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Labor standards and equal employment opportunity requirements for federally assisted construction must be specified in the information provided to potential bidders/offerors on contracts for construction services under NIH construction and modernization grants and major A&R projects and must be included in the resulting contract documents (see 45 CFR 75, Appendix II to Part 75-Contract Provisions for Non-Federal Entity Contracts Under Federal Awards). NIH construction and modernization grants and major A&R projects (and contracts under them) are not subject to the requirements of the Davis-Bacon Act, unless the authorizing statute for the program/award specifically requires compliance.
Contracts (and subcontracts) for construction (including modernization or major A&R) are subject to the requirements of EO 11246 (September 24, 1965), as amended and implemented in 41 CFR 60-1 by OFCCP, DoL. The recipient is required to include the "Equal Opportunity Clause" at 41 CFR 60-1.4(b) in any contract for construction services under the grant. The contractor must be directed to include this clause in any applicable subcontracts.
In addition, recipients and contractors providing construction services under NIH grants are required to comply with the solicitation and contract requirements for affirmative action specified in 41 CFR 60-4 for contracts in specified geographical areas that will exceed $10,000. These requirements are specified in the "Notice of Requirement for Affirmative Action to Ensure Equal Employment Opportunity" and the "Standard Federal Equal Employment Opportunity Construction Contract Specifications" subsections of 41 CFR 60-4.
The OFCCP regulations also require that the recipient notify the applicable OFCCP regional, area, or field office when it expects to award a contract for construction services that will exceed $10,000.
Further information about these requirements and the full text of these regulations are available at http://www.dol.gov/ofccp/.
Pursuant to 41 CFR 60-1.8, for any contract for construction services that will exceed $10,000, the recipient must require that each prospective contractor:
Contractors and subcontractors providing construction services under NIH construction or modernization grants or major A&R projects with contracts or subcontracts exceeding $100,000 are subject to the requirements of the Contract Work Hours and Safety Standards Act, 40 U.S.C. 3701, et seq., concerning the payment of overtime and the maintenance of healthful and safe working conditions.
Wages paid any laborer or mechanic employed by the contractor or subcontractor must be computed on the basis of a standard workweek of 40 hours. For all work in excess of the standard workweek, mechanics and laborers shall be compensated at a rate not less than one-and-a-half times the basic rate of pay. If this requirement is violated, the contractor or subcontractor is liable to the employee for the unpaid wages and may be liable to the Federal government for liquidated damages. NIH or the recipient may withhold otherwise payable funds to satisfy any such liability. The statute also specifies penalties for intentional violation of these requirements.
Further, pursuant to standards issued by the Secretary of Labor, no contractor or subcontractor under an NIH grant shall require any laborer or mechanic employed in the performance of the contract to work in surroundings or under working conditions that are unsanitary, hazardous, or dangerous to an individual's health or safety. Violation of these requirements may be cause for debarment from future Federal contracts or financial assistance.
During or after the period of performance of a contract for construction services under an NIH grant, if it is discovered that an employee is entitled to wages but cannot be located for the purposes of payment (or for some reason refuses to accept payment), the recipient may eventually have to repay the Federal government. Therefore, NIH suggests that the contractor be required to turn over any unclaimed wages to the recipient.
The recipient should notify the GMO that an escrow account has been established in the affected employee's name and should maintain the account for 2 years (or longer if required by State or local law) following the completion of the contract. Upon the expiration of this period, any amounts still unclaimed will be disbursed by refunding to NIH either the entire amount, if the construction, modernization, or major A&R project was 100 percent funded by NIH, or an amount representing the percentage of NIH participation in the project. If the project was funded by more than one NIH or HHS program at differing rates, the refund should be based on an average percentage calculated by weighting each program's rate of participation by the dollar amount of that program's contribution.
If the contractor has made a reasonable effort to locate the employee by having mail forwarded and contacting the employee's union, the recipient need not repeat such attempts. If there is reason to believe that the contractor's efforts to locate employees that are due wages were not thorough, the recipient should attempt to locate the employees. Doing so will reduce the likelihood of future claims against the recipient.
If any wages held in escrow are paid to an employee or an employee's legal representative while the account is maintained, a complete report must be made to the GMO when the account is closed.