What is the applies to service contracts over for Service Contract Act?

$2,500, per FAR 22.1002-1 This figure was read from that source on 2026-08-04; thresholds are revised, so check the citation before relying on it in a bid.

Wages, bonds and the rulebook

What is the Service Contract Act?

Service Contract Labor Standards

The Service Contract Act, implemented in the FAR as Service Contract Labor Standards, requires service contracts over $2,500 to pay service employees no less than the wages and fringe benefits determined by the Department of Labor for the locality.

Also written as: SCA, McNamara-O'Hara Service Contract Act, service contract wage determination.

FAR 22.1002-1 states that service contracts over $2,500 must contain mandatory provisions regarding minimum wages and fringe benefits, safe and sanitary working conditions, notification of the minimum allowable compensation, and equivalent federal employee classifications and wage rates. (The same section cites 41 U.S.C. 6707(d) for a different rule — that a service contract may not exceed five years — so do not read that citation as the source of the wage obligation.) The obligation attaches to service employees — the people doing the work — rather than to bona fide executive, administrative or professional employees.

This is the statute that governs janitorial, grounds maintenance, security guard, food service, warehousing and a wide range of other support contracts. The wage determination lists a rate and a health-and-welfare fringe amount per classification, and both are obligations.

Where a contract succeeds one performed under a collective bargaining agreement, the predecessor's negotiated rates can carry forward under FAR 22.1002-3. A new bidder who prices off the standard wage determination without checking for that can win a contract it cannot perform profitably.

What this means when you bid

On a follow-on services contract, check whether the incumbent's workforce is covered by a collective bargaining agreement before you price. The successor rates may not be the ones on the standard determination.

Service Contract Act: the published figures

Each figure below was read from the regulation cited beside it on 2026-08-04. Thresholds are adjusted for inflation and changed by statute — follow the citation and confirm the figure in effect on your solicitation's date before you rely on it.

Applies to service contracts over: $2,500

Service Contract Act compared with the terms it gets confused with

Service Contract Act vs Davis-Bacon Act

The Service Contract Act covers services over $2,500; Davis-Bacon covers construction, alteration and repair over $2,000.

What Davis-Bacon Actmeans →

Where this definition comes from

Federal contracting is one of the few fields where the authoritative answer is free, public and one click away. These are the sources this page is built from — go and read them.

FAR 22.1002-1→
Service Contract Labor Standards statute wage determinations.
FAR 22.1002-3→
Wage determinations based on collective bargaining agreements.
41 U.S.C. ch. 67→
Service Contract Labor Standards — the Service Contract Act.
U.S. Department of Labor — wage determinations→

This page explains a term in plain English and cites the authority it comes from. It is not legal advice, and the regulation governs where this page and the regulation differ.

Free tools for government contractors

Knowing the term is one thing. These free tools do something with the Service Contract Act. No login, no credit card.

Wage Determination Lookup→

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Service Contract Act— common questions

What is the Service Contract Act?: The Service Contract Act, implemented in the FAR as Service Contract Labor Standards, requires service contracts over $2,500 to pay service employees no less than the wages and fringe benefits determined by the Department of Labor for the locality.
What is the difference between Service Contract Act and Davis-Bacon Act?: The Service Contract Act covers services over $2,500; Davis-Bacon covers construction, alteration and repair over $2,000.
What is the applies to service contracts over for Service Contract Act?: $2,500, per FAR 22.1002-1 This figure was read from that source on 2026-08-04; thresholds are revised, so check the citation before relying on it in a bid.
Why does the Service Contract Act matter when you are bidding?: On a follow-on services contract, check whether the incumbent's workforce is covered by a collective bargaining agreement before you price. The successor rates may not be the ones on the standard determination.

Related terms

Wage determination
Davis-Bacon Act — Wage Rate Requirements (Construction)
Time-and-materials — Time-and-Materials contract (T&M)
Micro-purchase threshold

NAICS industries where this comes up most

An editorial pointer, not a measurement. These are the codes whose work most often involves the Service Contract Act. Each page carries the official Census title, the SBA size standard where one is published for those exact digits, and whatever federal award history the record here holds for the code — which may be none, and says so when it is.