Prevailing Minimum Wage (Davis-Bacon Act)

General
The payment of predetermined minimum wages for certain job classifications used on federal-aid contracts is derived from the
Davis-Bacon Act of 1931
(40 U.S.C. §3141 et seq.) and is prescribed by
23 U.S.C. §113
. The Davis-Bacon Act requires the payment of locally prevailing wages and fringe benefits to laborers and mechanics employed on federal contracts in excess of $2,000 for construction, alteration or repair (including painting and decorating) of public buildings or public works. Davis-Bacon was enacted as a means to prevent contractors from importing cheap labor from outside the area; thereby, keeping capital at home with the local labor force where it would do the most good. Davis-Bacon provisions are covered in
Form FHWA-1273
. The procedures that must be followed to comply with the Davis-Bacon provisions are described in the
LGPM Guide
.
Applicability of Davis-Bacon - Site of Work
The Davis-Bacon Act limits coverage to laborers and mechanics “employed directly upon the site of the work.” Since 1972, the U.S. Department of Labor (USDOL) and the courts have been addressing various aspects of the applicability of Davis-Bacon requirements to site-of-work facilities.
USDOL’s implementing regulation,
29 CFR §5.2(l)(2)
, extends coverage to off-site facilities dedicated exclusively and in proximity to the actual construction site.
29 CFR §5.2 (l)(1) states:
“The site of the work is the physical place or places where the building or work called for in the contract will remain; and any other site where a significant portion of the building or work is constructed, provided that such site is established specifically for the performance of the contract or project …”
The
LGPM Guide
provides examples and additional guidance on the applicability of Davis-Bacon Act to the site of work. USDOL has made the determination that when transportation will take place in more than one wage determination area, the applicable wage determination will be the wage determination for the area in which the construction will remain when completed. This determination will apply to all bidders, regardless of where they propose to construct significant portions of the project.
FHWA has taken the position that since this is the USDOL’s program, it is inappropriate for FHWA to provide guidance in this area. FHWA encourages LGs to work jointly with TxDOT, the FHWA division office and the DOL regional offices to resolve “site of work” issues.
Applicability of Davis-Bacon to Specific Work Types
The
LGPM Guide
provides a detailed discussion of the applicability of the Davis-Bacon Act to specific work types. Additional discussion on specific work types can be found in the
DOL’s Field Operations Handbook
.
Federal Requirement
  1. 23 U.S.C. §113
    – Requires laborers and mechanics to be paid wages at rates not less than those prevailing on the same type of work on similar construction in the immediate locality as determined by the Secretary of Labor. This provision applies to all projects with federal funds on roadways functionally classified above a rural minor collector.
  2. 40 U.S.C. §3141et seq.
    – Davis-Bacon Act of 1931
  3. 18 U.S.C. §874
    (Copeland Act) – Protects workers from paying “kickbacks” to employers for the “privilege” of being employed.
  4. 23 CFR §633.102
    – Requires
    Form FHWA-1273
    to be included in all construction contracts that have federal funds.
  5. 23 CFR §635.309(f)
    – Provides that minimum wage rates determined by the USDOL in accordance with the provisions of
    23 U.S.C. §113
    are in effect and will not expire before the end of the period within which it can reasonably be expected the contract will be awarded.
  6. 23 CFR §636.119
    – Requires projects developed under a public-private partnership to comply with all non-procurement provisions of
    Title 23 U.S.C.
  7. 29 CFR Parts
    1
    ,
    2
    and
    5
    – Provides procedures for predetermination of wage rates, Copeland Act and enforcement provisions.
State Requirement
  1. Texas Government Code §2258.021
    – Requires a worker employed on a public work by or on behalf of the state or a political subdivision of the state shall be paid:
    1. not less than the general prevailing rate of per diem wages for work of a similar character in the locality in which the work is performed; and
    2. not less than the general prevailing rate of per diem wages for legal holiday and overtime work.
  2. Texas Government Code §2258.022(a)
    – Requires the public body to determine the general prevailing rate of per diem wages in the locality in which the public work is to be performed for each craft or type of worker needed to execute the contract and the prevailing rate for legal holiday and overtime work.
  3. Texas Government Code §2258.023
    – Provides for penalties assessed a contractor or subcontractor who violates the statute.
  4. Texas Government Code §2258.024
    – Specifies records to be maintained by the contractor and subcontractor.
  5. Texas Government Code Chapter 2258, Subchapter C
    – Describes enforcement actions for violations of the statute.
Required Practices
The LG must use accepted wage rates (approved by TxDOT) complying with the provisions of the Davis-Bacon Act. The
LGPM Guide
provides the required practices and responsibilities of the LG and TxDOT for compliance with the Act.