U.S. Department of Labor 
Employment Standards Administration
Wage and Hour Division
Washington, D.C. 30210
DEC 23 1985
MEMORANDUM NO. 143
TO: ALL CONTRACTING AGENIES OF THE FEDERAL
GOVERNMENT AND THE DISTRICT OF COLUMBIA
FROM: HERBERT J. COHEN
Deputy Administrator
SUBJECT: Repeal of Daily Overtime Compensation
Requirements Applicable to Employees Performing
on Federal and Federally Assisted Contracts
On November 8, 1985, the Department of Defense Authorization Act
of 1986, Pub. L. No. 99-145, was enacted into law.
A provision of this law amends the Contract Work Hours and Safety
Standards Act (CWHSSA) and the Walsh-Healey Public Contracts Act
(PCA) to eliminate the requirement that contractors pay employees
performing on Federal or Federally assisted construction
contracts, and Federal service or supply contracts, time and one-
half their basic rates of pay for hours worked in excess of 8
hours per day on or after January 1, 1986. Overtime compensation
will continue to be required under these statutes for hours
worked in excess of 40 hours per week.
Revisions to the applicable contract labor standards regulations
(29 CFR Parts 4 and 5 and 41 CFR Part 50-201) to delete
references to these daily overtime requirements will be published
in the near future.
Contracting agencies should be aware that certain contractors may
continue to have obligations to pay daily overtime compensation
pursuant to State or local laws, collective bargaining
agreements, or employment contracts after January 1, 1986.
However, whether contractual provisions agreed to prior to
January 1, 1986, requiring overtime compensation after 8 hours of
work can be enforced after January 1, 1986, is a question of
contract law between the parties independent of the Department of
Labor's authority under CWHSSA and PCA. Accordingly, the
Department will take no action to enforce daily overtime
requirements with respect to hours worked on any Federal
contracts after January 1, 1986.