Service Contract Act Compliance

Wage determinations and benefits for federal service contracts

Last reviewed on May 12, 2026.

Service Contract Act Overview

The Service Contract Act (SCA) requires contractors and subcontractors performing services on federal contracts over $2,500 to pay service employees prevailing wages and fringe benefits.

$2,500
Contract Threshold
$4.90/hr
Min H&W Benefit 2024
300+
Labor Categories

Covered Service Contracts

Typical Services

  • Janitorial and custodial
  • Food services
  • Guard and security
  • Landscaping/groundskeeping
  • IT support services

Professional Services

  • Administrative support
  • Data entry/processing
  • Equipment maintenance
  • Transportation services
  • Recreation services

Exemptions

  • Construction contracts (Davis-Bacon)
  • Transportation under published tariffs
  • Communications services
  • Professional employees
  • Contracts outside US

Health & Welfare Benefits

2024 Requirements

Minimum H&W Rate: $4.90 per hour
Can be provided as: Bona fide benefits OR cash equivalent
Qualifying Benefits: Health insurance, retirement, vacation, holidays

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