FAR 22.603—Applicability.
Plain-English Summary
FAR 22.603 explains when the labor standards requirements in FAR 22.602 apply. It covers contracts and subcontracts under section 8(a) of the Small Business Act for the manufacture or furnishing of supplies, and it expressly includes indefinite-delivery contracts, basic ordering agreements, and blanket purchase agreements for this purpose. The section limits coverage to work performed in the United States, Puerto Rico, or the U.S. Virgin Islands, and only when the contract or subcontract exceeds, or may exceed, $20,000. It also makes clear that the rule applies only if the action is not exempt under FAR 22.604. In practice, this section is the threshold test for deciding whether the applicable labor standards must be flowed into an 8(a) supply procurement or subcontract, so contracting officers and contractors must check the place of performance, dollar value, contract type, and exemption status before assuming coverage.
Key Rules
Applies to 8(a) supply work
The section applies to contracts and subcontracts under section 8(a) of the Small Business Act when the work is for the manufacture or furnishing of supplies. It is not a general rule for all federal contracts; it is tied specifically to 8(a) supply acquisitions.
Includes ordering vehicles
For this applicability test, indefinite-delivery contracts, basic ordering agreements, and blanket purchase agreements are treated as contracts. That means these vehicles can trigger coverage if the underlying supply work meets the other conditions.
Geographic limitation
Coverage applies only when the work will be performed in the United States, Puerto Rico, or the U.S. Virgin Islands. If performance is outside these locations, this section does not apply.
Dollar threshold
The contract or subcontract must exceed, or may exceed, $20,000. The phrase 'may exceed' means the threshold can be met even when the final value is not yet certain at award.
Subject to exemptions
Even if the other conditions are met, the requirements do not apply if the action is exempt under FAR 22.604. The exemption analysis must be completed before concluding that coverage exists.
Responsibilities
Contracting Officer
Determine whether the 8(a) supply contract or subcontract meets the place-of-performance and dollar-threshold tests, treat covered ordering vehicles as contracts for this purpose, and verify whether any FAR 22.604 exemption applies before including the requirements of FAR 22.602.
8(a) Contractor
Identify whether the procurement is covered, ensure compliance with the applicable labor standards requirements when the contract falls within this section, and flow down any required obligations to covered subcontracts.
Subcontractor
Comply with the applicable requirements when performing a covered subcontract for 8(a) supply work in the specified locations and above the threshold, subject to any applicable exemption analysis.
Agency/Program Office
Provide accurate acquisition planning information about the place of performance, estimated value, and contract vehicle so the contracting officer can determine whether the section applies.
Practical Implications
This is a threshold-and-scope provision: before applying FAR 22.602, you must confirm the procurement is an 8(a) supply action, the work location is covered, the value meets the threshold, and no exemption applies.
Contracting officers should not overlook IDIQs, BOAs, or BPAs; these vehicles are expressly included and can create coverage even when the individual order value is not yet fixed.
A common pitfall is assuming that a small or uncertain award is outside the rule; the 'may exceed $20,000' language means anticipated or possible value matters.
Another frequent mistake is skipping the exemption review under FAR 22.604, which can lead to unnecessary clause insertion or, conversely, failure to apply required labor standards.
Contractors and subcontractors should check the solicitation and award documents early so they know whether compliance obligations will attach and can price, staff, and administer the work accordingly.
Official Regulatory Text
The requirements in 22.602 apply to contracts (including for this purpose, indefinite-delivery contracts, basic ordering agreements, and blanket purchase agreements) and subcontracts under Section 8(a) of the Small Business Act, for the manufacture or furnishing of supplies that- (a) Will be performed in the United States, Puerto Rico, or the U.S. Virgin Islands; (b) Exceed or may exceed $20,000; and (c) Are not exempt under 22.604 .