# What is the Service Contract Act?

URL: https://us.falkview.com/glossary/service-contract-act/
Updated: 2026-11-04

> **What is the Service Contract Act?**
>
> The Service Contract Act, now codified as the Service Contract Labor Standards statute, requires contractors on federal service contracts over $2,500 to pay service employees at least the wages and fringe benefits in the contract's wage determination. It covers most janitorial, grounds and facilities support contracts performed in the United States.

## Key facts

- Applies to federal contracts over $2,500 whose main purpose is services performed by service employees in the US.
- Implemented in FAR subpart 22.10 and the clause at FAR 52.222-41.
- Construction is covered by the Davis-Bacon Act instead.

## Why it matters for facility-services bids

It turns the wage determination into a legal minimum for every hour your cleaners and groundskeepers work on the contract, including paid leave and health and welfare.

## Sources

- [FAR 22.1002-1, Service Contract Labor Standards: general](https://www.acquisition.gov/far/22.1002-1)
- [29 CFR part 4, labor standards for federal service contracts](https://www.ecfr.gov/current/title-29/subtitle-A/part-4)
- [U.S. Department of Labor, Service Contract Act](https://www.dol.gov/agencies/whd/government-contracts/service-contracts)

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