83_FR_19232 83 FR 19148 - Federal Acquisition Regulation: Liquidated Damages Rate Adjustment

83 FR 19148 - Federal Acquisition Regulation: Liquidated Damages Rate Adjustment

DEPARTMENT OF DEFENSE
GENERAL SERVICES ADMINISTRATION
NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

Federal Register Volume 83, Issue 84 (May 1, 2018)

Page Range19148-19149
FR Document2018-09167

DoD, GSA, and NASA are issuing a final rule to amend the Federal Acquisition Regulation (FAR) to adjust for inflation the rate of liquidated damages assessed for violations of the overtime provisions of the Contract Work Hours and Safety Standards Act.

Federal Register, Volume 83 Issue 84 (Tuesday, May 1, 2018) 
[Federal Register Volume 83, Number 84 (Tuesday, May 1, 2018)]
[Rules and Regulations]
[Pages 19148-19149]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2018-09167]


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DEPARTMENT OF DEFENSE

GENERAL SERVICES ADMINISTRATION

NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

48 CFR Parts 22 and 52

[FAC 2005-98; FAR Case 2017-004; Item III; Docket No. 2017-0004, 
Sequence No. 1]
RIN 9000-AN37


Federal Acquisition Regulation: Liquidated Damages Rate 
Adjustment

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

ACTION: Final rule.

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SUMMARY: DoD, GSA, and NASA are issuing a final rule to amend the 
Federal Acquisition Regulation (FAR) to adjust for inflation the rate 
of liquidated damages assessed for violations of the overtime 
provisions of the Contract Work Hours and Safety Standards Act.

DATES: Effective: May 31, 2018.

FOR FURTHER INFORMATION CONTACT: Ms. Zenaida Delgado, Procurement 
Analyst, at 202-969-7207 for clarification of content. For information 
pertaining to status or publication schedules, contact the Regulatory 
Secretariat Division at 202-501-4755. Please cite FAC 2005-98, FAR Case 
2017-004.

SUPPLEMENTARY INFORMATION: 

I. Background

    DoD, GSA, and NASA are issuing a final rule amending the Federal 
Acquisition Regulation (FAR) to implement the Department of Labor (DOL) 
interim final rule published in the Federal Register at 81 FR 43430 on 
July 1, 2016, the final rule published in the Federal Register at 82 FR 
5373 on January 18, 2017, and subsequent adjustments for inflation 
pursuant to the Federal Civil Penalties Inflation Adjustment Act of 
1990, as amended by the Federal Civil Penalties Inflation Adjustment 
Act Improvements Act of 2015 (Inflation Adjustment Act) (section 701 of 
Pub. L. 114-74) (28 U.S.C. 2461 Note). The Inflation Adjustment Act 
requires agencies to adjust the levels of civil monetary penalties for 
inflation no later than January 15 of each year.

II. Discussion and Analysis

    The DOL rule set the new rate of liquidated damages at $25 per 
individual for each calendar day on which a laborer or mechanic 
employed under a contract or subcontract subject to the overtime 
provisions of the Contract Work Hours and Safety Standards Act was 
required or permitted to work in excess of the standard workweek of 40 
hours without payment of the required overtime wages. Since this rate 
will continue to change annually for inflation, FAR 22.302, Liquidated 
Damages and Overtime Pay, and paragraph (b) of FAR clause 52.222-4, 
Contract Work Hours and Safety Standards--Overtime Compensation, are 
revised to reference the current liquidated damages rate, as specified 
in the DOL regulations at 29 CFR 5.5(b)(2). With this reference being 
incorporated in lieu of the dollar amount, an annual FAR change will 
not be necessary.

III. Applicability to Contracts at or Below the Simplified Acquisition 
Threshold and for Commercial Items, Including Commercially Available 
Off-the-Shelf Items

    This rule amends the FAR to refer to the rate of liquidated damages 
for violations of the overtime provisions of the Contract Work Hours 
and Safety Standards Act, in accordance with DOL regulations, rather 
than provide a specific dollar rate, because this rate is adjusted 
annually. The revisions do not add any new burdens or impact 
applicability of clauses and provisions at or below the simplified 
acquisition threshold, or to commercial items.

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

    The statute that applies to the publication of the Federal 
Acquisition Regulation (FAR) is the Office of Federal Procurement 
Policy statute (codified at title 41 of the United States Code). 
Specifically, 41 U.S.C. 1707(a)(1) 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 this final FAR 
rule merely implements the requirements of the DOL rule that was 
published for comment--interim final rule published in the Federal 
Register at 81 FR 43430 on July 1, 2016, and the final rule published 
in the Federal Register at 82 FR 5373 on January 18, 2017. The new

[[Page 19149]]

DOL rate is required by statute (the Inflation Adjustment Act); GSA, 
DoD, and NASA have no authority to change the rate.

V. 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.

VI. Executive Order 13771

    This rule is not subject to E.O. 13771, because this rule is not a 
significant regulatory action under E.O. 12866.

VII. Regulatory Flexibility Act

    Because a notice of proposed rulemaking and an opportunity for 
public comment are not required to be given for this rule under 41 
U.S.C. 1707(a)(1) (see section IV. of this preamble), the analytical 
requirements of the Regulatory Flexibility Act (5 U.S.C. 601 et seq.) 
are not applicable. Accordingly, no regulatory flexibility analysis is 
required and none has been prepared.

VIII. 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 48 CFR Parts 22 and 52

    Government procurement.

    Dated: April 25, 2018.
William F. 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 22 and 52 as set 
forth below:

0
1. The authority citation for parts 22 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 22--APPLICATION OF LABOR LAWS TO GOVERNMENT ACQUISITIONS

0
2. Amend section 22.302 by revising paragraph (a) to read as follows:


22.302   Liquidated damages and overtime pay.

    (a) When an overtime computation discloses underpayments, the 
responsible contractor or subcontractor must pay the affected employee 
any unpaid wages and pay liquidated damages to the Government. The 
contracting officer must assess liquidated damages at the rate 
specified at 29 CFR 5.5(b)(2) per affected employee for each calendar 
day on which the employer required or permitted the employee to work in 
excess of the standard workweek of 40 hours without paying overtime 
wages required by the statute. In accordance with the Federal Civil 
Penalties Inflation Adjustment Act of 1990 (28 U.S.C. 2461 Note), the 
Department of Labor adjusts this civil monetary penalty for inflation 
no later than January 15 each year.
* * * * *

PART 52--SOLICITATION PROVISIONS AND CONTRACT CLAUSES

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


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

* * * * *

Contract Work Hours and Safety Standards--Overtime Compensation (May, 
2018)

* * * * *
    (b) Violation; liability for unpaid wages; liquidated damages. The 
responsible Contractor and subcontractor are liable for unpaid wages if 
they violate the terms in paragraph (a) of this clause. In addition, 
the Contractor and subcontractor are liable for liquidated damages 
payable to the Government. The Contracting Officer will assess 
liquidated damages at the rate specified at 29 CFR 5.5(b)(2) per 
affected employee for each calendar day on which the employer required 
or permitted the employee to work in excess of the standard workweek of 
40 hours without paying overtime wages required by the Contract Work 
Hours and Safety Standards statute (found at 40 U.S.C. chapter 37). In 
accordance with the Federal Civil Penalties Inflation Adjustment Act of 
1990 (28 U.S.C. 2461 Note), the Department of Labor adjusts this civil 
monetary penalty for inflation no later than January 15 each year.
* * * * *
[FR Doc. 2018-09167 Filed 4-30-18; 8:45 am]
 BILLING CODE 6820-14-P

19148 Federal Register / Vol. 83, No. 84 / Tuesday, May 1, 2018 / Rules and Regulations (12) Provides a copy of the assessment DEPARTMENT OF DEFENSE under a contract or subcontract subject made under paragraph (c)(11) of this to the overtime provisions of the section to the Agency Head and SBA GENERAL SERVICES Contract Work Hours and Safety Administrator; ADMINISTRATION Standards Act was required or permitted to work in excess of the (13) Provides to the chief acquisition NATIONAL AERONAUTICS AND standard workweek of 40 hours without officer and senior procurement SPACE ADMINISTRATION payment of the required overtime executive advice and comments on wages. Since this rate will continue to acquisition strategies, market research, 48 CFR Parts 22 and 52 change annually for inflation, FAR and justifications related to 22.302, Liquidated Damages and consolidation of contract requirements; [FAC 2005–98; FAR Case 2017–004; Item III; Docket No. 2017–0004, Sequence Overtime Pay, and paragraph (b) of FAR (14) When notified by a small No. 1] clause 52.222–4, Contract Work Hours business concern prior to the award of and Safety Standards—Overtime RIN 9000–AN37 Compensation, are revised to reference a contract that the small business concern believes that a solicitation, the current liquidated damages rate, as Federal Acquisition Regulation: request for proposal, or request for specified in the DOL regulations at 29 Liquidated Damages Rate Adjustment quotation unduly restricts the ability of CFR 5.5(b)(2). With this reference being the small business concern to compete AGENCY: Department of Defense (DoD), incorporated in lieu of the dollar for the award— General Services Administration (GSA), amount, an annual FAR change will not and National Aeronautics and Space be necessary. (i) Submits the notification by the Administration (NASA). small business concern to the III. Applicability to Contracts at or ACTION: Final rule. Below the Simplified Acquisition contracting officer and, if necessary, recommends ways in which the Threshold and for Commercial Items, SUMMARY: DoD, GSA, and NASA are Including Commercially Available Off- solicitation, request for proposal, or issuing a final rule to amend the Federal the-Shelf Items request for quotation may be altered to Acquisition Regulation (FAR) to adjust increase the opportunity for for inflation the rate of liquidated This rule amends the FAR to refer to competition; and damages assessed for violations of the the rate of liquidated damages for overtime provisions of the Contract violations of the overtime provisions of (ii) Informs the advocate for the Contract Work Hours and Safety competition of such agency (as Work Hours and Safety Standards Act. Standards Act, in accordance with DOL established under 41 U.S.C 1705 or 10 DATES: Effective: May 31, 2018. regulations, rather than provide a U.S.C. 2318) of such notification; FOR FURTHER INFORMATION CONTACT: Ms. specific dollar rate, because this rate is (15) Ensures agency purchases using Zenaida Delgado, Procurement Analyst, adjusted annually. The revisions do not the Governmentwide purchase card that at 202–969–7207 for clarification of add any new burdens or impact content. For information pertaining to applicability of clauses and provisions are greater than the micro-purchase status or publication schedules, contact at or below the simplified acquisition threshold and less than the simplified the Regulatory Secretariat Division at threshold, or to commercial items. acquisition threshold were made in 202–501–4755. Please cite FAC 2005– compliance with the Small Business Act 98, FAR Case 2017–004. IV. Publication of This Final Rule for and were properly recorded in Public Comment Is Not Required by SUPPLEMENTARY INFORMATION: accordance with subpart 4.6 in the Statute Federal Procurement Data System; I. Background The statute that applies to the (16) Assists small business contractors DoD, GSA, and NASA are issuing a publication of the Federal Acquisition and subcontractors in finding resources final rule amending the Federal Regulation (FAR) is the Office of Federal for education and training on Acquisition Regulation (FAR) to Procurement Policy statute (codified at compliance with contracting implement the Department of Labor title 41 of the United States Code). regulations; (DOL) interim final rule published in Specifically, 41 U.S.C. 1707(a)(1) the Federal Register at 81 FR 43430 on requires that a procurement policy, (17) Reviews all subcontracting plans July 1, 2016, the final rule published in regulation, procedure, or form required by 19.702(a) to ensure the plan (including an amendment or the Federal Register at 82 FR 5373 on provides maximum practicable modification thereof) must be published January 18, 2017, and subsequent opportunity for small business concerns for public comment if it relates to the adjustments for inflation pursuant to the to participate in the performance of the Federal Civil Penalties Inflation expenditure of appropriated funds, and contract; and Adjustment Act of 1990, as amended by has either a significant effect beyond the (18) Performs other duties listed at 15 the Federal Civil Penalties Inflation internal operating procedures of the U.S.C. 644(k). Adjustment Act Improvements Act of agency issuing the policy, regulation, * * * * * 2015 (Inflation Adjustment Act) (section procedure, or form, or has a significant [FR Doc. 2018–09166 Filed 4–30–18; 8:45 am] 701 of Pub. L. 114–74) (28 U.S.C. 2461 cost or administrative impact on BILLING CODE 6820–EP–P Note). The Inflation Adjustment Act contractors or offerors. This final rule is requires agencies to adjust the levels of not required to be published for public civil monetary penalties for inflation no comment, because this final FAR rule merely implements the requirements of amozie on DSK30RV082PROD with RULES2 later than January 15 of each year. the DOL rule that was published for II. Discussion and Analysis comment—interim final rule published The DOL rule set the new rate of in the Federal Register at 81 FR 43430 liquidated damages at $25 per on July 1, 2016, and the final rule individual for each calendar day on published in the Federal Register at 82 which a laborer or mechanic employed FR 5373 on January 18, 2017. The new VerDate Sep<11>2014 18:35 Apr 30, 2018 Jkt 244001 PO 00000 Frm 00006 Fmt 4701 Sfmt 4700 E:\FR\FM\01MYR2.SGM 01MYR2

Federal Register / Vol. 83, No. 84 / Tuesday, May 1, 2018 / Rules and Regulations 19149 DOL rate is required by statute (the PART 22—APPLICATION OF LABOR penalty for inflation no later than Inflation Adjustment Act); GSA, DoD, LAWS TO GOVERNMENT January 15 each year. and NASA have no authority to change ACQUISITIONS * * * * * the rate. [FR Doc. 2018–09167 Filed 4–30–18; 8:45 am] ■ 2. Amend section 22.302 by revising BILLING CODE 6820–14–P V. Executive Orders 12866 and 13563 paragraph (a) to read as follows: Executive Orders (E.O.s) 12866 and 22.302 Liquidated damages and overtime 13563 direct agencies to assess all costs pay. DEPARTMENT OF DEFENSE and benefits of available regulatory (a) When an overtime computation alternatives and, if regulation is GENERAL SERVICES discloses underpayments, the necessary, to select regulatory ADMINISTRATION responsible contractor or subcontractor approaches that maximize net benefits must pay the affected employee any (including potential economic, NATIONAL AERONAUTICS AND unpaid wages and pay liquidated environmental, public health and safety SPACE ADMINISTRATION damages to the Government. The effects, distributive impacts, and contracting officer must assess equity). E.O. 13563 emphasizes the 48 CFR Part 49 liquidated damages at the rate specified importance of quantifying both costs at 29 CFR 5.5(b)(2) per affected [FAC 2005–98, FAR Case 2015–039; Item and benefits, of reducing costs, of employee for each calendar day on IV; Docket No. 2015–0039, Sequence harmonizing rules, and of promoting which the employer required or No. 1] flexibility. This is not a significant permitted the employee to work in RIN 9000–AN26 regulatory action and, therefore, was not excess of the standard workweek of 40 subject to review under Section 6(b) of hours without paying overtime wages Federal Acquisition Regulations: Audit E.O. 12866, Regulatory Planning and required by the statute. In accordance of Settlement Proposals Review, dated September 30, 1993. This with the Federal Civil Penalties rule is not a major rule under 5 U.S.C. AGENCY: Department of Defense (DoD), Inflation Adjustment Act of 1990 (28 General Services Administration (GSA), 804. U.S.C. 2461 Note), the Department of and National Aeronautics and Space VI. Executive Order 13771 Labor adjusts this civil monetary Administration (NASA). penalty for inflation no later than This rule is not subject to E.O. 13771, ACTION: Final rule. January 15 each year. because this rule is not a significant regulatory action under E.O. 12866. * * * * * SUMMARY: DoD, GSA, and NASA are issuing a final rule to amend the Federal VII. Regulatory Flexibility Act PART 52—SOLICITATION PROVISIONS Acquisition Regulation (FAR) to raise Because a notice of proposed AND CONTRACT CLAUSES the dollar threshold requirement for the rulemaking and an opportunity for ■ 3. Amend section 52.222–4 by audit of prime contract settlement public comment are not required to be revising the date of the clause and proposals and subcontract settlements given for this rule under 41 U.S.C. paragraph (b) to read as follows: from $100,000 to align with the 1707(a)(1) (see section IV. of this threshold for obtaining certified cost or preamble), the analytical requirements 52.222–4 Contract Work Hours and Safety pricing data. of the Regulatory Flexibility Act (5 Standards—Overtime Compensation. DATES: Effective: May 31, 2018. U.S.C. 601 et seq.) are not applicable. * * * * * FOR FURTHER INFORMATION CONTACT: Ms. Accordingly, no regulatory flexibility Contract Work Hours and Safety Zenaida Delgado, Procurement Analyst, analysis is required and none has been Standards—Overtime Compensation at 202–969–7207, for clarification of prepared. (May, 2018) content. For information pertaining to status or publication schedules, contact VIII. Paperwork Reduction Act * * * * * the Regulatory Secretariat Division at The rule does not contain any (b) Violation; liability for unpaid 202–501–4755. Please cite FAC 2005– information collection requirements that wages; liquidated damages. The 98, FAR Case 2015–039. require the approval of the Office of responsible Contractor and SUPPLEMENTARY INFORMATION: Management and Budget under the subcontractor are liable for unpaid Paperwork Reduction Act (44 U.S.C. wages if they violate the terms in I. Background chapter 35). paragraph (a) of this clause. In addition, DOD, GSA, and NASA published a the Contractor and subcontractor are proposed rule in the Federal Register at List of Subjects in 48 CFR Parts 22 and liable for liquidated damages payable to 81 FR 63158 on September 14, 2016, to 52 the Government. The Contracting amend FAR 49.107 to increase the Government procurement. Officer will assess liquidated damages at dollar threshold for the audit of prime Dated: April 25, 2018. the rate specified at 29 CFR 5.5(b)(2) per contract settlement proposals and William F. Clark, affected employee for each calendar day subcontract settlements submitted in the on which the employer required or event of contract termination, from Director, Office of Government-wide Acquisition Policy, Office of Acquisition permitted the employee to work in $100,000 to align with the threshold in Policy, Office of Government-wide Policy. excess of the standard workweek of 40 FAR 15.403–4(a)(1) for obtaining hours without paying overtime wages certified cost or pricing data, which is Therefore, DoD, GSA, and NASA required by the Contract Work Hours amozie on DSK30RV082PROD with RULES2 currently $750,000. amend 48 CFR parts 22 and 52 as set and Safety Standards statute (found at forth below: 40 U.S.C. chapter 37). In accordance II. Discussion and Analysis ■ 1. The authority citation for parts 22 with the Federal Civil Penalties No public comments were submitted and 52 continues to read as follows: Inflation Adjustment Act of 1990 (28 in response to the proposed rule. Authority: 40 U.S.C. 121(c); 10 U.S.C. U.S.C. 2461 Note), the Department of Therefore, there are no changes from the chapter 137; and 51 U.S.C. 20113. Labor adjusts this civil monetary proposed rule made in the final rule. VerDate Sep<11>2014 18:35 Apr 30, 2018 Jkt 244001 PO 00000 Frm 00007 Fmt 4701 Sfmt 4700 E:\FR\FM\01MYR2.SGM 01MYR2


Document Created: 2018-05-01 00:24:37
Document Modified: 2018-05-01 00:24:37
CategoryRegulatory Information
CollectionFederal Register
sudoc ClassAE 2.7:
GS 4.107:
AE 2.106:
PublisherOffice of the Federal Register, National Archives and Records Administration
SectionRules and Regulations
ActionFinal rule.
DatesEffective: May 31, 2018.
ContactMs. Zenaida Delgado, Procurement Analyst, at 202-969-7207 for clarification of content. For information pertaining to status or publication schedules, contact the Regulatory Secretariat Division at 202-501-4755. Please cite FAC 2005-98, FAR Case 2017-004.
FR Citation83 FR 19148 
RIN Number9000-AN37
CFR Citation48 CFR 22
48 CFR 52
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