August 2023 Final Rule

On Aug. 8, 2023 the U.S. Department of Labor released a final rule, Updating the Davis-Bacon and Related Act Regulations, which makes drastic revisions to the Davis-Bacon Act and Related Acts regulations that apply to federal and federally assisted construction projects funded by taxpayers.

The DOL’s final rule mostly disregards the feedback of ABC contractors, construction industry stakeholders and thousands of small businesses urging the withdrawal of this unnecessary, costly and burdensome regulation.

Instead, the DOL is moving forward with dramatic changes to prevailing wage regulations, reversing much-needed reforms that were established by the Reagan administration, and unlawfully increasing the regulatory burden on small businesses, new industries and public works projects. 

Key changes in the final rule include:

  • Lowering the definition of “prevailing wage” to a wage paid to at least 30% of workers in a locality, down from 50%
  • Allowing the DOL to adopt state or local prevailing wage rates as DBA wage rates
  • Making DBA requirements effective by “operation of law,” meaning even if a federal agency fails to include DBA clauses in a contract, contractors are still required to pay prevailing wages
  • Adds new anti-retaliation provisions to DBA contracts

The final rule was published in the Federal Register on Aug. 23, 2023, and will take effect on Oct. 23, 2023. Therefore, contracts entered into after this date will be impacted, and the DOL will be implementing the final rule’s changes to the wage determination process to WDs completed after the effective date.

ABC offered a members-only webinar on the final rule on Aug. 21, , 2023, and will continue to provide additional resources to assist contractors in complying with these new regulations.

On Nov. 7, 2023 ABC filed a lawsuit in the U.S. District Court for the Eastern District of Texas challenging the DOL’s inflationary and controversial final rule. Expect additional updates on the litigation in this space.

In a separate lawsuit by the Associated General Contractors of America, on June 24, 2024 U.S. District Court for the Northern District of Texas granting a nationwide preliminary injunction that blocks some provisions of the final rule. These provisions include those expanding coverage to include manufacturing facilities miles away from projects and delivery truck drivers spending any amount of time on a jobsite, as well as the imposition of the rule on already-executed contracts, among other things.

The 1931 Davis-Bacon Act and related regulations require contractors and subcontractors that perform work on federal and federally funded construction projects to pay a government-determined prevailing wage and benefit rate on an hourly basis to on-site construction workers. According to the DOL rulemaking, the Davis-Bacon Act and 71 active Related Acts collectively apply to an estimated $217 billion in federal and federally assisted construction spending per year—about 63% of all government construction put in place—and provide government-determined wage rates for an estimated 1.2 million U.S. construction workers. The Biden administration and Congress have recently expanded the application of Davis-Bacon Act prevail wage and benefit requirements onto hundreds of billions of dollars worth of private clean energy and microchip manufacturing projects.

Final Rule Resources:

Proposed Rule Resources

Inflation Reduction Act, CHIPS Act and Davis-Bacon Related Acts Resources

Additional Davis-Bacon Information:


Access ABC’s state prevailing wage law research database (Updated June 1, 2021) 
 State Prevailing Wage Law Research Database

 


DAVIS-BACON ACT COMPLIANCE INFORMATION

Visit the U.S. Department of Labor’s Wage and Hour Division website on Davis-Bacon and Related Acts  for guidance, fact sheets, e-tools, posters, forms, guidance and additional resources.

 

The DOL’s Final Rule: Updating the Davis-Bacon and Related Acts Regulations page provides compliance information including FAQs and a comparison chart on the August 2023 final rule.

 

The Prevailing Wage Resource Book  updated on April 1, 2024 to reflect changes implemented by the August 2023 final rule, was developed by the U.S. Department of Labor Wage and Hour Division as a training tool for use in prevailing wage conferences.

 

The U.S. Department of Labor Wage and Hour Division’s Field Operations Handbook includes a chapter with helpful language on  the Davis-Bacon Act and Related Acts, the Contract Work Hours and Safety Standards Act .

 

The DOL provides Prevailing Wage Seminars to provide training on the Davis-Bacon Act and other prevailing wage requirements.

 

The DOL’s Labor Advisors list provides contacts at each federal agency responsible for implementation and compliance with labor law requirements for federal contractors, including Davis-Bacon regulations.

 

Wage Determinations

Visit Sam.gov, the government website where contractors can obtain government-determined prevailing wage determination (WDs) for contracts subject to the Davis-Bacon Act.

 

The DOL’s Sept. 2021 Conformance Request Guide provides information on requesting conformances where wage determinations do not contain an appropriate labor classification.

 

Wage Surveys

The DOL’s Construction Survey Status page status of upcoming Davis-Bacon wage surveys, providing opportunities for contractors to participate in the wage determination process.

 

The electronic WD-10 form can be used to participate in relevant surveys.

 

The Branch of Construction Wage Determinations provides contact information for the DOL staff responsible for wage determinations in different regions.

 

The federal Davis-Bacon and Related Acts govern wage requirements for contractors and subcontractors performing federally funded or assisted contracts in excess of $2,000. Administered through an unscientific and fundamentally flawed survey process by the U.S. Department of Labor (DOL), these so-called “prevailing” wages hinder economic growth, increase the federal deficit, and impose enormous burdens. Davis-Bacon stifles contractor productivity by raising project costs, and imposes rigid craft work rules that ignore skill differences.

ABC supports full repeal of the Davis-Bacon Act, as well as any state and local prevailing wage laws that mandate wage and benefit rates that do not reflect the current construction market. In the absence of full repeal, ABC also continues to support legislative and regulatory efforts designed to mitigate the Act’s negative effects. ABC opposes expansion of Davis-Bacon into areas of public and private projects in which it has not been previously mandated.

For a summary of studies on the impact of prevailing wage, click here.


    DOL Releases Updated Prevailing Wage Resource Book

    On April 1, the U.S. Department of Labor issued an updated version of its Prevailing Wage Resource Book. The resource provides an overview of prevailing wage requirements under the Davis-Bacon and Related Acts and Service Contract Act. The updated guide incorporates changes to Davis-Bacon regulations that came into effect on Oct. 23, 2023, under the August 2023 final rule.

    The final rule made drastic revisions to the Davis-Bacon Act and Related Acts regulations that apply to federal and federally assisted construction projects funded by taxpayers. These regulations require contractors on covered projects to pay prevailing wages determined by the DOL’s survey process. Unfortunately, the rule reversed important reforms that were established by the Reagan administration and increased the inaccuracy of Davis-Bacon wage determinations.

    On Nov. 7, 2023, ABC filed a lawsuit in the U.S. District Court for the Eastern District of Texas challenging the final rule, asserting that it violates numerous federal statutes and violates principles of fair and open competition on federal and federally assisted construction projects. Further updates will be provided in Newsline as the case proceeds.

    ABC offered a members-only webinar on the final rule on Aug. 21, 2023. More information and resources are available on ABC’s website at abc.org/davisbacon.


    DOL Releases Updated Prevailing Wage Resource Book

    On April 1, the U.S. Department of Labor issued an updated version of its Prevailing Wage Resource Book. The resource provides an overview of prevailing wage requirements under the Davis-Bacon and Related Acts and Service Contract Act. The updated guide incorporates changes to Davis-Bacon regulations that came into effect on Oct. 23, 2023, under the August 2023 final rule.

    The final rule made drastic revisions to the Davis-Bacon Act and Related Acts regulations that apply to federal and federally assisted construction projects funded by taxpayers. These regulations require contractors on covered projects to pay prevailing wages determined by the DOL’s survey process. Unfortunately, the rule reversed important reforms that were established by the Reagan administration and increased the inaccuracy of Davis-Bacon wage determinations.

    On Nov. 7, 2023, ABC filed a lawsuit in the U.S. District Court for the Eastern District of Texas challenging the final rule, asserting that it violates numerous federal statutes and violates principles of fair and open competition on federal and federally assisted construction projects. Further updates will be provided in Newsline as the case proceeds.

    ABC offered a members-only webinar on the final rule on Aug. 21, 2023. More information and resources are available on ABC’s website at abc.org/davisbacon.


    January 2024: DOL Announces Virtual Seminars on Prevailing Wage Compliance

    The U.S. Department of Labor’s Wage and Hour Division recently announced a series of virtual compliance seminars to provide information on prevailing wage requirements for federally funded construction and service contracts. Each seminar will offer separate sessions focused on Davis-Bacon Act and Service Contract Act compliance.

    Seminars will take place on the following dates:

    • Feb. 27
    • May 15
    • Aug. 29

    Registration via the DOL’s website is required to attend the seminars.


    January 2024: DOL Announces Virtual Seminars on Prevailing Wage Compliance

    The U.S. Department of Labor’s Wage and Hour Division recently announced a series of virtual compliance seminars to provide information on prevailing wage requirements for federally funded construction and service contracts. Each seminar will offer separate sessions focused on Davis-Bacon Act and Service Contract Act compliance.

    Seminars will take place on the following dates:

    • Feb. 27
    • May 15
    • Aug. 29

    Registration via the DOL’s website is required to attend the seminars.


    US House Introduces Resolution Opposing DOL’s New Davis-Bacon Rule

    On Nov. 15, Rep. Lloyd Smucker, R-Pa., introduced a resolution (H.J. Res.103) under the Congressional Review Act providing for congressional disapproval of the U.S. Department of Labor’s final rule, Updating Davis-Bacon and Related Acts Regulations. This controversial final rule largely disregards the feedback of ABC, construction industry stakeholders and thousands of small businesses urging the withdrawal of––and/or improvements to––this unnecessary, costly and burdensome regulation.

    Smucker’s Nov. 20 press release promoting the CRA highlights opposition from lawmakers, taxpayer watchdogs and dozens of construction industry groups to the Biden administration’s final rule, which makes radical revisions to regulations implementing the Davis-Bacon Act and Related Acts that apply to federal and federally assisted construction projects funded by taxpayers and procured by government and private owners.

    “The Wage and Hour Division’s Davis-Bacon rule is a complete giveaway to union bosses,” said Education and the Workforce Committee Chairwoman Virginia Foxx, R-N.C. “This rule dims America’s infrastructure outlook by increasing costs for federal construction projects and imposing a massive financial burden on taxpayers. I commend Rep. Smucker for leading a CRA resolution to block this harmful rule and the Biden administration’s bureaucratic overreach.”

    An ABC-led construction industry coalition letter expressed support for Rep. Smucker’s CRA, because “onerous new requirements and artificial inflation of construction costs imposed by this new Davis-Bacon Act rule will only exacerbate [economic headwinds facing the construction industry] and undermine taxpayer investments in much-needed infrastructure.”

    Instead, the DOL is moving forward with dramatic changes to Davis-Bacon Act regulations, reversing much-needed reforms that were established by the Reagan administration and unlawfully increasing the regulatory burden on small businesses, new industries and critical public works projects. 

    The final rule was published in the Federal Register on Aug. 23, 2023, and became effective on Oct. 23, 2023. Therefore, construction contracts executed after this date are subject to the new rule. In addition, the DOL will begin implementing the final rule’s ill-advised changes to its broken and convoluted wage determination process that are likely to make government-determined wages inaccurate and less reflective of a local prevailing wage.

    On Nov. 7, ABC and the ABC Southeast Texas chapter filed a lawsuit in the U.S. District Court for the Eastern District of Texas challenging numerous aspects of the DOL’s inflationary and anti-competitive final rule.

    As outlined in ABC’s Aug. 31 op-ed published in The Hill opposing the Biden DOL rule, litigation appears to be the best short-term strategy to defeat or delay some or all aspects of the rule until a pro-free enterprise White House can reverse this policy.

    Unfortunately, a Sept. 6 letter to Acting DOL Secretary Julie Su signed by 13 House Republicans expressed support for the DOL’s new regulation.

    ABC has issued a targeted grassroots alert asking ABC members to contact lawmakers in support of Rep. Smucker’s CRA and in opposition to the DOL’s final rule as it is unclear if lawmakers understand the radical changes in the final rule.

    The CRA requires agencies to report the issuance of “rules” to Congress and provides Congress with special procedures, in the form of a joint resolution of disapproval, under which to consider legislation to overturn rules. If a CRA joint resolution of disapproval is approved by both houses of Congress and signed by the president, or if Congress successfully overrides a presidential veto, the rule at issue cannot go into effect or continue in effect. Rep. Smucker’s CRA is not likely to succeed in the current Congress.

    Background on the Davis-Bacon Act

    The 1931 Davis-Bacon Act and related regulations require contractors and subcontractors that perform work on federal and federally funded construction projects to pay a government-determined prevailing wage and benefit rate on an hourly basis to on-site construction workers.

    According to the DOL rulemaking, the Davis-Bacon Act and 71 active Related Acts collectively apply to an estimated $217 billion in federal and federally assisted construction spending per year—about 63% of all government construction put in place—and provide government-determined wage rates for an estimated 1.2 million U.S. construction workers.

    The Biden administration and Congress have recently expanded the application of Davis-Bacon Act prevail wage and benefit requirements onto hundreds of billions of dollars’ worth of private sector clean energy and microchip manufacturing projects that have never been covered by Davis-Bacon regulations. In addition, the rule is expected to inflate costs on hundreds of billions of dollars of new government-financed infrastructure projects funded in part by the Infrastructure Investment and Jobs Act.

    Learn more at abc.org/davisbacon.


    US House Introduces Resolution Opposing DOL’s New Davis-Bacon Rule

    On Nov. 15, Rep. Lloyd Smucker, R-Pa., introduced a resolution (H.J. Res.103) under the Congressional Review Act providing for congressional disapproval of the U.S. Department of Labor’s final rule, Updating Davis-Bacon and Related Acts Regulations. This controversial final rule largely disregards the feedback of ABC, construction industry stakeholders and thousands of small businesses urging the withdrawal of––and/or improvements to––this unnecessary, costly and burdensome regulation.

    Smucker’s Nov. 20 press release promoting the CRA highlights opposition from lawmakers, taxpayer watchdogs and dozens of construction industry groups to the Biden administration’s final rule, which makes radical revisions to regulations implementing the Davis-Bacon Act and Related Acts that apply to federal and federally assisted construction projects funded by taxpayers and procured by government and private owners.

    “The Wage and Hour Division’s Davis-Bacon rule is a complete giveaway to union bosses,” said Education and the Workforce Committee Chairwoman Virginia Foxx, R-N.C. “This rule dims America’s infrastructure outlook by increasing costs for federal construction projects and imposing a massive financial burden on taxpayers. I commend Rep. Smucker for leading a CRA resolution to block this harmful rule and the Biden administration’s bureaucratic overreach.”

    An ABC-led construction industry coalition letter expressed support for Rep. Smucker’s CRA, because “onerous new requirements and artificial inflation of construction costs imposed by this new Davis-Bacon Act rule will only exacerbate [economic headwinds facing the construction industry] and undermine taxpayer investments in much-needed infrastructure.”

    Instead, the DOL is moving forward with dramatic changes to Davis-Bacon Act regulations, reversing much-needed reforms that were established by the Reagan administration and unlawfully increasing the regulatory burden on small businesses, new industries and critical public works projects. 

    The final rule was published in the Federal Register on Aug. 23, 2023, and became effective on Oct. 23, 2023. Therefore, construction contracts executed after this date are subject to the new rule. In addition, the DOL will begin implementing the final rule’s ill-advised changes to its broken and convoluted wage determination process that are likely to make government-determined wages inaccurate and less reflective of a local prevailing wage.

    On Nov. 7, ABC and the ABC Southeast Texas chapter filed a lawsuit in the U.S. District Court for the Eastern District of Texas challenging numerous aspects of the DOL’s inflationary and anti-competitive final rule.

    As outlined in ABC’s Aug. 31 op-ed published in The Hill opposing the Biden DOL rule, litigation appears to be the best short-term strategy to defeat or delay some or all aspects of the rule until a pro-free enterprise White House can reverse this policy.

    Unfortunately, a Sept. 6 letter to Acting DOL Secretary Julie Su signed by 13 House Republicans expressed support for the DOL’s new regulation.

    ABC has issued a targeted grassroots alert asking ABC members to contact lawmakers in support of Rep. Smucker’s CRA and in opposition to the DOL’s final rule as it is unclear if lawmakers understand the radical changes in the final rule.

    The CRA requires agencies to report the issuance of “rules” to Congress and provides Congress with special procedures, in the form of a joint resolution of disapproval, under which to consider legislation to overturn rules. If a CRA joint resolution of disapproval is approved by both houses of Congress and signed by the president, or if Congress successfully overrides a presidential veto, the rule at issue cannot go into effect or continue in effect. Rep. Smucker’s CRA is not likely to succeed in the current Congress.

    Background on the Davis-Bacon Act

    The 1931 Davis-Bacon Act and related regulations require contractors and subcontractors that perform work on federal and federally funded construction projects to pay a government-determined prevailing wage and benefit rate on an hourly basis to on-site construction workers.

    According to the DOL rulemaking, the Davis-Bacon Act and 71 active Related Acts collectively apply to an estimated $217 billion in federal and federally assisted construction spending per year—about 63% of all government construction put in place—and provide government-determined wage rates for an estimated 1.2 million U.S. construction workers.

    The Biden administration and Congress have recently expanded the application of Davis-Bacon Act prevail wage and benefit requirements onto hundreds of billions of dollars’ worth of private sector clean energy and microchip manufacturing projects that have never been covered by Davis-Bacon regulations. In addition, the rule is expected to inflate costs on hundreds of billions of dollars of new government-financed infrastructure projects funded in part by the Infrastructure Investment and Jobs Act.

    Learn more at abc.org/davisbacon.


    Changes to Davis-Bacon Prevailing Wage Regulations Now in Effect

    On Oct. 23, the U.S. Department of Labor’s final rule, Updating the Davis-Bacon and Related Acts Regulations, officially took effect. The regulation imposes drastic revisions to previous rules regarding government-determined prevailing wage rates that must be paid to construction workers on federal and federally assisted construction projects funded by taxpayers.

    ABC issued a statement opposing the new rule, stating:

    “This is yet another Biden administration handout to organized labor on the backs of taxpayers, small businesses and the free market,” said ABC Vice President of Regulatory, Labor and State Affairs Ben Brubeck. “Unfortunately, the DOL’s final rule disregards the feedback of ABC contractors, construction industry stakeholders and thousands of small businesses urging the withdrawal of this unnecessary, costly and burdensome regulation.” 

    All contracts entered into after Oct. 23 will be subject to the new rule’s provisions. Additionally, in certain situations the rule may apply to existing contracts. This includes if a contract is changed to cover substantial Davis-Bacon-covered work not within the scope of the original contract, if an option to extend a contract’s term is exercised, and for ongoing contracts not tied to completion of a particular project.

    For more information on the final rule, see ABC’s previous Newsline article, ABC general counsel Littler Mendelson’s analysis, the DOL’s compliance resources and ABC’s online resources at abc.org/davisbacon. ABC also held a members-only webinar on the final rule on Aug. 21, and the recording is now available on the ABC Academy.

    For any questions regarding the final rule, please contact Michael Altman at [email protected].


    Changes to Davis-Bacon Prevailing Wage Regulations Now in Effect

    On Oct. 23, the U.S. Department of Labor’s final rule, Updating the Davis-Bacon and Related Acts Regulations, officially took effect. The regulation imposes drastic revisions to previous rules regarding government-determined prevailing wage rates that must be paid to construction workers on federal and federally assisted construction projects funded by taxpayers.

    ABC issued a statement opposing the new rule, stating:

    “This is yet another Biden administration handout to organized labor on the backs of taxpayers, small businesses and the free market,” said ABC Vice President of Regulatory, Labor and State Affairs Ben Brubeck. “Unfortunately, the DOL’s final rule disregards the feedback of ABC contractors, construction industry stakeholders and thousands of small businesses urging the withdrawal of this unnecessary, costly and burdensome regulation.” 

    All contracts entered into after Oct. 23 will be subject to the new rule’s provisions. Additionally, in certain situations the rule may apply to existing contracts. This includes if a contract is changed to cover substantial Davis-Bacon-covered work not within the scope of the original contract, if an option to extend a contract’s term is exercised, and for ongoing contracts not tied to completion of a particular project.

    For more information on the final rule, see ABC’s previous Newsline article, ABC general counsel Littler Mendelson’s analysis, the DOL’s compliance resources and ABC’s online resources at abc.org/davisbacon. ABC also held a members-only webinar on the final rule on Aug. 21, and the recording is now available on the ABC Academy.

    For any questions regarding the final rule, please contact Michael Altman at [email protected].


    Survey: 98% of ABC Contractors Concerned Inflation Reduction Act Limits Competition—Submit Comments by Oct. 30

    A survey of ABC contractor members conducted in October 2023 showed that 98% of respondents said controversial prevailing wage and government-registered apprenticeship policies imposed by the Inflation Reduction Act will make them less likely to bid on clean energy projects. The survey gauged ABC members’ responses to a proposed rule issued by the Internal Revenue Service on Aug. 29 that would implement these requirements.

    ABC issued a press release on the survey results, stating:

    “The concerns expressed by the overwhelming majority of respondents indicate that the proposed rule fails to provide much-needed regulatory certainty and will ultimately cause unnecessary cost increases and delays to America’s clean energy projects,” said ABC Vice President of Regulatory, Labor and State Affairs Ben Brubeck. “Stakeholders seeking enhanced IRA tax incentives conditioned on meeting controversial prevailing wage and government-registered apprenticeship programs are sending a clear message that more clarity is required for the IRA to deliver on promised benefits.”

    ABC will be submitting comments to the IRS by Oct. 30 in response to the proposed rule and is ready to assist members interested in submitting comments by providing a customizable template. ABC members can reach out to Michael Altman at [email protected] to receive the template.

    The Inflation Reduction Act was signed into law on Aug. 16, 2022, and provides over $270 billion in tax incentives for the construction of solar, wind, hydrogen, carbon sequestration, electric vehicle charging stations and other clean energy projects.

    However, this is conditioned on requirements that project contractors meet prevailing wage and apprenticeship requirements. Developers/taxpayers must ensure that contractors pay all construction workers prevailing wages and benefits set by the U.S. Department of Labor via the Davis-Bacon Act. Developers must also ensure that contractors utilize apprentices enrolled in government-registered apprenticeship programs for certain percentages of all construction hours worked on a project (12.5% of all work hours in 2023 and 15% of all work hours in 2024 and thereafter), among other requirements.

    For more information on the proposed rule and other IRA requirements, visit abc.org/ira.


    Survey: 98% of ABC Contractors Concerned Inflation Reduction Act Limits Competition—Submit Comments by Oct. 30

    A survey of ABC contractor members conducted in October 2023 showed that 98% of respondents said controversial prevailing wage and government-registered apprenticeship policies imposed by the Inflation Reduction Act will make them less likely to bid on clean energy projects. The survey gauged ABC members’ responses to a proposed rule issued by the Internal Revenue Service on Aug. 29 that would implement these requirements.

    ABC issued a press release on the survey results, stating:

    “The concerns expressed by the overwhelming majority of respondents indicate that the proposed rule fails to provide much-needed regulatory certainty and will ultimately cause unnecessary cost increases and delays to America’s clean energy projects,” said ABC Vice President of Regulatory, Labor and State Affairs Ben Brubeck. “Stakeholders seeking enhanced IRA tax incentives conditioned on meeting controversial prevailing wage and government-registered apprenticeship programs are sending a clear message that more clarity is required for the IRA to deliver on promised benefits.”

    ABC will be submitting comments to the IRS by Oct. 30 in response to the proposed rule and is ready to assist members interested in submitting comments by providing a customizable template. ABC members can reach out to Michael Altman at [email protected] to receive the template.

    The Inflation Reduction Act was signed into law on Aug. 16, 2022, and provides over $270 billion in tax incentives for the construction of solar, wind, hydrogen, carbon sequestration, electric vehicle charging stations and other clean energy projects.

    However, this is conditioned on requirements that project contractors meet prevailing wage and apprenticeship requirements. Developers/taxpayers must ensure that contractors pay all construction workers prevailing wages and benefits set by the U.S. Department of Labor via the Davis-Bacon Act. Developers must also ensure that contractors utilize apprentices enrolled in government-registered apprenticeship programs for certain percentages of all construction hours worked on a project (12.5% of all work hours in 2023 and 15% of all work hours in 2024 and thereafter), among other requirements.

    For more information on the proposed rule and other IRA requirements, visit abc.org/ira.

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