New Fringe Rates for SCA Contracts
The Wage and Hour Division of the U.S. Department of Labor has released the new fringe rates for 2019/2020 for all contracts and contractors under the Service Contract Act.
Per All Agency Memorandum 230, the rate for any prevailing health and welfare fringe benefits issued under the SCA will increased to $4.54 per hour. This is a modest increase from last year’s fringe benefit rate of $4.48 per hour. The new fringe rate is effective as of July 5, 2019.
This information can be found on the Wage Determination and WHD websites.
Grandfathered Benefit Continues
In 2004, the WHD announced in All Agency Memorandum 197 that it would increase the fringe benefit rate for all wage determinations and retain the two different methods for determining compliance. That policy will continue this year.
Both the employee-by-employee benefit and average cost fringe benefit rates will be $4.54 per hour, up to 40 hours per week (which is $181.60 per week, or $786.93 per month). Consistent with longstanding policy, the average cost fringe benefit wage determination will be issued only contracts in which the formerly grandfathered benefit rate would have applied
Don’t Forget EO 13706
Executive Order 13706, Establishing Paid Sick Leave for Federal Contractors, requires that employers that contract with the federal government provide their employees with up to 56 hours of paid sick leave annually; this comes out to seven days paid sick leave. This rule applies to “new” government contracts entered into on or after the Executive Order’s effective date, January 1, 2017. This paid leave can also be applied to family care and any employee absences that occur as a result of domestic violence, sexual assault, and stalking.
Compliance. We got this.
At Boon, we understand that compliance is crucial and it’s our job to navigate the changing landscape so that you don’t have to. Click here to learn more about our comprehensive compliance services.
Our ability to create flexible plans that are customized to the fringe keeps you compliant and covered in the most cost-efficient way. Check out this post to learn more!
Check out the rest of our blog for more information on employee benefit options and compliance! We’re your link to benefits.
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