Federal Contracting (Procurement)

SCA Wage Determination

Description :

The current SCA wage determinations for many metropolitan areas are significantly lower pay rates than the market and collective bargaining rates.  As competition becomes fierce and the labor pool diminishes, specifically, specialized trades, contractors tend to bid at the minimum SCA in order to boot the incumbent.  IGCE models are archaic and do not account for the significant inflation.  Best value contracts are being determined on low price, rather than over all best value.  It has been nearly impossible to convince agencies necessary wage increases are absolutely necessary when key personnel labor rates are far below the private market to keep qualified or recruit qualified personnel.  To ignore this any longer is irresponsible of agencies.  Contractors are winning bids by under valuing their services and it is undeniable the competitors are submitting price proposals that indicate a net loss.  If only one employer responds to the BLS annual request to provide wages for a county, it's inconceivable the wage determination would be based, in part, on the single employer response.   There is a huge disparity in the front range of Colorado between private market wages, union wages and significantly low SCA wages. Service contracts tend to be 70% direct labor costs.  Small businesses should not be forced to low bid, under price, or unionize to sustain win procurements that require highly specialized skills.  We will see more "straw companies" as a result.  It is not competition when businesses are forced to under value their services or unionize to prevail on paying employees market labor rates.




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Idea No. 51