Federal wage modifications: 2 cutoffs for bid and award

Key takeaways: the two cutoffs

• Written modifications received after bid opening are not effective for the solicitation and are not included in it.
• Written modifications received before contract award are effective, and revisions communicated within the prescribed timeframes must be included in the resulting contract.
• A modification received less than 10 calendar days before bid opening is subject to an exception when the contracting officer finds there is not reasonable time to notify bidders.
• Log the date each change was received beside the bid-opening and award dates in your bid file before you lock labor rates.
• Check the publication date of any state source before use.

Which wage modifications the rule covers

The rule covers two kinds of change. It names "written actions modifying wage determinations" received by the contracting agency, and it also names "modifications to general wage determinations published on the Wage Determinations at SAM.gov," according to Acquisition.gov. Both forms run through the same before-and-after tests, so one bid file can hold them side by side.

The cutoffs tie to the date the contracting agency receives a change and to publication on the Wage Determinations at SAM.gov, according to Acquisition.gov. Those two events are the dates to capture for each change. If a change reached your file by any other route, note its source and confirm the date with the contracting office.

A short list works best: one line for each change, with its form, its date received or publication date and the project it covers. The one-line format is a recommendation from this guide, so use whatever layout your estimating file already supports. A file that separates the two forms also shows which change came from SAM.gov and which arrived as a written action.

For how the wage rate itself is chosen, see construction wage selection. Use that page alongside the modification log, not in place of it, because the log records each change and the page concerns wage selection. Keeping both in one folder keeps the rate and its basis together.

Before you carry a rate forward, match each modification in the log to the solicitation it was meant for and note any mismatch in the file. A mismatch is worth raising with the contracting office in writing, since the bid-opening cutoff is written in terms of the solicitation and the award cutoff is written in terms of contract award. Record the reply next to the entry, so the reasoning behind the rate can be read later.

The 10-day test before bid opening

The federal text sets out a separate case for timing close to bid opening. It covers a change that "is received by the contracting agency, or is published on the Wage Determinations at SAM.gov, less than 10 calendar days before the date of bid opening," according to Acquisition.gov. Treat that window as a flag for a closer review of the timing.

The clause then sets an exception, according to Acquisition.gov, reading "unless the contracting officer finds that there is not reasonable time available before bid opening to notify the prospective bidders." That finding belongs to the contracting officer, so an estimator should not assume the exception applies without a finding in hand. Note whether the file contains a written finding for each change inside the window.

Each entry should record the calendar days from the date received or the publication date to bid opening. That count makes the window visible before any rate is priced. Put the counted date beside the entry, so anyone reviewing the file can see how the window was measured. Use the same counting method for every change so the entries compare fairly.

A written question to the contracting office should cover whether a change inside that window was treated under the exception. Your file should hold the reply with the bid file and log, so the answer stays on record. If the office does not reply in writing, note that gap as well, since the exception rests on a finding.

The 10-day test comes from the federal text, so it should not be used to judge a state wage rate. Check which source a rate came from before applying any window, and record that source beside the entry. A state source should be judged by its own text and publication date, not by the federal timing.

Illustrative example: counting the window

Suppose bid opening is set for 20 October and a change is received on 10 October. The gap is 10 calendar days, and the window covers changes received less than 10 days before opening, so this change falls outside it. A change received on 13 October, 7 calendar days before opening, would fall inside it. The count still goes in the entry, so the same method applies to every change.

The bid-opening cutoff

The rule's bid-opening sentence carries a cross-reference, paragraph (b)(6), which points to a further provision. Read that provision in the full text before you rely on the bid-opening cutoff alone.

Each change that arrives after bid opening should be logged with a note marking it as not effective for the solicitation. Place the note beside the bid-opening date, so the two are read together. Use the same wording for every such change so the log reads consistently across projects. A simple column for the bid-opening date keeps that comparison visible without extra steps.

For checks on the labor side before costs are fixed, see public bid labor checks. Those checks are a separate step from the cutoff test, so run both before the labor rate is final. The cutoff test answers whether a change counts, while the labor checks cover the rest of the cost.

A rate built on a change received after bid opening needs a second look, because the quoted rule says that change is not included in the solicitation. Read paragraph (b)(6) of 22.404-6 first. Only if that provision does not change the outcome for the change in question should the rate be rebuilt from the modifications inside the cutoff, with that rebuild noted in the file.

The award cutoff and the resulting contract

Modifications received before award run the other way, according to Acquisition.gov. The award date is the second edge of that window, so it belongs in the same log as the bid-opening date.

The resulting contract is the next point in the rule. Revisions published on the Wage Determinations at SAM.gov website or otherwise communicated to the contracting officer within the timeframes prescribed at 22.404-6(b) and (c) "are applicable and must be included in the resulting contract," according to Acquisition.gov. Note the timeframes in that sentence, since they are part of the condition.

A change received between bid opening and award is effective under the award rule. When an effective modification for the primary site of the work "is received by the contracting officer after bid opening, but before award," the contracting officer "shall follow the procedures in 22.404-5(b)(2)(i) or (ii)," according to Acquisition.gov. Ask the contracting office which of those two procedures applies.

Your record should hold the award date, the date each change was received between bid and award, and any written reply from the contracting office. One log can then serve both cutoffs, so the file does not need two sets of dates.

Once the award date is logged, reread the bid package for any wage reference that predates the latest change in the log. A reference that does not match the latest entry should be raised with the contracting office before the rate is locked, because the award rule turns on what the contracting agency receives and when.

Fringe benefit costs in the wage

Benefit costs enter the wage through a finding by the Secretary of Labor, according to Acquisition.gov, which describes wages that "include the amount of any costs reasonably anticipated in providing benefits under a plan or program described in 40 U.S.C."

The finding is made under paragraph (d) of the clause entitled Construction Wage Rate Requirements, according to Acquisition.gov. Locate that clause in the contract before reading any finding, so the reference is clear.

Benefit-cost inputs work best on a line of their own in the labor build-up, so a finding can be matched to them without rebuilding the rate. This is a recommendation from this guide. Use the line item label that your own estimating file already uses.

Overtime is a separate input, so see construction overtime cost inputs for it. The overtime line fits best once the labor build-up is complete, so it and the benefit line are checked against one rate.

Your file should carry the date of any finding beside the modification log entries, so the wage and the benefit-cost basis can be read together.

Source checks: publication dates and records

Payroll records follow a separate clock, according to Acquisition.gov, which says payrolls and basic records "shall be maintained by the Contractor during the course of the work and preserved for a period of 3 years thereafter for all laborers and mechanics working at the site of the work."

Your file should tie payroll records to the wage rate that applied, so each record can be matched to its modification. Store them for the 3 years the rule sets after the work, and note the end date of the work beside the entry. A record without its rate basis is harder to match later.

Each source note in the file should give the publisher name as it appears on the source page, with the URL kept beside it. The table below lists each rule with its source.

Next step before you lock labor rates

Your next step is to log the date each wage modification was received beside the bid-opening and award dates in your bid file before you lock labor rates. One entry of this kind lets the 10-day check and both cutoffs be read from the same line.

FAQ

Is a modification received after bid opening used?

Not under the quoted paragraph alone: a modification received after bid opening is not effective for the solicitation, according to Acquisition.gov, but that sentence is subject to paragraph (b)(6), so read that provision before relying on this answer. Your log should show the date each change was received, so the bid-opening comparison can be checked.

What happens to a modification received before award?

It is effective under the award rule, according to Acquisition.gov. Your file should record the timeframe before relying on that outcome.

What is the 10-day rule?

The 10-day rule covers a modification received less than 10 calendar days before bid opening, which is subject to an exception when the contracting officer finds there is not reasonable time to notify bidders. The exception, according to Acquisition.gov, turns on that finding. Your file should hold the contracting office's written finding for each change inside that window, if one is given.

How do benefit costs enter the wage?

Through a finding by the Secretary of Labor. The finding concerns wages that include anticipated costs, as described in the federal text, according to Acquisition.gov. Look for the paragraph (d) reference in the clause before relying on any finding.

How long must payroll records be kept?

Payroll and basic records must be kept for 3 years after the work, according to Acquisition.gov. Your file should tie each entry to the rate that applied.