FAR 37.301—Labor standards.
Plain-English Summary
FAR 37.301 explains which federal labor standards statute applies to contracts for dismantling, demolition, or removal of improvements. It addresses the key coverage question between the Service Contract Labor Standards (41 U.S.C. chapter 67) and the Construction Wage Rate Requirements statute, formerly Davis-Bacon, under 40 U.S.C. chapter 31, subchapter IV. The section draws a bright line: if the contract is only for dismantling, demolition, or removal, the Service Contract Labor Standards generally apply; but if the work is tied to contemplated construction, alteration, or repair of a public building or public work at that location, then the construction wage statute applies instead. It also makes clear that the later construction work can be covered even if it will be awarded under a separate contract, so agencies cannot avoid construction wage coverage by splitting the work into multiple procurements. In practice, this section is about proper labor-statement classification at the planning and solicitation stage, because the wrong statute means the wrong wage determinations, clauses, and contractor compliance obligations. It is especially important for agencies planning site clearance, teardown, or removal work where redevelopment, renovation, or replacement is expected.
Key Rules
Default rule for pure demolition
If the contract is solely for dismantling, demolition, or removal of improvements, the Service Contract Labor Standards statute applies. In other words, when the work ends with removal and does not include or support construction-related follow-on work at that location, treat it as a service contract for labor-standards purposes.
Construction intent changes coverage
If further work is contemplated that will result in the construction, alteration, or repair of a public building or public work at that location, the Construction Wage Rate Requirements statute applies to the demolition or removal contract. The deciding factor is the intended end use of the site, not just the immediate scope of the demolition contract.
Separate contracts do not avoid coverage
The construction wage statute applies even if the later construction, alteration, or repair work will be awarded under a separate contract. Agencies must look at the overall project plan, not just the isolated procurement package, when determining labor standards coverage.
Location-specific analysis required
The rule turns on whether the contemplated construction, alteration, or repair will occur at that same location. Contracting personnel must evaluate the site-specific project plan to determine whether demolition is part of a broader construction effort.
Proper statute drives clause selection
Once the applicable statute is identified, the solicitation and contract must include the correct labor standards clauses and wage requirements. Misclassification can lead to noncompliant solicitations, incorrect wage determinations, and downstream enforcement problems.
Responsibilities
Contracting Officer
Determine whether the contract is solely for demolition/removal or is part of a broader construction, alteration, or repair effort at the location. Select the correct labor standards statute, include the proper clauses and wage requirements, and avoid structuring the procurement in a way that misstates the true nature of the work.
Agency Program/Project Officials
Provide the contracting officer with the full project plan, including any planned follow-on construction, alteration, or repair work at the site, even if that work will be separately contracted. Ensure the acquisition strategy reflects the actual intended use of the location.
Contractor
Review the solicitation and contract labor requirements and comply with the applicable wage and labor standards. If the scope or project context suggests the wrong statute was applied, raise the issue promptly through the contracting officer rather than assuming the classification is correct.
Labor Standards/Acquisition Support Staff
Assist in identifying the correct labor standards coverage, obtaining the appropriate wage determinations, and ensuring the solicitation package matches the project’s actual scope and intended follow-on work.
Practical Implications
The biggest day-to-day issue is coverage determination: demolition-only work is not automatically a construction contract, but it becomes construction-covered if the site is being cleared for planned building, alteration, or repair work.
Agencies should not rely only on the wording of the current contract; they must consider the broader project and any planned future work at the same location, even if that future work is separately procured.
A common pitfall is splitting demolition and construction into separate contracts and assuming the demolition contract can stay under service-contract labor standards. FAR 37.301 says the later construction intent can pull the demolition contract into construction wage coverage.
Getting the statute wrong can mean using the wrong wage determination and clauses, which can create compliance disputes, bid protests, contract administration problems, and potential labor-law enforcement issues.
For contractors, the practical takeaway is to verify early whether the site is part of a redevelopment or repair project, because that affects labor costs, pricing, subcontract flowdowns, and payroll compliance from the start.
Official Regulatory Text
Contracts for dismantling, demolition, or removal of improvements are subject to either 41 U.S.C. chapter 67 , Service Contract Labor Standards, or 40 U.S.C. chapter 31 , subchapter IV, Wage Rate Requirements (Construction). If the contract is solely for dismantling, demolition, or removal of improvements, the Service Contract Labor Standards statute applies unless further work which will result in the construction, alteration, or repair of a public building or public work at that location is contemplated. If such further construction work is intended, even though by separate contract, then the Construction Wage Rate Requirements statute applies to the contract for dismantling, demolition, or removal.