FAR 22.1007—Requirement to obtain wage determinations.
Plain-English Summary
FAR 22.1007 tells the contracting officer when to obtain prevailing wage determinations under the Service Contract Labor Standards for service contracts. It covers three main situations: new solicitations and contracts over the $2,500 threshold, contract modifications that push a contract above $2,500 and either extend performance or significantly change the labor requirements, and multiple-year contracts over $2,500 at specified anniversary dates depending on whether the contract is funded by annual appropriations. The rule exists to ensure the contract includes the correct wage and fringe benefit requirements for covered service employees based on current Department of Labor wage determinations. In practice, this means the contracting officer must check wage determination timing at award, before certain modifications, and at recurring intervals for multi-year contracts so the solicitation or contract reflects the applicable labor standards. The section is important because failing to obtain the right wage determination can lead to noncompliant pricing, contract administration problems, and disputes over wage obligations.
Key Rules
New covered solicitations
For each new solicitation and contract in excess of $2,500, the contracting officer must obtain a wage determination. This ensures the solicitation includes the current wage and fringe benefit requirements before award.
Modifications above threshold
If a contract modification brings the contract above $2,500, the contracting officer must obtain a wage determination when the modification also extends the contract under an option clause or otherwise, or when it significantly changes the scope so labor requirements are affected. The trigger is not just the dollar increase; the change must also fit one of these two conditions.
Annual review for annual appropriations
For multiple-year contracts over $2,500 that are subject to annual appropriations, the contracting officer must obtain a wage determination on each annual anniversary date. This keeps wage requirements current throughout the life of the contract.
Biennial review for nonannual appropriations
For multiple-year contracts over $2,500 that are not subject to annual appropriations and whose proposed term exceeds two years, the contracting officer must obtain a wage determination on each biennial anniversary date, unless the Wage and Hour Division advises otherwise. This creates a recurring update cycle for longer-term contracts.
Wage and Hour Division exception
The biennial anniversary-date requirement is subject to any contrary advice from the Wage and Hour Division. If DOL provides different guidance, the contracting officer must follow that guidance instead of the default timing rule.
Responsibilities
Contracting Officer
Obtain the applicable wage determinations for covered service contracts at solicitation and award, before qualifying modifications, and at the required annual or biennial anniversary dates for multiple-year contracts. The contracting officer must also determine whether a modification both exceeds the $2,500 threshold and meets the extension or significant scope-change condition.
Agency
Support contract administration so wage determinations are requested and incorporated on time, especially for recurring updates on multi-year contracts and for actions that may change the labor mix or contract term.
Contractor
Monitor contract changes and performance periods, and be prepared to comply with updated wage determinations when the contracting officer incorporates them. The contractor must price and pay labor in accordance with the applicable determination once it is included in the contract.
Wage and Hour Division
Provide guidance that may alter the default biennial timing rule for nonannual-appropriation multiple-year contracts. Its advice controls when it differs from the standard requirement.
Practical Implications
This section is a timing rule as much as a coverage rule: the key question is not only whether the contract is a service contract over $2,500, but also when a new wage determination must be pulled into the file.
A common pitfall is assuming every modification over $2,500 requires a new wage determination; the rule applies only when the modification also extends the contract or significantly changes labor requirements.
For multi-year contracts, contracting officers need a calendar control system to catch annual or biennial anniversary dates, or they risk missing required updates.
Contractors should watch for wage determination updates that can affect labor costs, especially on option exercises, extensions, and scope changes.
If the Wage and Hour Division gives specific advice for a contract, that guidance can override the default biennial timing, so contracting personnel should document and follow any DOL direction carefully.
Official Regulatory Text
The contracting officer shall obtain wage determinations for the following service contracts: (a) Each new solicitation and contract in excess of $2,500. (b) Each contract modification which brings the contract above $2,500 and- (1) Extends the existing contract pursuant to an option clause or otherwise; or (2) Changes the scope of the contract whereby labor requirements are affected significantly. (c) Each multiple year contract in excess of $2,500 upon- (1) Annual anniversary date if the contract is subject to annual appropriations; or (2) Biennial anniversary date if the contract is not subject to annual appropriations and its proposed term exceeds 2 years-unless otherwise advised by the Wage and Hour Division.