What is the Walsh-Healey Act and How does it Affect Employers

What is the Walsh-Healy Act and How does it Affect Employers

The Walsh-Healey Public Contracts Act requires contractors engaged in the manufacturing or furnishing of materials, supplies, articles, or equipment government of America or the District of Columbia to pay employees who produce, assemble, handle or ship goods under contracts that exceed $10,000 the federal minimum wage for all the hours worked and time and a half their regular rate of pay for all over time past the 40 hour work week.  This act is enforced by Employment Standards Administration’s Wage and Hour Division within the U.S. Department of Labor.

What is the Walsh-Healy Act and How does it Affect EmployersThis contract applies to all contractors or employers who enter into contracts with the government for the manufacturing or furnishing of materials etc. in excess of $10,000. The act makes prime contractors liable if subcontractors violate the Act.

Although the Act does not apply to employees who are exempt from the minimum wage and overtime requirements under the Fair Labor Standards due to their employment in a bona fide executive, administrative, professional or outside salespersons capacity, a contractor must still pay these employees an overtime rate for all time worked over a 12 hour work day and/or 56 hour work week. If and when an employer fails to do so, they must pay the exempt employee an overtime rate for ALL hours over 40 in a given work week.

When employers/contractors violate the Act, they’re subject to such severe penalties as being debarred from future government contracts for at least three years (worst case scenario).

Contractors subject to the Act must keep the following records for three years:

1) Name, sex, address and occupation of each employee under the Act

2) Birthdates of all employees under 19 years old

3) Wage and hour records of every employee

These records must be kept for two years:

1) Basic employment and earnings records

2)Wage and rate tables

3)Work time schedules



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