DOL Rule to Update Davis-Bacon

April 1, 2022

On March 18, the U.S. Department of Labor (DOL) announced the publication of a Notice of Proposed Rulemaking as it considers updating the regulations that implement the Davis-Bacon Act and Davis-Bacon and Related Acts to reflect better the needs of workers in the construction industry and planned federal construction investments. The DOL has prepared an initial regulatory flexibility analysis for this rulemaking and seeks feedback on the numbers of small businesses affected and their compliance costs.

The proposed rulemaking by the department’s Wage and Hour Division represents the most comprehensive review of the Davis-Bacon Act regulations in 40 years. According to the announcement the proposal seeks to speed up prevailing wage updates, creating several efficiencies in the current system and ensuring prevailing wage rates keep up with actual wages. Over time, they believe this would mean higher wages for workers.

There are 71 DBRA laws applicable to federal and federally assisted construction projects that require the payment of locally prevailing wage rates for 1.2 million U.S. construction workers. The requirements currently cover approximately $217 billion in federal spending on construction each year.

The proposal updates definitions such as “site of the work” to include sites where prefabricated components are produced, and “scope of work” to include energy infrastructure. These changes may lead to more small firms being required to comply with Davis-Bacon labor standards. The proposal also changes the methodology for determining the prevailing wage. DOL currently uses the average rate if a majority of workers do not receive the same wage rate. Under the proposed rule, if a majority of workers are not paid a particular wage, DOL will identify any wage rate that is paid to more than 30 percent of the workers as prevailing. If there is still no wage prevailing, the agency will revert to an average rate to determine prevailing wage. In addition, DOL will also update non-union prevailing rates every three years to address out-of-date wage determinations.

While the Wage and Hour Division solicits comments from across the construction industry, it also encourages all stakeholders to participate in the process. Comments may be submitted online or commenters may address written submissions to: Division of Regulations, Legislation, and Interpretation, Wage and Hour Division, U.S. Department of Labor, Room S-3502, 200 Constitution Avenue, N.W., Washington, DC 20210. 

Comments are due by May 17, 2022.