[Federal Register Volume 70, Number 109 (Wednesday, June 8, 2005)]
[Rules and Regulations]
[Pages 33662-33671]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 05-11186]


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DEPARTMENT OF DEFENSE

GENERAL SERVICES ADMINISTRATION

NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

48 CFR Parts 22, 52, and 53

[FAC 2005-04; FAR Case 2002-004; Item VI]
RIN 9000-AJ79


Federal Acquisition Regulation; Labor Standards for Contracts 
Involving Construction

AGENCIES: Department of Defense (DoD), General Services Administration 
(GSA), and National Aeronautics and Space Administration (NASA).

ACTION: Final rule.

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SUMMARY: The Civilian Agency Acquisition Council and the Defense 
Acquisition Regulations Council (Councils) have agreed on a final rule 
amending the Federal Acquisition Regulation (FAR) to implement the 
revised definitions of ``construction'' and ``site of the work'' in the 
Department of Labor (DoL) regulations. In addition, the Councils have 
clarified several definitions relating to labor standards for contracts 
involving construction and made requirements for flow down of labor 
clauses more precise.

DATES: Effective Date: July 8, 2005.

FOR FURTHER INFORMATION CONTACT: The FAR Secretariat at (202) 501-4755 
for information pertaining to status or publication schedules. For 
clarification of content, contact Ms. Linda Nelson, Procurement 
Analyst, at (202) 501-1900. The TTY Federal Relay Number for further 
information is 1-800-877-8973. Please cite FAC 2005-04, FAR case 2002-
004.

SUPPLEMENTARY INFORMATION:

A. Background

    This final rule constitutes the implementation in the FAR of the 
DoL rule revising the terms ``construction, prosecution, completion or 
repair'' (29 CFR 5.2(j) and ``site of the work'' (29 CFR 5.2(l)). The 
DoL final rule (65 FR 80268) was published on December 23, 2000, and 
became effective on January 19, 2001. In addition, the Councils have 
clarified several definitions relating to labor standards for contracts 
involving construction and made requirements for flow down of labor 
clauses more precise.
    The proposed rule was published in the Federal Register at 68 FR 
74403, December 23, 2003. The Councils received comments in response to 
the proposed rule from 161 respondents. Responses to the more 
significant comments are as follows:
    1. Support extension of Davis-Bacon Act (DBA) to secondary sites of 
the work.
    The first category includes general comments in support of 
extending the DBA to secondary sites for various reasons. Among the 
reasons under this category given by the respondents in support of the 
rule are because it:
     Helps workers;
     Prevents companies from circumventing the DBA;
     Addresses the realities of new construction techniques in 
the construction industry;
     Correctly implements DoL final rule, which is not 
inconsistent with previous court cases.
    The Councils concur. No further response is necessary.
    2. Oppose the extension of the DBA to secondary sites.
    Many respondents opposed extension of the DBA to a secondary site, 
because--
     It is too difficult to administer-confusing, burdensome, 
beyond logistic capability;
     It will increase costs of construction;
     Court decisions demonstrate that the DoL rule is invalid;
     The Councils have the authority to reject the DoL rule; or
     The respondent opposes the DBA entirely. Let the market 
prevail.
    The Councils do not concur. It is apparent that many of the 
respondents misunderstood the concept of the ``secondary site of the 
work''. This concept only includes a site where ``a significant portion 
of the building or work is constructed.'' This does not cover the 
manufacture or sale of construction material to be used at the site, 
but only actual construction that is unique and integrally related to 
the final building or work. The Councils anticipate that very few 
construction projects will have a secondary site of the work.
    With regard to increased cost to the contractor, this is not 
necessarily the case because the contractor should take all the labor 
costs into consideration in submitting his offer. With regard to 
increased cost to the Government, this is a benefit to the workers that 
the Government is willing to provide in accordance with the law.
    Questions as to the validity of the DoL rule are outside the scope 
of this case. This rule implements the DoL rule, which has already been 
subject to notice and comment.
    Comments regarding the benefits and value of the DBA itself are 
also outside the scope of this case.
    3. Oppose retroactive application of wage rates at secondary site, 
without change in contract price or estimated cost.
    Many respondents considered that this so-called ``retroactive'' 
aspect of the FAR rule was unfair to contractors, and goes beyond the 
DoL rule. These respondents were concerned about the term ``retroactive 
application'' which was used in the preamble to the proposed rule. 
These respondents mistakenly interpreted ``retroactive'' in this 
context to mean that the DBA rates would be applied retroactively to 
secondary sites on existing contracts. One respondent stated that the 
rule would require back pay through the year 2000 (effective date of 
the DoL rule) for secondary sites of current projects and pay in future 
payrolls at secondary sites through the remainder of the term of the 
contract. Combined with the misapprehension about what constitutes a 
secondary site, the small businesses fear bankruptcy with the 
implementation of the DoL rule in the FAR.
    The Councils do not concur. The FAR rule is not retroactive. It 
does not apply to existing contracts or projects. It only applies to 
new solicitations or contracts entered into after the effective date of 
the FAR rule. See FAR 1.108(d). If these clauses were incorporated into 
a contract retroactively, then there would be an appropriate adjustment 
to the contract price. In new solicitations issued after the effective 
date of this rule, the contractor is forewarned that the DBA is 
applicable to the secondary site of the work pursuant to the 
solicitation provision 52.222-5, Davis-Bacon Act--Secondary Site of the 
Work. Moreover, the contract clause 52.222-6,

[[Page 33663]]

Davis-Bacon Act, also stipulates that DBA coverage extends ``to any 
other site where a significant portion of the building or work is 
constructed, provided that such site is located in the United States 
and established specifically for the performance of the contract or 
project.'' This regulatory language is intended to force contractors to 
come forward if they intend to use a secondary site. DoL says these 
instances should be rare. This will not be a regular occurrence. An 
example discussed in the DOL rule preamble is constructing a segment of 
a dam the size of a football field and floating it down a river. If a 
contractor intends to establish a secondary site of the work, and not 
disclose this information to the Government until after contract award 
with the preconceived objective to request a price adjustment to cover 
the increased DBA wages, this could skew the procurement process to the 
disadvantage of the other offerors. The contractor is in a position to 
anticipate the possible establishment of a secondary site of the work 
based on its entrepreneurial ability during preparation of his proposal 
or after it has been awarded the contract. The solicitation provision 
and contract clauses provide advanced and clear guidance and 
stipulations to the contractor on all the effects of a secondary site 
of work from the moment he intends to establish it.
    4. Oppose application of DBA wage rates for transportation of 
materials from secondary site of the work to primary site of the work.
    One respondent asserted that the proposed revision improperly 
covers drivers of materials for time spent transporting materials or 
pre-fabricated construction components between the newly expanded 
``secondary'' site and the traditional site of the work. Another 
respondent contended that if a wage determination is to be applied to 
workers at secondary sites, it should at least be the wage 
determination for the secondary site.
    The Councils do not concur. The Davis-Bacon Act covers 
transportation of the significant portion(s) of the public building or 
public work that were constructed at a covered secondary site of the 
work and are then moved to the primary site of the work where the 
building or work will remain when it is completed. The transportation 
of other materials and supplies between the two covered sites is not 
subject to DBA coverage, and is not provided for in the DoL rule nor 
the FAR rule. With regard to covering the transportation of a 
significant portion of the building or work between covered sites, the 
FAR rule is implementing the DoL final rule. With respect to which wage 
determinations should apply to the transportation of a significant 
portion of the building or work constructed at the secondary site of 
the work between the two covered sites, the decision to apply the wage 
determination for the primary site of the work for these situations 
represents a reasonable interpretation of the remedial purposes of the 
DBA. Even though DoL did not include in its final rule which wage 
determination was applicable in this circumstance, DoL did include in 
the preamble to the final rule, an administrative determination to 
enforce ``the wage determination for the area in which the construction 
will remain when completed.'' (See 65 FR 80276, December 20, 2000). 
This is consistent with the language included in the FAR implementation 
of the DoL rule.
    5. Councils failed to comply with the Regulatory Flexibility Act. 
Must perform Initial Regulatory Flexibility Analysis and publish it for 
public comment.
    Numerous respondents asserted that the Regulatory Flexibility Act 
requires that an analysis of the cost of this rule to small business 
must occur and be published for comment. The respondents state that the 
FAR Council has failed to comply with the Regulatory Flexibility Act 
because the rule will have a significant economic impact on small 
business. Most construction firms are small businesses (98%), and the 
retroactive aspects of the rule without any adjustment in contract 
price will have a devastating impact on small businesses.
    The Councils have reviewed the Final Regulatory Flexibility 
Analysis of the Department of Labor and support the DoL determination 
in the Final Regulatory Flexibility Analysis that its regulation would 
not have a significant economic impact on a substantial number of small 
entities (see 65 FR 80277, Dec 20, 2000). The implementation in the FAR 
is within the framework provisions of the DoL rule. For further 
analysis of impact of this final rule, see Paragraph B. of this notice, 
which addresses the Regulatory Flexibility Act.
    With regard to the so-called ``retroactive'' aspect of the FAR 
rule, which would increase the impact beyond that of the DoL rule, see 
the response to comment category 3. above.
    6. Requests for substantive changes made by various respondents to 
clarify or strengthen the rule. Some respondents suggested the 
following changes to the FAR rule:
    a. Specify in the provision that the contracting agency has the 
right to apply DBA to a site that the DoL or the agency determines to 
be a secondary site.
    b. Define what is a ``significant portion of the work''
    c. Include liquidated damages if contractor sets up a site, claims 
the site is permanent and previously established, then dismantles it at 
the end of the project.
    d. Do not require the contractor to determine the applicability of 
a wage determination.
    e. Do not limit ``site of the work'' geographically.
    The Councils respond to these suggestions as follows:
    a. The Councils do not concur. The Councils note that the DBA 
provision is directed to the offeror, requesting that the offeror 
identify any planned secondary site. It is not necessary to state in 
the provision that the contracting officer has the right to apply the 
DBA to a site that the DoL or the agency determined to be a secondary 
site because it is implicit in the law that DoL has the statutory 
authority to make this determination regarding the application of the 
DBA. Also, the contracting officer has the authority to make these 
determinations under the FAR. If a DBA wage coverage determination made 
on a secondary site by the DoL or the contracting officer is 
inconsistent, or in violation of the law, or the regulation, the 
contractor has the prerogative to administratively appeal this 
determination to the DoL Administrative Review Board in accordance with 
the FAR clause at 52.222-14, Disputes Concerning Labor Standards.
    b. The Councils do not concur. The Councils do not have the 
jurisdiction to define this concept that was introduced in the DoL 
rule. The FAR rule implements the DoL final rule. The DoL rule does not 
define ``significant portion of the work'', because in DoL's view the 
size and the nature of the specific project will dictate what 
constitutes ``a significant portion'' under the provision. If an 
offeror or the cognizant agency is unsure whether a site meets the 
criteria of secondary site of the work, the agency should consult with 
DoL.
    c. The Councils do not concur. This measure is not necessary 
because it is not possible to ``set up'' a ``previously established 
site.'' If the site was not previously established before award but 
meets the other criteria for DBA site of the work, it cannot be 
exempted from consideration as a DBA wage covered site of the work.
    d. The Councils partially concur. The final rule revises the 
provision at FAR 52.222-5, Davis-Bacon Act--Secondary

[[Page 33664]]

Site of the Work, to stipulate in paragraph (a)(2) that if the offeror 
is uncertain if a planned work site satisfies the criteria for a 
secondary site of the work, the offeror shall request a wage 
determination for a secondary site from the contracting officer. This 
is intended to reduce the instances in which the DoL comes in after the 
fact and declares a site to be a secondary site of the work. In 
addition, the Councils revised the language in paragraph (b)(1) of the 
provision to require that if the wage determination provided by the 
Government for work at the primary site of the work is not applicable 
to the secondary site of the work, the offeror shall request a wage 
determination from the contracting officer, rather than requiring the 
offeror to seek the correct wage determination on line.
    e. The Councils do not concur. The FAR rule is implementing the DoL 
final rule. DoL already considered and rejected this comment in the 
formulation of its final rule. DoL is constrained by case law.
    The Councils are also adopting other clarifying changes, of which 
the most significant change is revision of the ``site of the work'' 
definition at FAR 22.401 and in the clause at FAR 52.222-6, Davis-Bacon 
Act, to include the requirement for a secondary site of work to be 
located in the United States. The DBA does not apply outside the United 
States. This was not an issue as long as the rules did not permit a 
secondary site of the work that is geographically removed from the 
primary site of the work. If the secondary site of the work is not 
located in the United States it would not qualify for DBA coverage. 
Therefore, since the Councils have removed the statement in the DBA 
secondary site of the work provision that the offeror shall notify the 
contracting officer ``if the Davis-Bacon Act is applicable to the 
secondary site of the work, '' the definition of ``site of the work'' 
must be more restrictive.
    This is a significant regulatory action and, therefore, was subject 
to review under Section 6(b) of Executive Order 12866, Regulatory 
Planning and Review, dated September 30, 1993. This rule is not a major 
rule under 5 U.S.C. 804.

B. Regulatory Flexibility Act

    The Department of Defense, the General Services Administration, and 
the National Aeronautics and Space Administration certify that this 
final rule will not have a significant economic impact on a substantial 
number of small entities within the meaning of the Regulatory 
Flexibility Act, 5 U.S.C. 601, et seq., because the Councils support 
the DoL determination in the Final Regulatory Flexibility Analysis that 
its regulation would not have a significant economic impact on a 
substantial number of small entities (see 65 FR 80277, December 20, 
2000). The implementation in the FAR is within the framework provisions 
of the DoL rule.
    In accordance with the DoL final rule, this FAR rule requires 
contractors to pay Davis-Bacon wages at a secondary site of the work, 
if there is a secondary site of the work. A secondary site of the work 
exists only if a significant portion of the building or work is 
constructed there and the site is established specifically for the 
performance of the contract or project. This is an issue not 
contemplated under the current regulatory language. However, we concur 
with the DoL estimate that such instances will be rare. We estimate 
that this will result in a negligible increase in application of Davis-
Bacon wages, because we estimate that less than 5 sites will qualify as 
secondary sites, out of approximately 14,000 construction contracts per 
year.
    Furthermore, with regard to dedicated facilities such as 
fabrication plants, mobile factories, batch plants, borrow pits, job 
headquarters, tool yards, etc., Davis-Bacon wages will now apply only 
if the dedicated facilities are ``adjacent or virtually adjacent to the 
site of the work.'' Currently the FAR states that the dedicated 
facilities must be ``so located in proximity to the actual construction 
location that it would be reasonable to include them.'' We estimate 
that this change will result in a negligible decrease in payment of 
Davis-Bacon wages, because usually these types of dedicated facilities 
are located adjacent to the site of the work, for economic reasons as 
well as security. Usually disputes regarding dedicated facilities have 
revolved around the functional test rather than the geographic test. We 
estimate that this change in definition will impact less than 100 sites 
out of 14,000 construction contracts per year.
    Under this final rule, off-site transportation of materials, 
supplies, tools, is generally not covered. Contractors must only pay 
Davis-Bacon wage rates to employees that are transporting portions of 
the building or work between the secondary site of the work and the 
primary site of the work (an extremely rare occurrence, as stated 
above) or between the adjacent dedicated facility and the site of the 
construction. Furthermore, there are now a few less dedicated 
facilities that count as part of the ``site of the work'' and they are 
all adjacent rather than just ``in proximity''.
    We estimate that these changes with regard to transportation will 
only slightly reduce the application of Davis-Bacon wages for 
transportation, because paying Davis-Bacon wages for off-site 
transportation of materials is currently a rare occurrence. Contractors 
must currently pay Davis-Bacon wage rates if an employee of the 
construction contractor or subcontractor is transporting materials or 
supplies to or from the building or work and (in accordance with court 
decisions) such employee spends more than a ``de minimus'' amount of 
time at the site of the work. However, most suppliers deliver materials 
to the construction site (rather than using an employee of the 
construction contractor to transport) and construction contractor 
employees that are transporting such bulk materials as sand, dirt, or 
snow to or from the site usually do not spend more time at the site 
than is required for a pick-up or delivery.
    Therefore, we concur with the conclusion of the DoL that the number 
of projects affected by these changes is very limited and the 
prevailing wage implications are not substantial, especially with 
regard to the transportation activities attendant to these types of 
projects.
    There were public comments filed on the impact on small business. 
One commenter provided extensive comments which also covered particular 
nuances of the Regulatory Flexibility Act not covered by other 
commenters. The substance of these comments has been addressed above in 
the discussion of public comments in Section A., paragraphs 3. through 
5.

C. Executive Order 12866; Small Business Regulatory Enforcement 
Fairness Act; Unfunded Mandates Reform Act

    Because of the interests expressed by some commenters, the final 
rule is nonetheless being treated as a significant rule. However, the 
rule is not economically significant and does not require preparation 
of a full regulatory impact analysis. This rule implements a Department 
of Labor rule which was not expected to have an annual effect on the 
economy of $100 million or more or adversely affect in a material way 
the economy, a section of the economy, productivity, competition, jobs, 
the environment, public health or safety, or State, local, or tribal 
governments or communities. Therefore this rule also is not expected to 
have an annual effect on the economy of $100 million or more or 
adversely affect in a material way the economy, a section of the 
economy, productivity, competition, jobs, the

[[Page 33665]]

environment, public health or safety, or State, local, or tribal 
governments or communities.
    The modifications to regulatory language in this final rule 
implement the Department of Labor rule which limited coverage of off-
site material and supply work from Davis-Bacon prevailing wage 
requirements as a result of appellate court rulings. In addition, this 
final rule implements the Department of Labor's limited amendment to 
the site of the work definition to address an issue not contemplated 
under then current regulatory language--those instances where 
significant portions of buildings or works may be constructed at 
secondary sites which are not in the vicinity of the project's final 
resting place. The Department of Labor believed that such instances 
will be rare, and that any increased costs which may arise on such 
projects would be offset by the savings resulting from the other 
changes that limit coverage.
    The DoD, GSA, and NASA also conclude that the rule is not a ``major 
rule'' requiring approval by the Congress under the Small Business 
Regulatory Enforcement Fairness Act of 1996 (5 U.S.C. 801 et seq.). 
DoD, GSA, and NASA agree with the Department of Labor assessment that 
this rule will not likely result in (1) an annual effect on the economy 
of $100 million or more; (2) a major increase in costs or prices for 
consumers, individual industries, Federal, State or local government 
agencies, or geographic regions; or (3) significant adverse effects on 
competition, employment, investment, productivity, innovation, or on 
the ability of U.S.-based enterprises to compete with foreign-based 
enterprises in domestic or export markets.
    For purposes of the Unfunded Mandates Reform Act of 1995, this rule 
does not include any Federal mandate that may result in excess of $100 
million in expenditures by state, local and tribal governments in the 
aggregate, or by the private sector. Furthermore, the requirements of 
the Unfunded Mandates Reform Act, 2 U.S.C. 1532, do not apply here 
because the rule does not include a Federal mandate. The term Federal 
mandate is defined to include either a Federal intergovernmental 
mandate or a Federal private sector mandate (2 U.S.C. 658(6)). Except 
in limited circumstances not applicable here, those terms do not 
include an enforceable duty which is a duty arising from participation 
in a voluntary program (2 U.S.C. 658(7)(A)). A decision by a contractor 
to bid on Federal and Federally assisted construction contracts is 
purely voluntary in nature, and the contractor's duty to meet Davis-
Bacon Act requirements arises from participation in a voluntary Federal 
program.

D. Executive Order 13132 (Federalism)

    DoD, GSA, and NASA have reviewed this rule in accordance with 
Executive Order 13132 regarding federalism, and have determined that it 
does not have federalism implications. The rule does not have 
substantial direct effects on the states, on the relationship between 
the national government and the states, or on the distribution of power 
and responsibilities among the various levels of government.

E. Paperwork Reduction Act

    The Paperwork Reduction Act does not apply because the changes to 
the FAR do not impose information collection requirements that require 
the approval of the Office of Management and Budget under 44 U.S.C. 
3501, et seq.

List of Subjects in 48 CFR Parts 22, 52, and 53

    Government procurement.

    Dated: May 27, 2005.
Julia B. Wise,
Director, Contract Policy Division.

0
Therefore, DoD, GSA, and NASA amend 48 CFR parts 22, 52, and 53 as set 
forth below:
0
1. The authority citation for 48 CFR parts 22, 52, and 53 is revised to 
read as follows:

    Authority: 40 U.S.C. 121(c); 10 U.S.C. chapter 137; and 42 
U.S.C. 2473(c).

PART 22--APPLICATION OF LABOR LAWS TO GOVERNMENT ACQUISITIONS

0
2. Amend section 22.401 by--
0
a. Adding, in alphabetical order, the definitions ``Apprentice'' and 
``Trainee;''
0
b. Removing from the first sentence of the definition ``Building or 
work'' the word ``generally;'' and
0
c. Revising the definitions ``Construction, alteration, or repair'', 
``Laborers or mechanics'' and ``Site of the work.''
0
The added and revised text reads as follows:


22.401  Definitions.

* * * * *
    Apprentice means a person--
    (1) Employed and individually registered in a bona fide 
apprenticeship program registered with the U.S. Department of Labor, 
Employment and Training Administration, Office of Apprenticeship 
Training, Employer, and Labor Services (OATELS), or with a State 
Apprenticeship Agency recognized by OATELS; or
    (2) Who is in the first 90 days of probationary employment as an 
apprentice in an apprenticeship program, and is not individually 
registered in the program, but who has been certified by the OATELS or 
a State Apprenticeship Agency (where appropriate) to be eligible for 
probationary employment as an apprentice.
* * * * *
    Construction, alteration, or repair means all types of work done by 
laborers and mechanics employed by the construction contractor or 
construction subcontractor on a particular building or work at the site 
thereof, including without limitations--
    (1) Altering, remodeling, installation (if appropriate) on the site 
of the work of items fabricated off-site;
    (2) Painting and decorating;
    (3) Manufacturing or furnishing of materials, articles, supplies, 
or equipment on the site of the building or work;
    (4) Transportation of materials and supplies between the site of 
the work within the meaning of paragraphs (1)(i) and (ii) of the ``site 
of the work'' definition of this section, and a facility which is 
dedicated to the construction of the building or work and is deemed 
part of the site of the work within the meaning of paragraph (2) of the 
``site of work'' definition of this section; and
    (5) Transportation of portions of the building or work between a 
secondary site where a significant portion of the building or work is 
constructed, which is part of the ``site of the work'' definition in 
paragraph (1)(ii) of this section, and the physical place or places 
where the building or work will remain (paragraph (1)(i) in the ``site 
of the work'' definition of this section).
    Laborers or mechanics.--(1) Means--
    (i) Workers, utilized by a contractor or subcontractor at any tier, 
whose duties are manual or physical in nature (including those workers 
who use tools or who are performing the work of a trade), as 
distinguished from mental or managerial;
    (ii) Apprentices, trainees, helpers, and, in the case of contracts 
subject to the Contract Work Hours and Safety Standards Act, watchmen 
and guards;
    (iii) Working foremen who devote more than 20 percent of their time 
during a workweek performing duties of a laborer or mechanic, and who 
do not meet the criteria of 29 CFR part 541, for the time so spent; and
    (iv) Every person performing the duties of a laborer or mechanic,

[[Page 33666]]

regardless of any contractual relationship alleged to exist between the 
contractor and those individuals; and
    (2) Does not include workers whose duties are primarily executive, 
supervisory (except as provided in paragraph (1)(iii) of this 
definition), administrative, or clerical, rather than manual. Persons 
employed in a bona fide executive, administrative, or professional 
capacity as defined in 29 CFR part 541 are not deemed to be laborers or 
mechanics.
* * * * *
    Site of the work.--(1) Means--
    (i) The primary site of the work. The physical place or places 
where the construction called for in the contract will remain when work 
on it is completed; and
    (ii) The secondary site of the work, if any. Any other site where a 
significant portion of the building or work is constructed, provided 
that such site is--
    (A) Located in the United States; and
    (B) Established specifically for the performance of the contract or 
project;
    (2) Except as provided in paragraph (3) of this definition, 
includes fabrication plants, mobile factories, batch plants, borrow 
pits, job headquarters, tool yards, etc., provided--
    (i) They are dedicated exclusively, or nearly so, to performance of 
the contract or project; and
    (ii) They are adjacent or virtually adjacent to the ``primary site 
of the work'' as defined in paragraphs (1)(i) of ``the secondary site 
of the work'' as defined in paragraph (1)(ii) of this definition;
    (3) Does not include permanent home offices, branch plant 
establishments, fabrication plants, or tool yards of a contractor or 
subcontractor whose locations and continuance in operation are 
determined wholly without regard to a particular Federal contract or 
project. In addition, fabrication plants, batch plants, borrow pits, 
job headquarters, yards, etc., of a commercial or material supplier 
which are established by a supplier of materials for the project before 
opening of bids and not on the project site, are not included in the 
``site of the work.'' Such permanent, previously established facilities 
are not a part of the ``site of the work'', even if the operations for 
a period of time may be dedicated exclusively, or nearly so, to the 
performance of a contract.
    Trainee means a person registered and receiving on-the-job training 
in a construction occupation under a program which has been approved in 
advance by the U.S. Department of Labor, Employment and Training 
Administration, Office of Apprenticeship Training, Employer, and Labor 
Services (OATELS), as meeting its standards for on-the-job training 
programs and which has been so certified by that Administration.
* * * * *
0
3. Amend section 22.404-3 by revising paragraph (c) to read as follows:


22.404-3  Procedures for requesting wage determinations.

* * * * *
    (c) Time for submission of requests. (1) The time required by the 
Department of Labor for processing requests for project wage 
determinations varies according to the facts and circumstances in each 
case. An agency should expect the processing to take at least 30 days. 
Accordingly, agencies should submit requests for project wage 
determinations for the primary site of the work to the Department of 
Labor at least 45 days (60 days if possible) before issuing the 
solicitation or exercising an option to extend the term of a contract.
    (2) Agencies should promptly submit to the Department of Labor an 
offeror's request for a project wage determination for a secondary site 
of the work.
* * * * *


22.404-4  [Amended]

0
4. Amend section 22.404-4 by revising the section heading as set forth 
below; and amending paragraphs (a), (b), and (c) by adding ``for the 
primary site of the work'' after ``determination'' each time it 
appears.


22.404-4  Solicitations issued without wage determinations for the 
primary site of the work.

* * * * *
0
5. Amend section 22.404-5 by--
0
a. Revising the first sentence of paragraphs (b)(1), (b)(2) 
introductory text, and (b)(2)(i);
0
b. Revising paragraph (b)(2)(ii);
0
c. Revising the first sentence of paragraphs (c)(2) and (c)(3); and
0
d. Revising paragraph (c)(4).
0
The revised text reads as follows:


22.404-5  Expiration of project wage determinations.

* * * * *
    (b) * * *
    (1) If a project wage determination for the primary site of the 
work expires before bid opening, or if it appears before bid opening 
that a project wage determination may expire before award, the 
contracting officer shall request a new determination early enough to 
ensure its receipt before bid opening. * * *
    (2) If a project wage determination for the primary site of the 
work expires after bid opening but before award, the contracting 
officer shall request an extension of the project wage determination 
expiration date from the Administrator, Wage and Hour Division. * * *
    (i) If the new determination for the primary site of the work 
changes any wage rates for classifications to be used in the contract, 
the contracting officer may cancel the solicitation only in accordance 
with 14.404-1. * * *
    (ii) If the new determination for the primary site of the work does 
not change any wage rates, the contracting officer shall award the 
contract and modify it to include the number and date of the new 
determination. (See 43.103(b)(1).)
    (c) * * *
    (2) The contracting officer need not delay opening and reviewing 
proposals or discussing them with the offerors while a new 
determination for the primary site of the work is being obtained. * * *
    (3) If the new determination for the primary site of the work 
changes any wage rates, the contracting officer shall amend the 
solicitation to incorporate the new determination, and furnish the wage 
rate information to all prospective offerors that were sent a 
solicitation if the closing date for receipt of proposals has not yet 
occurred, or to all offerors that submitted proposals if the closing 
date has passed. * * *
    (4) If the new determination for the primary site of the work does 
not change any wage rates, the contracting officer shall amend the 
solicitation to include the number and date of the new determination 
and award the contract.
0
6. Amend section 22.404-6 by revising the second sentence of paragraph 
(a)(2), the first sentence of paragraph (a)(3), the first sentence of 
paragraph (b)(3), and paragraph (b)(4) to read as follows:


22.404-6  Modifications of wage determinations.

    (a) * * *
    (2) * * * The need to include a modification of a project wage 
determination for the primary site of the work in a solicitation is 
determined by the time of receipt of the modification by the 
contracting agency. * * *
    (3) The need for inclusion of the modification of a general wage 
determination for the primary site of the work in a solicitation is 
determined by the publication date of the notice in the Federal 
Register, or by the time of receipt of the modification (annotated with 
the date and time immediately upon receipt) by the contracting agency, 
whichever occurs first. * * *
    (b) * * *

[[Page 33667]]

    (3) If an effective modification of the wage determination for the 
primary site of the work is received by the contracting officer before 
bid opening, the contracting officer shall postpone the bid opening, if 
necessary, to allow a reasonable time to amend the solicitation to 
incorporate the modification and permit bidders to amend their bids. * 
* *
    (4) If an effective modification of the wage determination for the 
primary site of the work is received by the contracting officer after 
bid opening, but before award, the contracting officer shall follow the 
procedures in 22.404-5(b)(2)(i) or (ii).
* * * * *
0
7. Amend section 22.404-8 by revising the introductory text of 
paragraph (a) and paragraph (a)(2); and in paragraphs (b)(1) 
introductory text, (b)(2), and (c) by adding ``of an improper wage 
determination for the primary site of the work'' after 
``notification''.


22.404-8  Notification of improper wage determination before award.

    (a) The following written notifications by the Department of Labor 
shall be effective immediately without regard to 22.404-6 if received 
by the contracting officer prior to award:
* * * * *
    (2) A wage determination is withdrawn by the Administrative Review 
Board.
* * * * *


22.406-9  [Amended]

0
8. Amend section 22.406-9 by--
0
a. Removing from the heading of paragraph (c)(1) ``Secretary of the 
Treasury'' and adding ``Comptroller General'' in its place; and 
removing from the last sentence of paragraph (c)(1) ``Secretary of the 
Treasury'' and adding ``Comptroller General (Claims Section)'' in its 
place; and
0
b. Removing from paragraph (c)(3) ``Secretary of the Treasury'' and 
adding ``Comptroller General'' in its place.
0
9. Amend section 22.407 by--
0
a. Revising the heading as set forth below;
0
b. Removing from the introductory text of paragraph (a) ``The 
contracting officer shall insert'' and adding ``Insert'' in its place;
0
c. Removing from paragraphs (a)(1) through (a)(10) ``The clause at'';
0
d. Removing from paragraph (b) ``The contracting officer shall insert'' 
and adding ``Insert'' in its place;
0
e. Removing from the second sentence of paragraph (c) ``the contracting 
officer shall'';
0
f. Removing from paragraph (d) ``The contracting officer shall insert'' 
and adding ``Insert'' in its place; and
0
g. Adding paragraph (h) to read as follows:


22.407  Solicitation provision and contract clauses.

* * * * *
    (h) Insert the provision at 52.222-5, Davis Bacon Act--Secondary 
Site of the Work, in solicitations in excess of $2,000 for construction 
within the United States.

PART 52--SOLICIATION PROVISIONS AND CONTRACT CLAUSES

0
10. Amend section 52.212-5 by revising the date of the clause; and in 
paragraph (c)(1) and (e)(1)(vi) by removing ``(May 1989)'' and adding 
``(JUL 2005)'' in its place. The revised text reads as follows:


52.212-5  Contract Terms and Conditions Required to Implement Statutes 
or Executive Orders--Commercial Items.

* * * * *

CONTRACT TERMS AND CONDITIONS REQUIRED TO IMPLEMENT STATUTES OR 
EXECUTIVE ORDERS--COMMERCIAL ITEMS (JUL 2005)

* * * * *
0
11. Amend section 52.213-4 by revising the date of the clause; and in 
paragraph (b)(1)(vi) by removing ``(May 1989)'' and adding ``(JUL 
2005)'' in its place. The revised text reads as follows:


52.213-4  Terms and Conditions--Simplified Acquisitions (Other Than 
Commercial Items).

* * * * *

TERMS AND CONDITIONS--SIMPLIFIED ACQUISITIONS OTHER THAN COMMERCIAL 
ITEMS (JUL 2005)

* * * * *
0
12. Amend section 52.222-4 by revising the date of the clause and 
paragraph (e) to read as follows:


52.222-4  Contract Work Hours and Safety Standards Act--Overtime 
Compensation.

* * * * *

CONTRACT WORK HOURS AND SAFETY STANDARDS ACT--OVERTIME COMPENSATION 
(JUL 2005)

* * * * *
    (e) Subcontracts. The Contractor shall insert the provisions set 
forth in paragraphs (a) through (d) of this clause in subcontracts 
that may require or involve the employment of laborers and mechanics 
and require subcontractors to include these provisions in any such 
lower tier subcontracts. The Contractor shall be responsible for 
compliance by any subcontractor or lower-tier subcontractor with the 
provisions set forth in paragraphs (a) through (d) of this clause.

(End of clause)

0
13. Add text to section 52.222-5 to read as follows:


52.222-5  Davis-Bacon Act--Secondary Site of the Work.

    As prescribed in 22.407(h), insert the following provision:

DAVIS-BACON ACT--SECONDARY SITE OF THE WORK (JUL 2005)

    (a)(1) The offeror shall notify the Government if the offeror 
intends to perform work at any secondary site of the work, as 
defined in paragraph (a)(1)(ii) of the FAR clause at 52.222-6, 
Davis-Bacon Act, of this solicitation.
    (2) If the offeror is unsure if a planned work site satisfies 
the criteria for a secondary site of the work, the offeror shall 
request a determination from the Contracting Officer.
    (b)(1) If the wage determination provided by the Government for 
work at the primary site of the work is not applicable to the 
secondary site of the work, the offeror shall request a wage 
determination from the Contracting Officer.
    (2) The due date for receipt of offers will not be extended as a 
result of an offeror's request for a wage determination for a 
secondary site of the work.

(End of provision)

0
14. Amend section 52.222-6 by--
0
a. Revising the date of the clause;
0
b. Redesignating paragraphs (a) through (d) as paragraphs (b) through 
(e);
0
c. Adding a new paragraph (a);
0
d. Revising the newly designated paragraph (b); and
0
e. Removing from the newly designated paragraph (c)(4) ``(b)(2)'' and 
``(b)(3)'' and adding ``(c)(2)'' and ``(c)(3) ''in their places, 
respectively.
0
The revised and added text reads as follows:


52.222-6  Davis-Bacon Act.

* * * * *

DAVIS-BACON ACT (JUL 2005)

    (a) Definition.--Site of the work--(1) Means--
    (i) The primary site of the work. The physical place or places 
where the construction called for in the contract will remain when 
work on it is completed; and
    (ii) The secondary site of the work, if any. Any other site 
where a significant portion of the building or work is constructed, 
provided that such site is--
    (A) Located in the United States; and
    (B) Established specifically for the performance of the contract 
or project;
    (2) Except as provided in paragraph (3) of this definition, 
includes any fabrication plants, mobile factories, batch plants, 
borrow pits, job headquarters, tool yards, etc., provided--
    (i) They are dedicated exclusively, or nearly so, to performance 
of the contract or project; and
    (ii) They are adjacent or virtually adjacent to the ``primary 
site of the work'' as defined in paragraph (a)(1)(i), or the 
``secondary site

[[Page 33668]]

of the work'' as defined in paragraph (a)(1)(ii) of this definition;
    (3) Does not include permanent home offices, branch plant 
establishments, fabrication plants, or tool yards of a Contractor or 
subcontractor whose locations and continuance in operation are 
determined wholly without regard to a particular Federal contract or 
project. In addition, fabrication plants, batch plants, borrow pits, 
job headquarters, yards, etc., of a commercial or material supplier 
which are established by a supplier of materials for the project 
before opening of bids and not on the Project site, are not included 
in the ``site of the work.'' Such permanent, previously established 
facilities are not a part of the ``site of the work'' even if the 
operations for a period of time may be dedicated exclusively or 
nearly so, to the performance of a contract.
    (b)(1) All laborers and mechanics employed or working upon the 
site of the work will be paid unconditionally and not less often 
than once a week, and without subsequent deduction or rebate on any 
account (except such payroll deductions as are permitted by 
regulations issued by the Secretary of Labor under the Copeland Act 
(29 CFR part 3)), the full amount of wages and bona fide fringe 
benefits (or cash equivalents thereof) due at time of payment 
computed at rates not less than those contained in the wage 
determination of the Secretary of Labor which is attached hereto and 
made a part hereof, or as may be incorporated for a secondary site 
of the work, regardless of any contractual relationship which may be 
alleged to exist between the Contractor and such laborers and 
mechanics. Any wage determination incorporated for a secondary site 
of the work shall be effective from the first day on which work 
under the contract was performed at that site and shall be 
incorporated without any adjustment in contract price or estimated 
cost. Laborers employed by the construction Contractor or 
construction subcontractor that are transporting portions of the 
building or work between the secondary site of the work and the 
primary site of the work shall be paid in accordance with the wage 
determination applicable to the primary site of the work.
    (2) Contributions made or costs reasonably anticipated for bona 
fide fringe benefits under section 1(b)(2) of the Davis-Bacon Act on 
behalf of laborers or mechanics are considered wages paid to such 
laborers or mechanics, subject to the provisions of paragraph (e) of 
this clause; also, regular contributions made or costs incurred for 
more than a weekly period (but not less often than quarterly) under 
plans, funds, or programs which cover the particular weekly period, 
are deemed to be constructively made or incurred during such period.
    (3) Such laborers and mechanics shall be paid not less than the 
appropriate wage rate and fringe benefits in the wage determination 
for the classification of work actually performed, without regard to 
skill, except as provided in the clause entitled Apprentices and 
Trainees. Laborers or mechanics performing work in more than one 
classification may be compensated at the rate specified for each 
classification for the time actually worked therein; provided that 
the employer's payroll records accurately set forth the time spent 
in each classification in which work is performed.
    (4) The wage determination (including any additional 
classifications and wage rates conformed under paragraph (c) of this 
clause) and the Davis-Bacon poster (WH-1321) shall be posted at all 
times by the Contractor and its subcontractors at the primary site 
of the work and the secondary site of the work, if any, in a 
prominent and accessible place where it can be easily seen by the 
workers.
* * * * *
0
15. Amend section 52.222-9 by revising the date of the clause and 
paragraphs (a) and (b) to read as follows:


52.222-9  Apprentices and Trainees.

* * * * *

APPRENTICES AND TRAINEES (JUL 2005)

    (a) Apprentices. (1) An apprentice will be permitted to work at 
less than the predetermined rate for the work performed when 
employed--
    (i) Pursuant to and individually registered in a bona fide 
apprenticeship program registered with the U.S. Department of Labor, 
Employment and Training Administration, Office of Apprenticeship 
Training, Employer, and Labor Services (OATELS) or with a State 
Apprenticeship Agency recognized by the OATELS; or
    (ii) In the first 90 days of probationary employment as an 
apprentice in such an apprenticeship program, even though not 
individually registered in the program, if certified by the OATELS 
or a State Apprenticeship Agency (where appropriate) to be eligible 
for probationary employment as an apprentice.
    (2) The allowable ratio of apprentices to journeymen on the job 
site in any craft classification shall not be greater than the ratio 
permitted to the Contractor as to the entire work force under the 
registered program.
    (3) Any worker listed on a payroll at an apprentice wage rate, 
who is not registered or otherwise employed as stated in paragraph 
(a)(1) of this clause, shall be paid not less than the applicable 
wage determination for the classification of work actually 
performed. In addition, any apprentice performing work on the job 
site in excess of the ratio permitted under the registered program 
shall be paid not less than the applicable wage rate on the wage 
determination for the work actually performed.
    (4) Where a Contractor is performing construction on a project 
in a locality other than that in which its program is registered, 
the ratios and wage rates (expressed in percentages of the 
journeyman's hourly rate) specified in the Contractor's or 
subcontractor's registered program shall be observed. Every 
apprentice must be paid at not less than the rate specified in the 
registered program for the apprentice's level of progress, expressed 
as a percentage of the journeyman hourly rate specified in the 
applicable wage determination.
    (5) Apprentices shall be paid fringe benefits in accordance with 
the provisions of the apprenticeship program. If the apprenticeship 
program does not specify fringe benefits, apprentices must be paid 
the full amount of fringe benefits listed on the wage determination 
for the applicable classification. If the Administrator determines 
that a different practice prevails for the applicable apprentice 
classification, fringes shall be paid in accordance with that 
determination.
    (6) In the event OATELS, or a State Apprenticeship Agency 
recognized by OATELS, withdraws approval of an apprenticeship 
program, the Contractor will no longer be permitted to utilize 
apprentices at less than the applicable predetermined rate for the 
work performed until an acceptable program is approved.
    (b) Trainees. (1) Except as provided in 29 CFR 5.16, trainees 
will not be permitted to work at less than the predetermined rate 
for the work performed unless they are employed pursuant to and 
individually registered in a program which has received prior 
approval, evidenced by formal certification by the U.S. Department 
of Labor, Employment and Training Administration, Office of 
Apprenticeship Training, Employer, and Labor Services (OATELS). The 
ratio of trainees to journeymen on the job site shall not be greater 
than permitted under the plan approved by OATELS.
    (2) Every trainee must be paid at not less than the rate 
specified in the approved program for the trainee's level of 
progress, expressed as a percentage of the journeyman hourly rate 
specified in the applicable wage determination. Trainees shall be 
paid fringe benefits in accordance with the provisions of the 
trainee program. If the trainee program does not mention fringe 
benefits, trainees shall be paid the full amount of fringe benefits 
listed in the wage determination unless the Administrator of the 
Wage and Hour Division determines that there is an apprenticeship 
program associated with the corresponding journeyman wage rate in 
the wage determination which provides for less than full fringe 
benefits for apprentices. Any employee listed on the payroll at a 
trainee rate who is not registered and participating in a training 
plan approved by the OATELS shall be paid not less than the 
applicable wage rate in the wage determination for the 
classification of work actually performed. In addition, any trainee 
performing work on the job site in excess of the ratio permitted 
under the registered program shall be paid not less than the 
applicable wage rate in the wage determination for the work actually 
performed.
    (3) In the event OATELS withdraws approval of a training 
program, the Contractor will no longer be permitted to utilize 
trainees at less than the applicable predetermined rate for the work 
performed until an acceptable program is approved.
* * * * *
0
16. Revise the clause in section 52.222-11 to read as follows:


52.222-11  Subcontracts (Labor Standards).

* * * * *

SUBCONTRACTS (LABOR STANDARDS) (JUL 2005)

    (a) Definition. Construction, alteration or repair, as used in 
this clause, means all types

[[Page 33669]]

of work done by laborers and mechanics employed by the construction 
Contractor or construction subcontractor on a particular building or 
work at the site thereof, including without limitation--
    (1) Altering, remodeling, installation (if appropriate) on the 
site of the work of items fabricated off-site;
    (2) Painting and decorating;
    (3) Manufacturing or furnishing of materials, articles, 
supplies, or equipment on the site of the building or work;
    (4) Transportation of materials and supplies between the site of 
the work within the meaning of paragraphs (a)(1)(i) and (ii) of the 
``site of the work'' as defined in the FAR clause at 52.222-6, 
Davis-Bacon Act of this contract, and a facility which is dedicated 
to the construction of the building or work and is deemed part of 
the site of the work within the meaning of paragraph (2) of the 
``site of work'' definition; and
    (5) Transportation of portions of the building or work between a 
secondary site where a significant portion of the building or work 
is constructed, which is part of the ``site of the work'' definition 
in paragraph (a)(1)(ii) of the FAR clause at 52.222-6, Davis-Bacon 
Act, and the physical place or places where the building or work 
will remain (paragraph (a)(1)(i) of the FAR clause at 52.222-6, in 
the ``site of the work'' definition).
    (b) The Contractor shall insert in any subcontracts for 
construction, alterations and repairs within the United States the 
clauses entitled--
    (1) Davis-Bacon Act;
    (2) Contract Work Hours and Safety Standards Act--Overtime 
Compensation (if the clause is included in this contract);
    (3) Apprentices and Trainees;
    (4) Payrolls and Basic Records;
    (5) Compliance with Copeland Act Requirements;
    (6) Withholding of Funds;
    (7) Subcontracts (Labor Standards);
    (8) Contract Termination--Debarment;
    (9) Disputes Concerning Labor Standards;
    (10) Compliance with Davis-Bacon and Related Act Regulations; 
and
    (11) Certification of Eligibility.
    (c) The prime Contractor shall be responsible for compliance by 
any subcontractor or lower tier subcontractor performing 
construction within the United States with all the contract clauses 
cited in paragraph (b).
    (d)(1) Within 14 days after award of the contract, the 
Contractor shall deliver to the Contracting Officer a completed 
Standard Form (SF) 1413, Statement and Acknowledgment, for each 
subcontract for construction within the United States, including the 
subcontractor's signed and dated acknowledgment that the clauses set 
forth in paragraph (b) of this clause have been included in the 
subcontract.
    (2) Within 14 days after the award of any subsequently awarded 
subcontract the Contractor shall deliver to the Contracting Officer 
an updated completed SF 1413 for such additional subcontract.
    (e) The Contractor shall insert the substance of this clause, 
including this paragraph (e) in all subcontracts for construction 
within the United States.

(End of clause)


52.222-41  [Amended]

0
17. Amend section 52.222-41 by revising the date of the clause to read 
``(JUL 2005)''; and in the first sentence of paragraph (r) of the 
clause by removing ``Bureau of Apprenticeship and Training, Employment 
and Training Administration'' and adding ``Office of Apprenticeship 
Training, Employer, and Labor Services (OATELS)'' in its place.

PART 53--FORMS


53.222  [Amended]

0
18. Amend section 53.222 in paragraph (e) by removing ``(Rev. 6/89)'' 
and adding ``(Rev. 7/2005)'' in its place; and removing the last 
sentence.
0
19. Amend section 53.301-1413 by revising the form to read as follows:


53.301-1413  Statement and Acknowledgement.

[[Page 33670]]

[GRAPHIC] [TIFF OMITTED] TR08JN05.000


[[Page 33671]]


[FR Doc. 05-11186 Filed 6-7-05; 8:45 am]
BILLING CODE 6820-EP-S