maintain a drug-free workplace, and in particular will:

--Publish a policy statement requiring notification of employees supported under covered transactions that the unlawful manufacture, distribution, dispensing, possession or use of a controlled substance is prohibited in the workplace and specifying the actions that will be taken against such employees for violations of such prohibition;

--Establish a drug-free awareness program to inform employees about:

(i) the dangers of drug abuse in the workplace;

(ii) the contractor's (or grantee's) policy of maintaining a drug-free workplace;

(iii) any available drug counseling, rehabilitation, and employee assistance programs; and

(iv) the penalties that may be imposed upon employees for drug abuse violations occurring in the workplace.

In addition, the Act requires employees working under covered awards to agree to abide by the policy and to notify the employer within five days of a conviction for a drug offense occurring at the workplace. The contractor/grantee is in turn required to notify the sponsoring agency of employee convictions within ten working days of notice from the employee.

LEAD AGENCY

Office of Management and Budget.

IMPLEMENTING REGULATION

48 CFR 52.2 (FAR 52.223-5, Certification Regarding a Drug-Free Workplace). These provisions are not required to be flowed down in subagreements. See Section 12-370 for University implementation.

12-230 REQUIREMENTS FOR FEDERAL GRANTEES

This section covers labor standards that are typically imposed on recipients of Federal grants and cooperative agreements, either through a common rule published in the Code of Federal Regulations (CFR) or OMB Circular A-110, Uniform Administrative Requirements for Grants and Other Agreements with Institutions of Higher Education, Hospitals, and Other Nonprofit Organizations.

12-231 Drug-Free Workplace Act

The requirements are the same as for Federal contractors. See 12-225.

For grants and cooperative agreements, these requirements are implemented via a common rule incorporated in various agency CFR parts. For the major agencies these are 45 CFR 76 (HHS); 45 CFR 620 (NSF); 10 CFR 1036 (DOE); 32 CFR 28 (DoD); and 14 CFR 1265 (NASA).

12-232 Hatch Act

The Hatch Act, 5 USC 1501-1508 and 7324-7328, places restrictions on the political activities of public employees involved in programs supported by Federal assistance funds.

APPLICABILITY

The Hatch Act applies to state and local officers or employees whose principal employment is in connection with activity financed by Federal government loans or grants. Employees of educational institutions are statutorily exempt under the original statute.

SUMMARY OF PROVISIONS

Employees covered by the Act are prohibited from: (1) using their official position or influence to affect the outcome of an election or nomination; (2) soliciting contributions for political purposes from other state and local employees; and (3) being a candidate of a major political party for elective office.

LEAD AGENCY

Office of Personnel Management.

IMPLEMENTING REGULATION

5 CFR 151. See Section 12-360 for University implementation.

12-240 FLOWDOWN OF LABOR STANDARDS UNDER FEDERAL CONTRACTS

12-241 Davis-Bacon Act

Subcontracts under Federal contracts that contain FAR clause 52.222-6 or are otherwise subject to the provisions of Davis-Bacon must flow down the Davis-Bacon requirements whenever the subcontract is for more than $2,000 and is for construction, alteration, or repairs. Campus and Laboratory officials responsible for negotiating and executing such agreements must ensure that the provisions of the Act are flowed down.

The Facilities Manual, Text, Section C-1.13, is being revised to contain boilerplate language for use in Federally funded construction contracts awarded by the University and that contain a prevailing wage determination as an attachment to the contract.

12-242 Contract Work Hours and Safety Standards Act

Campus and Laboratory officials responsible for negotiating and executing Federally funded agreements for construction must ensure that subcontractors comply with the applicable provisions of the Act. Purchasing Managers and others responsible for negotiating subcontracts under prime government contracts that involve laborers or mechanics must ensure that the clause at FAR 52.222-4 is flowed down when applicable. Appropriate instructions are found in the Facilities Manual, LF: General Conditions, Article 14.6.1; University of California Terms and Conditions for Agreement for Services, Appendix D.

12-243 Service Contract Act

The implementing clause at FAR 52.222-41 is required to be flowed down in subcontracts involving the provision of services and which would be subject to the Service Contract Act if they were funded directly by a prime Federal contract.

12-250 FLOWDOWN OF LABOR STANDARDS UNDER FEDERAL GRANTS

12-251 Davis-Bacon Act

Agreements under Federal grants subject to OMB Circular A-110 must flow down the Davis-Bacon requirements whenever the agreement is for more than $2,000 and is for construction, alteration, or repairs. Campus and Laboratory officials responsible for negotiating and executing such agreements must ensure that the provisions of the Act are flowed down when applicable, as described in OMB Circular A-110, Appendix A, #3.

The Facilities Manual, Text, Section C-1.13, is being revised to contain boilerplate language for use in Federally funded construction contracts awarded by the University and that contain a prevailing wage determination as an attachment to the contract.

12-252 Contract Work Hours and Safety Standards Act

Campus and Laboratory officials responsible for negotiating and executing Federally funded agreements for construction must ensure that subcontractors comply with the applicable provisions of the Act. Purchasing Managers and others responsible for negotiating contracts under Federal grants that involve laborers or mechanics must ensure that the provisions of the Act are flowed down when applicable, as described in OMB Circular A-110, Appendix A, #4. Appropriate instructions are found in the Facilities Manual, LF: General Conditions, Article 14.6.1; University of California Terms and Conditions for Agreement for Services, Appendix D.

12-300 UNIVERSITY COMPLIANCE

The following sections address University compliance with the requirements discussed above in Sections 12-200ff.

12-310 FAIR LABOR STANDARDS ACT

The Office of the President, Office of Employee and Labor Relations, is responsible for making sure that University personnel policies and procedures comply with the FLSA. That office has indicated that the University does pay at least minimum wage to all non-exempt employees and that University personnel and payroll recordkeeping systems meet the recordkeeping standards of the Act.

University employees who are subject to the provisions of the Fair Labor Standards Act are called non-exempt employees and employees not subject to the Act are called exempt employees. Non-exempt employees must be paid for work over 40 hours of actual work in a workweek at one and one-half times their regular rate of pay.

Exemption status for staff titles is found in the Staff Title and Pay Plan, located in department or local staff personnel offices. Non-exempt pay titles are marked N after the heading OES (Overtime Exemption Status). OES codes A, E, G, P and S indicate exempt pay titles.

There are no specific clauses or assurances pertaining to the FLSA required to be inserted in solicitations or subawards made under Federally funded contracts and grants.

12-320 DAVIS-BACON ACT

The Office of the President, Office of Facilities Administration, is responsible for making sure that University policies and standard form contract language comply with the Davis-Bacon Act. The Facilities Manual, Text, Section C-1.13, is being revised to contain boilerplate language for use in Federally funded construction contracts awarded by the University and that contain a prevailing wage determination as an attachment to the contract.

Since the University is not in the construction business, it is unlikely to be awarded a prime construction contract by a Federal agency. However, the University does occasionally receive a Federal research grant under which the University may contract out for the construction, alteration, or repair of buildings. When these construction agreements are in excess of $2,000, the provisions of the Davis-Bacon Act must be applied to the contractor doing the work.

Although the University has a number of pay titles that would include "laborers and mechanics," the Davis-Bacon Act would not apply to these employees when construction is incidental to the performance of the award. The Davis-Bacon Act would apply if these employees are paid for work done under a Federal award to the University which is expressly for construction.

Contracts that contain FAR clause 52.222-6 or otherwise are subject to the provisions of Davis-Bacon must contain wage determinations specific to that agreement, usually obtained from the Contracting Officer or grants administrator, who in turn has the option to use the applicable published wage determination, if there is one, or to request a specific determination from the U.S. Department of Labor using Standard form 308. A listing of the applicable prevailing rates must be prominently displayed at the work site.

Determinations of the prevailing wage for particular types of construction within specified geographical areas are published as needed in the Federal Register by the U.S. Department of Commerce, Wage and Hour Division. They also are published weekly by the Government Printing Office in its publication "General Wage Determinations Issued Under the Davis-Bacon and Related Acts." This publication is available from the GPO (Washington, DC 20402) or in most Government Depository Libraries (including main libraries at all University campuses except San Francisco).

Based on a sample comparison of University of California wage rates and Federal rates, the two appear to be in substantial agreement. The University, for example, in 1992 paid a painter at the Berkeley campus $22.12 per hour (title 8198) and the Federal prevailing wage for that category in Alameda County for the same period was $21.47. For plumbers-pipefitters (title 8191) the University wage was $23.05 in Berkeley in 1992, and the comparable Federal rate was $21.88. If "laborers or mechanics" are charged to a Federal construction award, compliance with prevailing wage rates may be determined by comparing the University wage rate to the Federal prevailing wage rate for the applicable labor category.

12-330 CONTRACT WORK HOURS AND SAFETY STANDARDS ACT

In general, with respect to its own employees, the University complies with the provisions of this Act in virtue of its compliance with the broader provisions of the Fair Labor Standards Act (see 12-310). For information on how the University ensures that the provisions of the Act are flowed down to subcontractors under Federal contracts and grants, see 12-242 and 12-252, above.

12-340 SERVICE CONTRACT ACT

The primary responsibility for judging if a contract falls under the provisions of the Service Contract Act, and if a particular contract which does fall within such provisions is acceptable to the University, rests with Contract and Grant Officers.

If the University should enter into a contract subject to the provisions of the Service Contract Act, it is the primary responsibility of the hiring department in consultation with the department's Employee Relations Specialist to ensure that the University complies with the provisions of the Act. If, for example, all University employees to be paid under the contract are "non-exempt" (see 12-310), paid bi-weekly, and eligible for full University benefits, then the only question would be whether the wages paid meet the "prevailing wage" standards for each funded position. The prevailing wages for each location and type of work should be specified in the contract (or in an attachment to the contract) by the Contracting Officer. See 12-320 for details on how to obtain information on general wage determinations, which would give a rough idea of the applicable prevailing wages.

It is the University's usual practice not to enter into a contract which falls within the provisions of the Service Contract Act because the University's payroll and personnel systems and policies have not been written specifically to be in compliance with all the provisions of the Act, particularly the "prevailing wage" standard. The administrative burden required to determine in a particular case whether the University is in compliance, and will continue to be in compliance throughout the life of the contract, could be great. Acceptance of Service Contract Act requirements may be considered by Contract and Grant Officers on a case-by-case basis, taking into account the value of a project to the University vs. the administrative burden and costs the contract would impose.

Service contracts awarded by the University that are subject to Federal prevailing wage requirements are to be administered in accordance with Business and Finance Bulletin BUS-43, Part 3.

12-350 WALSH-HEALEY PUBLIC CONTRACTS ACT

Since the University is not a manufacturer or regular dealer of materials, supplies, or equipment, the Act does not apply to University employees. Contract and Grant Officers should ensure that references to the Walsh-Healey Act are not accepted, or are made not applicable to the University, in extramurally-funded contracts.

12-360 HATCH ACT

When asked to certify compliance with the Hatch Act, Contract and Grant Officers may rely on the statutory exemption for educational institutions to indicate to the sponsoring agency that the Hatch Act is not applicable to the University. In the unlikely event that a sponsor questions this exemption on the grounds that certain individuals budgeted to work on the proposed project are State employees and technically not "employees of the University," then advice should be sought from the Office of the General Counsel and Vice President for Legal Affairs.

12-370 DRUG-FREE WORKPLACE ACT

The Assistant Vice President--Employee and Labor Relations is primarily responsible for developing the University policy on substance abuse and for issuing implementing guidelines. (See University of California Policy on Substance Abuse, November 1, 1990, and Implementing Guidelines for the University of California Policy on Substance Abuse, December 10, 1990.)

Chancellors and Laboratory Directors are responsible for issuing instructions for implementing the provisions of the University policy on substance abuse. Generally the campus or Laboratory Contract and Grant Officer is the designated official to sign certifications required in proposals and applications for Federal awards.

Guidance and background materials regarding the Drug-Free Workplace Act are disseminated via Contract and Grant Memo and Information Letter.

12-380 DRUG-FREE SCHOOLS AND COMMUNITIES ACT

The Assistant Vice President--Employee and Labor Relations is primarily responsible for developing the University policy on substance abuse and for issuing implementing guidelines. (See University of California Policy on Substance Abuse, November 1, 1990, and Implementing Guidelines for the University of California Policy on Substance Abuse, December 10, 1990.)

Chancellors and Laboratory Directors are responsible for issuing instructions for implementing the provisions of the University policy on substance abuse. Certification of compliance with the Drug-Free Schools and Communities Act is required on a one-time only basis and has been submitted by each campus to the U.S. Department of Education.

Guidance and background materials regarding the Drug-Free Schools and Communities Act are disseminated via Contract and Grant Memo and Information Letter.

12-999 RELATED UNIVERSITY REFERENCES

  • Academic Personnel Manual

  • Executive Program Personnel Manual

  • Management and Professional Program Personnel Manual

  • Administrative and Professional Staff Program Personnel Manual

  • Staff Personnel Manual

  • University collective bargaining agreements

  • Facilities Manual

  • Applicable personnel policy implementing guidelines

  • Business and Finance Bulletin BUS-43, Materiel Management

  • University of California Policy on Substance Abuse, November 1, 1990, and Implementing Guidelines for the University of California Policy on Substance Abuse, December 10, 1990