[Federal Register Volume 80, Number 19 (Thursday, January 29, 2015)]
[Rules and Regulations]
[Pages 4992-4993]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2015-01525]


-----------------------------------------------------------------------

DEPARTMENT OF DEFENSE

GENERAL SERVICES ADMINISTRATION

NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

48 CFR Parts 37 and 52

[FAC 2005-80; FAR Case 2014-008; Item II; Docket No. 2014-0008; 
Sequence No. 1]
RIN 9000-AM84


Federal Acquisition Regulation; Management and Oversight of the 
Acquisition of Services

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

ACTION: Final rule.

-----------------------------------------------------------------------

SUMMARY: DoD, GSA, and NASA are issuing a final rule amending the 
Federal Acquisition Regulation (FAR) to implement a recommendation to 
strengthen guidance on service acquisitions on uncompensated overtime.

DATES: Effective: March 2, 2015.

FOR FURTHER INFORMATION CONTACT: Mr. Michael O. Jackson, Procurement 
Analyst, at 202-208-4949 for clarification of content. For information 
pertaining to status or publication schedules, contact the Regulatory 
Secretariat Division at 202-501-4755. Please cite FAC 2005-80, FAR Case 
2014-008.

SUPPLEMENTARY INFORMATION: 

I. Background

    Section 865 of the Ike Skelton National Defense Authorization Act 
(NDAA) for Fiscal Year (FY) 2011 (Pub. L. 111-383) directed the 
Secretary of Defense to submit, in consultation with the Office of 
Federal Procurement Policy (OFPP) and all other relevant Federal 
agencies, a review of the Federal Acquisition Regulation (FAR) and 
Defense Federal Acquisition Regulations Supplement (DFARS), to ensure 
that they have appropriate guidance for service acquisitions. As a 
result, the regulatory drafting teams for the FAR and DFARS reviewed 
current regulations related to services and considered the extent to 
which improvements might be needed.
    In November 2011, DoD issued a report entitled DoD Report to 
Congress on Federal Acquisition Regulation (FAR) and Defense Federal 
Acquisition Regulations Supplement (DFARS) Review Regarding Services 
Acquisition. This Report to Congress includes a series of 
recommendations on issues for strengthening existing guidance on 
services acquisition through addition, clarification, or expansion.

II. Analysis and Discussion

    This FAR case implements a recommendation to create a definition of 
uncompensated overtime. Accordingly, the existing definitions of 
``uncompensated overtime'' and ``uncompensated overtime rate'' at FAR 
52.237-10(a) have been incorporated at FAR 37.101, with the defined 
term ``uncompensated overtime rate'' changing to ``adjusted hourly rate 
(including uncompensated overtime).'' Additionally, the definition of 
the new term ``adjusted hourly rate (including uncompensated 
overtime)'' clarifies that the proposed hours per week include

[[Page 4993]]

uncompensated overtime hours over and above the standard 40-hour work 
week. The clause at FAR 52.237-10 is further amended to clarify the 
application of the adjusted hourly rate, and categorization of proposed 
hours subject to the adjusted hourly rate. Finally, a change is made at 
FAR 37.115-2 to reflect the change made in the clause at FAR 52.237-
10(b).

III. Publication of This Final Rule for Public Comment Is Not Required 
by Statute

    ``Publication of proposed regulations'', 41 U.S.C. 1707, is the 
statute which applies to the publication of the Federal Acquisition 
Regulation. Paragraph (a)(1) of the statute requires that a procurement 
policy, regulation, procedure or form (including an amendment or 
modification thereof) must be published for public comment if it 
relates to the expenditure of appropriated funds, and has either a 
significant effect beyond the internal operating procedures of the 
agency issuing the policy, regulation, procedure or form, or has a 
significant cost or administrative impact on contractors or offerors. 
This final rule is not required to be published for public comment, 
because it only clarifies policy that is already stated in the FAR. 
These proposed changes as described in section II of this preamble 
affect only the internal operating procedures of the Government.

IV. Executive Orders 12866 and 13563

    Executive Orders (E.O.s) 12866 and 13563 direct agencies to assess 
all costs and benefits of available regulatory alternatives and, if 
regulation is necessary, to select regulatory approaches that maximize 
net benefits (including potential economic, environmental, public 
health and safety effects, distributive impacts, and equity). E.O. 
13563 emphasizes the importance of quantifying both costs and benefits, 
of reducing costs, of harmonizing rules, and of promoting flexibility. 
This is not a significant regulatory action and, therefore, was not 
subject to review under Section 6(b) of E.O. 12866, Regulatory Planning 
and Review, dated September 30, 1993. This rule is not a major rule 
under 5 U.S.C. 804.

V. Regulatory Flexibility Act

    The Regulatory Flexibility Act does not apply to this rule because 
this final rule does not constitute a significant FAR revision within 
the meaning of FAR 1.501-1 and 41 U.S.C. 1707 does not require 
publication for public comment.

VI. Paperwork Reduction Act

    The rule does not contain any information collection requirements 
that require the approval of the Office of Management and Budget under 
the Paperwork Reduction Act (44 U.S.C. chapter 35).

List of Subjects in CFR Parts 37 and 52

    Government procurement.

    Dated: January 22, 2015.
William Clark,
Director, Office of Government-wide Acquisition Policy, Office of 
Acquisition Policy, Office of Government-wide Policy.
    Therefore, DoD, GSA, and NASA amend 48 CFR parts 37 and 52 as set 
forth below:

0
1. The authority citation for 48 CFR parts 37 and 52 continues to read 
as follows:

    Authority:  40 U.S.C. 121(c); 10 U.S.C. chapter 137; and 51 
U.S.C. 20113.

PART 37--SERVICE CONTRACTING

0
2. Amend section 37.101 by adding, in alphabetical order, the 
definitions ``Adjusted hourly rate (including uncompensated overtime)'' 
and ``Uncompensated overtime'' to read as follows:


37.101  Definitions.

* * * * *
    Adjusted hourly rate (including uncompensated overtime) is the rate 
that results from multiplying the hourly rate for a 40-hour work week 
by 40, and then dividing by the proposed hours per week which includes 
uncompensated overtime hours over and above the standard 40-hour work 
week. For example, 45 hours proposed on a 40-hour work week basis at 
$20 per hour would be converted to an uncompensated overtime rate of 
$17.78 per hour ($20.00 x 40/45 = $17.78).
* * * * *
    Uncompensated overtime means the hours worked without additional 
compensation in excess of an average of 40 hours per week by direct 
charge employees who are exempt from the Fair Labor Standards Act. 
Compensated personal absences such as holidays, vacations, and sick 
leave shall be included in the normal work week for purposes of 
computing uncompensated overtime hours.

0
3. Amend section 37.115-2 by adding paragraph (d) to read as follows:


37.115-2  General policy.

* * * * *
    (d) Whenever there is uncompensated overtime, the adjusted hourly 
rate (including uncompensated overtime) (see definition at 37.101), 
rather than the hourly rate, shall be applied to all proposed hours, 
whether regular or overtime hours.

PART 52--SOLICITATION PROVISIONS AND CONTRACT CLAUSES

0
4. Amend section 52.237-10 by--
0
a. Revising the date of the provision;
0
b. Removing from paragraph (a) the definition ``Uncompensated overtime 
rate'', and adding, in alphabetical order, the definition ``Adjusted 
hourly rate (including uncompensated overtime)''; and
0
c. Revising paragraph (b).
    The revisions and addition read as follows:


52.237-10  Identification of Uncompensated Overtime.

* * * * *

Identification of Uncompensated Overtime Mar 2015

    (a) * * *
    Adjusted hourly rate (including uncompensated overtime) is the 
rate that results from multiplying the hourly rate for a 40-hour 
work week by 40, and then dividing by the proposed hours per week 
which includes uncompensated overtime hours over and above the 
standard 40-hour work week. For example, 45 hours proposed on a 40-
hour work week basis at $20 per hour would be converted to an 
uncompensated overtime rate of $17.78 per hour ($20.00 x 40 divided 
by 45 = $17.78).
* * * * *
    (b)(1) Whenever there is uncompensated overtime, the adjusted 
hourly rate (including uncompensated overtime), rather than the 
hourly rate, shall be applied to all proposed hours, whether regular 
or overtime hours.
    (2) All proposed labor hours subject to the adjusted hourly rate 
(including uncompensated overtime) shall be identified as either 
regular or overtime hours, by labor categories, and described at the 
same level of detail. This is applicable to all proposals whether 
the labor hours are at the prime or subcontract level. This includes 
uncompensated overtime hours that are in indirect cost pools for 
personnel whose regular hours are normally charged direct.
* * * * *
[FR Doc. 2015-01525 Filed 1-28-15; 8:45 am]
BILLING CODE 6820-EP-P