Service Contract Act Fringe Rate Increases for 2022

The Department of Labor Wage and Hour Division (WHD) increased Health & Welfare (H&W) rates on wage determinations effective June 23, 2022. The new fringe rate is in effect for a particular contract only after the contracting officer incorporates the new fringe rate into that specific contract. The contracting officer should incorporate the new fringe rate that is applicable on the anniversary date of a multiple-year contract or at the beginning of the next contract option period after June 23, 2022.

The new fringe rates are:

• $4.80 per hour
• $4.41 per hour for contracts requiring sick leave under EO 13706
• $2.04 per hour for Hawaii Prepaid Healthcare Act (HPHCA) employees
• $1.65 per hour for Hawaii Prepaid Healthcare Act (HPHCA) employees for contracts requiring sick leave under EO 13706 contracts.

The less than five percent increase in the fringe rate for 2022 is in line with recent increases. The totals in aggregate fringe increases in almost five years is less than five percent. The 2022 fringe rate increase is a step in the right direction, but still less than the current rate of inflation.

There are techniques which can be applied to give federal government contractors the competitive advantage and our AssuredPartners Government Contractor Solutions team is there to help you craft a solution. Contact the AssuredPartners Government Contracting team today so we can help you plan for changes to the fringe benefit and offer compliant insurance solutions while working under government contracts.