EP 1180-1-1
1 Aug 01
disclosing to a Member of Congress, or an authorized official of an agency or of the Department of
Justice, relating to a substantial violation of law related to a contract (including the competition for or
negotiation of a contract." In this regard, upon receipt of a SCA minimum wage rate complaint that
includes an allegation of retaliatory discharge, the complainant should be advised of the complaint
procedures set forth at FAR 3.904.
8-6. Cooperation with the DOL. COs shall cooperate with DOL representatives in the examination of
records, interviews with service employees, and all other aspects of investigations undertaken by the
DOL.
8-7. Withholding of Contract Payments.
a. In the event that a contractor fails to provide the requisite restitution to underpaid employees,
applicable regulations (29 CFR 4.187; FAR 22.1022) authorize the DOL to forward a request for a
withholding of contract earnings. It is mandatory for a CO to adhere to a request from the DOL to
withhold funds where such funds are available (see Decision of the Comptroller General, B-109257,
October 14, 1952, arising under the Walsh-Healey Act).
b. Unlike the DBA where withheld funds must be forwarded to the General Accounting Office (see
FAR 22.406-9(c)), the SCA provides that withheld funds shall be transferred to the DOL for
disbursement to the underpaid employees. Such transfers are to be implemented by COs on order of the
Secretary or his or her authorized representatives, an Administrative Law Judge, or the Board of Service
Contract Appeals. Considerable attention has been afforded within the DOL's regulations (29 CFR
4.187(b)) as to the priority of withheld funds. These regulations have been developed in light of both
judicial and administrative determinations.
c. The Comptroller General has afforded employee wage claims priority over an Internal Revenue
Service levy for unpaid taxes.
d. Wage claims have priority over re-procurement costs and tax liens without regard to when the
competing claims were raised.
e. Wages due workers underpaid on the contract have priority over any assignee of the contractor,
including assignments made under the Assignment of Claims Act, 31 USC 203, 41 USC 15 to funds
8-4
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