Overview
This section outlines the consequences for entities that violate the Service Contract Labor Standards statute, specifically mandating their exclusion from federal contracting opportunities via the System for Award Management (SAM).
Key Rules
- SAM Listing: Violators are assigned an active exclusion record in the System for Award Management (SAM) database.
- Award Prohibition: No government contract may be awarded to any person or firm listed as a violator.
- Substantial Interest Rule: The prohibition extends to any firm, corporation, partnership, or association where the violator holds a "substantial interest."
- Scope of Ineligibility: The ban on awards applies to both prime contracts and subcontracts.
- Exception Clause: Awards to ineligible contractors can only occur with the explicit approval of the Secretary of Labor.
Practical Implications
- Contracting Officers must verify the exclusion status of potential awardees in SAM to prevent illegal awards to labor law violators.
- Prime contractors are responsible for vetting their subcontractors, as they are prohibited from entering into agreements with firms listed for Service Contract Labor Standards violations.