Overview
FAR 22.604 outlines the specific circumstances and categories of supply contracts that are exempt from the Walsh-Healey Public Contracts Act labor standards. These exemptions are categorized into those mandated by statute and those established through Department of Labor regulations.
Key Rules
- Statutory Exemptions: The Act does not apply to "open market" purchases (including commercial products and services under FAR Part 12), items bought under public exigency (immediate delivery), perishables, or agricultural products processed for first sale by original producers.
- Geographic Limitation: Supplies manufactured outside the United States, Puerto Rico, and the U.S. Virgin Islands are fully exempt.
- Specific Service/Product Exemptions: Public utility services and certain contracts for newspapers or magazines (delivered by publishers but contracted through agents) are excluded.
- Defaulted Contracts: If a contract is terminated for default and the original contract did not include the Act's stipulations, the follow-on purchase against the defaulter's account is exempt.
- Administrative Exemptions: An agency head may request a specific exemption from the Secretary of Labor if applying the Act would "seriously impair" Government business. Requests are routed to OSHA for safety/health matters or the Wage and Hour Division for all other stipulations.
Practical Implications
- Commercial Acquisitions: Because most commercial products and services are considered "open market" purchases, they are generally exempt from these specific labor requirements, simplifying the solicitation process for commercial vendors.
- Global Supply Chain: Contracting officers do not need to apply Walsh-Healey stipulations to international manufacturing contracts, as the regulation specifically targets domestic production within the U.S. and its territories.