Contractor pays high price for shorting prevailing wage — Business Management Daily: Free Reports on Human Resources, Employment Law, Office Management, Office Communication, Office Technology and Small Business Tax Business Management Daily

Contractor pays high price for shorting prevailing wage

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Air Force contractor General Atomics Aeronautical Systems, based in San Diego, will pay 901 workers more than $945,000 after government auditors found the company had not paid them the prevailing wage mandated by the federal McNamara-O’Hara Service Contract Act.

The law requires federal contractors to pay wages and fringe benefits no less than those that prevail in the locality where contracted work is performed.

General Atomics builds unmanned aircraft and surveillance systems for the Air Force.

The wage shortfall occurred because General Atomics paid workers the prevailing wage in the area where they were based, not where they worked. When workers traveled to remote locations, which in many cases required a higher pay scale.

Department of Labor officials said General Atomics cooperated fully with investigators.

Note: Government contractors who must pay prevailing wages should capture the job’s location and pay the worker prevailing wages for that area.

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