The Department of Labor has issued new Service Contract Act (SCA) health and welfare (H&W) rates. Effective July 7, 2025, the prevailing H&W fringe benefits rise from a rate of $5.36 per hour to $5.55 per hour. If a contractor is obligated to comply with Executive Order (EO) 13706 sick leave requirements, the rates increase from $4.93 per hour to $5.09 per hour.

Pending procurements/awards will probably be modified to comply. For existing SCA contracts, you will not normally need to worry about this until it is added to your contract when the Option Year is exercised.

If FAR52.222-43 is included in your contract, it entitles you claim a price adjustment for the difference between what you currently pay employees and what you will have to pay employees once the new wage determination becomes a part of your contract.

For details on this topic: Department of Labor - Introduction To SF98

For more insights on maintaining compliance under the Service Contract Act, visit WrkPlan’s guide: How to Stay Compliant with the SCA.