Davis-Bacon Act – Contractor and Subcontractor Compliance
Posted on 10.29.2015
Are you familiar with the Davis-Bacon Act?
The Davis-Bacon Act is a federal law that applies to contractors and subcontractors performing work on federal contracts or District of Columbia contracts in excess of $2,000 for the construction, alteration, or repair, including painting and decorating of public buildings or public works. Davis-Bacon Act contractors and subcontractors are required to pay their laborers and mechanics no less than the locally prevailing wages and fringe benefits for corresponding work on similar projects in the area. The Davis-Bacon Act directs the Department of Labor to determine what the locally prevailing wage rates in each area are. These ranges are established by geographic region and my change periodically. Under the Davis-Bacon Act, fringe benefits are a component of these prevailing wages. The Wage Determination obligation of this Act may be satisfied by paying the basic hourly rate and fringe benefits in cash, contributing payments to a bona fide plan or any combination of the two. Examples of fringe benefits can include Life Insurance, Health Insurance, Pension, Vacation, Holiday and Sick Leave. The Department of Labor provides templates for companies to use when reporting their prevailing wages and fringe benefits.
The Davis-Bacon Act requirements also extend to numerous “Related Acts,” under which federal agencies assist construction projects through grants, loans, loan guarantees, and insurance. An example of a “Related Act” would be HUD financed construction on low-income housing projects.
This law encompasses a lot of information so if you have any questions regarding if your company is in compliance with this law, please contact any of our HR Professionals at the Achilles Group.