DBA - Davis-Bacon Act
Purpose of the DBA
To protect communities and workers from the economic disruption caused by competition arising from non-local contractors coming into an area and obtaining federal construction contracts by underbidding local wage levels.
Requirements of the Act
The Davis-Bacon Act sets strict rules for wages and benefits of laborers and mechanics working on federal construction contracts for amounts in excess of $2,000.
It specifically requires the payment of locally prevailing wages and fringe benefits to laborers and mechanics employed on federal government contracts to which the United States or District of Columbia is a party to in excess of $2,000 for construction, alteration, or repair which includes painting and decorating of public buildings or public works.
Prevailing wages are determined in advance by the Department of Labor and must be included in the bid specifications for covered contracts.
DBA prevailing wage requirements also apply to a wide variety of state and local projects that are funded using federal grants or loan guarantees, such as highways, airports, Government-funded housing and water treatment facilities.
Examples:
- General Services Administration contracts to build federal office buildings.
- Department of Defense contracts to build military housing.
The U.S. Department of Labor has primary authority to implement the DBA, such as setting prevailing wage rates ("wage determinations") and developing policy.
The DBA requires contractors and subcontractors to pay "all mechanics and laborers employed directly on the site of the work, unconditionally and not less often than once a week, and without subsequent reduction or debate on any account, the full amount accrued at the time of payment, computed at wage rates not less than those stated in the advertised specifications, regardless of any contractual obligation which may be alleged to exist between the contractor or subcontractor and such laborers and mechanics.
Important points to note:
- The DBA's requirements apply to both contractors and subcontractors.
- It requires that laborers or mechanics be paid at the minimum prevailing wage.
- Laborers and mechanics must be paid on a weekly basis.
- It only applies to employment on the site of work.
- Persons performing the duties of laborers and mechanics must be paid the prevailing wage rate regardless of any contractual arrangement, e.g. an independent contractor or owner operator relationship.
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