(a) General. Upon his or her own initiative or upon the request of
any Federal agency, the Secretary of Labor may provide under section 105
of the Contract Work Hours and Safety Standards Act reasonable
limitations and allow variations, tolerances, and exemptions to and from
any or all provisions of that Act whenever the Secretary finds such
action to be necessary and proper in the public interest to prevent
injustice, or undue hardship, or to avoid serious impairment of the
conduct of Government business. Any request for such action by the
Secretary shall be submitted in writing, and shall set forth the reasons
for which the request is made.
(b) Exemptions. Pursuant to section 105 of the Contract Work Hours
and Safety Standards Act, the following classes of contracts are found
exempt from all provisions of that Act in order to prevent injustice,
undue hardship, or serious impairment of Government business:
(1) Contract work performed in a workplace within a foreign country
or within territory under the jurisdiction of the United States other
than the following: A State of the United States; the District of
Columbia; Puerto Rico; the Virgin Islands; Outer Continental Shelf lands
defined in the Outer Continental Shelf Lands Act (ch. 345, 67 Stat.
462); American Samoa; Guam; Wake Island; Eniwetok Atoll; Kwajalein
Atoll; and Johnston Island.
(2) Agreements entered into by or on behalf of the Commodity Credit
Corporation providing for the storing in or handling by commercial
warehouses of wheat, corn, oats, barley, rye, grain sorghums, soybeans,
flaxseed, rice, naval stores, tobacco, peanuts, dry beans, seeds,
cotton, and wool.
(3) Sales of surplus power by the Tennessee Valley Authority to
States, counties, municipalities, cooperative organization of citizens
or farmers, corporations and other individuals pursuant to section 10 of
the Tennessee Valley Authority Act of 1933 (16 U.S.C. 8311).
(c) Tolerances. (1) The ``basic rate of pay'' under section 102 of
the Contract Work Hours and Safety Standards Act may be computed as an
hourly equivalent to the rate on which time-and-one-half overtime
compensation may be computed and paid under section 7 of the Fair Labor
Standards Act of 1938, as amended (29 U.S.C. 207), as interpreted in
part 778 of this title. This tolerance is found to be necessary and
proper in the public interest in order to prevent undue hardship.
(2) Concerning the tolerance provided in paragraph (c)(1) of this
section, the provisions of section 7(d)(2) of the Fair Labor Standards
Act and Sec. 778.7 of this title should be noted. Under these
provisions, payments for occasional periods when no work is performed,
due to
vacations, and similar causes are excludable from the ``regular rate''
under the Fair Labor Standards Act. Such payments, therefore, are also
excludable from the ``basic rate'' under the Contract Work Hours and
Safety Standards Act.
(3) See Sec. 5.8(c) providing a tolerance subdelegating authority to
the heads of agencies to make appropriate adjustments in the assessment
of liquidated damages totaling $500 or less under specified
circumstances.
(4)(i) Time spent in an organized program of related, supplemental
instruction by laborers or mechanics employed under bona fide
apprenticeship or training programs may be excluded from working time if
the criteria prescribed in paragraphs (c)(4)(ii) and (iii) of this
section are met.
(ii) The apprentice or trainee comes within the definition contained
in Sec. 5.2(n).
(iii) The time in question does not involve productive work or
performance of the apprentice's or trainee's regular duties.
(d) Variations. (1) In the event of failure or refusal of the
contractor or any subcontractor to comply with overtime pay requirements
of the Contract Work Hours and Safety Standards Act, if the funds
withheld by Federal agencies for the violations are not sufficient to
pay fully both the unpaid wages due laborers and mechanics and the
liquidated damages due the United States, the available funds shall be
used first to compensate the laborers and mechanics for the wages to
which they are entitled (or an equitable portion thereof when the funds
are not adequate for this purpose); and the balance, if any, shall be
used for the payment of liquidated damages.
(2) In the performance of any contract entered into pursuant to the
provisions of 38 U.S.C. 620 to provide nursing home care of veterans, no
contractor or subcontractor under such contract shall be deemed in
violation of section 102 of the Contract Work Hours and Safety Standards
Act by virtue of failure to pay the overtime wages required by such
section for work in excess of 40 hours in the workweek to any individual
employed by an establishment which is an institution primarily engaged
in the care of the sick, the aged, or the mentally ill or defective who
reside on the premises if, pursuant to an agreement or understanding
arrived at between the employer and the employee before performance of
the work, a work period of 14 consecutive days is accepted in lieu of
the workweek of 7 consecutive days for the purpose of overtime
compensation and if such individual receives compensation for employment
in excess of 8 hours in any workday and in excess of 80 hours in such
14-day period at a rate not less than 1\1/2\ times the regular rate at
which the individual is employed, computed in accordance with the
requirements of the Fair Labor Standards Act of 1938, as amended.
(3) Any contractor or subcontractor performing on a government
contract the principal purpose of which is the furnishing of fire
fighting or suppression and related services, shall not be deemed to be
in violation of section 102 of the Contract Work Hour and Safety
Standards Act for failing to pay the overtime compensation required by
section 102 of the Act in accordance with the basic rate of pay as
defined in paragraph (c)(1) of this section, to any pilot or copilot of
a fixed-wing or rotary-wing aircraft employed on such contract if:
(i) Pursuant to a written employment agreement between the
contractor and the employee which is arrived at before performance of
the work.
(A) The employee receives gross wages of not less than $300 per week
regardless of the total number of hours worked in any workweek, and
(B) Within any workweek the total wages which an employee receives
are not less than the wages to which the employee would have been
entitled in that workweek if the employee were paid the minimum hourly
wage required under the contract pursuant to the provisions of the
Service Contract Act of 1965 and any applicable wage determination
issued thereunder for all hours worked, plus an additional premium
payment of one-half times such minimum hourly wage for all hours worked
in excess of 40 hours in the workweek;
(ii) The contractor maintains accurate records of the total daily
and
weekly hours of work performed by such employee on the government
contract. In the event these conditions for the exemption are not met,
the requirements of section 102 of the Contract Work Hours and Safety
Standards Act shall be applicable to the contract from the date the
contractor or subcontractor fails to satisfy the conditions until
completion of the contract.
(Reporting and recordkeeping requirements in paragraph (d)(2) have been
approved by the Office of Management and Budget under control numbers
1215-0140 and 1215-0017. Reporting and recordkeeping requirements in
paragraph (d)(3)(ii) have been approved by the Office of Management and
Budget under control number 1215-0017)
[48 FR 19541, Apr. 29, 1983, as amended at 51 FR 12265, Apr. 9, 1986; 61
FR 40716, Aug. 5, 1996]
