The U.S. Department of Labor (DOL) will offer online compliance seminars in September for contracting agencies, contractors, unions, workers and other stakeholders to provide information on recent updates to regulations governing employment practices for federally funded contracts.
On Aug. 8, 2023, the labor department’s Wage and Hour Division provided for public review the final rule, “Updating the Davis-Bacon and Related Acts Regulations,” following the first comprehensive review of these regulations in nearly 40 years.
Enacted in 1931, the DBRA requires that laborers and mechanics be paid prevailing wages and fringe benefits when they’re employed on federally funded contracts worth more than $2,000 for the construction, alteration or repair of public buildings and other public works.
“Prevailing wage laws reduce pay discrimination in construction,” said worker advocate Lisa McCormick. “In particular, people of color and other typically underpaid employees who work in the construction trades benefit from prevailing wage laws.”
“The prevailing wage is essentially a minimum wage for construction workers on publicly-funded projects,” said McCormick. “The law ensures that workers employed on infrastructure projects funded by taxpayer dollars are compensated according to local market rates.”
“Today’s final rule on Davis–Bacon and Related Acts will not only strengthen prevailing wage laws, but it also will improve legal protections from wage theft for more than one million workers on federal construction projects,” said AFL-CIO President Liz Shuler.
“This rule will guarantee that workers in new and existing jobs, emerging infrastructure, and clean energy sectors are paid fairly,” said Shuler. “Every job created through these historic investments should be a good family-supporting job. That’s how we rebuild America from the bottom up and middle out.”
A 2018 study by the Illinois Economic Policy Institute and the University of Illinois at Urbana-Champaign found that African Americans working in construction in states with prevailing wage laws are more likely to earn an annual income classified as “middle class.”
On average, African Americans experience a 24 percent increase in annual incomes due to prevailing wages.
The upcoming seminars will provide participants with an overview of recent DBRA changes and offer them an opportunity to ask for more information or to clarify their concerns.
The seminars are part of the division’s ongoing effort to raise awareness of federal prevailing wage requirements among federal contractors and subcontractors and promote compliance.
“Prevailing wage laws ensure that people employed on federally funded construction projects across the nation are paid fair wages and benefits,” explained Principal Deputy Wage and Hour Administrator Jessica Looman. “With the historic investments being made in our nation’s infrastructure, these online Wage and Hour Division seminars will provide employers and others with information about compliance with regulations governing federal contracts.”
The seminars will begin at 1 p.m. EDT on Sept. 13 and 14, 2023.
Updates in the Davis-Bacon and Related Acts final rule include the following:
- Returning to the definition of “prevailing wage” used from 1935 to 1983 to address the overuse of average rates, and ensure they better reflect actual wages paid to workers in local communities.
- Periodically updating certain non-collectively bargained and out-of-date prevailing wage rates.
- Recognizing the division’s broad authority to adopt state or local wage determinations as the federal prevailing wage where certain criteria are satisfied.
- Allowing wage determinations to include supplemental rates for key classifications when insufficient survey data exists to publish prevailing wage rates.
- Modernizing and clarifying the definitions of “building or work” and “site of the work.”
- Ensuring that DBRA labor standards’ requirements protect workers by operation of law.
- Strengthening enforcement, including debarment and new anti-retaliation provisions.
For more information on the Davis-Bacon Act, the Service Contract Act and other federal wage laws related to government contracts administered by the Wage and Hour Division, please call the division’s toll-free helpline at 1-866-4US-WAGE (487-9243).
McCormick said that the changes have been a long time in the making, which she interprets as a weak commitment to workers from the Biden administration.
McCormick has faulted President Joe Biden for insufficient effort toward raising the federal minimum wage, which has remained $7.25 per hour since 2009.
“Minimum wage rates went up in 23 states and 41 cities earlier this year, and this summer, Connecticut, Nevada, Oregon, and Washington D.C. raised their minimum wages, as 15 cities and counties also implemented minimum wage hikes, providing timely relief for low-wage workers facing rising prices,” said McCormick. “Biden said, ‘No one should work 40 hours a week and live in poverty,’ but he never took action on policies that show he is genuinely concerned.”
Raising the minimum wage to $15 would have reduced the number of people in poverty by 900,000 and increased the pay of about 27 million workers, according to a Congressional Budget Office report released in 2021.
“Biden signed an executive order that raised the minimum wage for federal contractors to $15 an hour, but he left behind everyone in a dozen states,” said McCormick. “As of August 2023, seven states—Alabama, Louisiana, Mississippi, South Carolina, Tennessee, Georgia, and Wyoming—use the federal minimum wage while five states—Arizona, Arkansas, Idaho, Indiana, and North Carolina—do not have any minimum wage laws at all, so employers there are required to pay their employees the federal minimum wage of $7.25 per hour.”
DOL issued its notice of proposed rulemaking in March 2022 and received more than 40,000 comments from interested stakeholders.
Evaluating and addressing those comments took the better part of a year, as DOL did not send the rule to the Office of Information and Regulatory Affairs for White House approval until December 16, 2022.
After languishing for months, OIRA has now concluded its review, allowing DOL to move forward with its final rule.