Continuing with the White House’s push to revamp the employment landscape, the Department of Labor’s (“DOL”) proposed regulations for federally funded construction projects will return to the definition of “prevailing wage” that was last used in 1983.  The agency’s proposed changes to the regulations that implement the Davis-Bacon Act are intended to speed up prevailing wage updates and will increase wages for construction workers over time.

The Davis-Bacon Act sets a floor for construction workers’ wages on public works projects and requires federal contractors and subcontractors to pay construction workers the same prevailing wages and benefits depending on the location.  Prevailing wages in different locations vary based on the area’s cost of living.  The wage is calculated through surveys of the area. 

Under the current regulations, if a majority of the workers in the area are not paid the same rate, the determination of the prevailing wage uses a “weighted average” method.  This requires a survey of the prevailing wages paid to workers of a particular classification in a majority (greater than 50%) of the areas.  Total wages are divided by the number of workers in a particular classification to determine an average wage.  Under the proposed regulation, returning to a standard that had been used from 1935 to 1983, only 30% of the wages paid to workers in a particular classification in a particular area must be surveyed.  

The proposed rule contains other provisions that is meant to keep prevailing wages on pace with actual wages, grants broad authority to adopt state or local wage determinations in certain circumstances, and allows for supplemental rates if no survey data exists for a key job classification.  It also contains an anti-retaliation provision to protect workers who raise complaints.

The DOL issued its proposed rule more than a year ago and received more than 40,000 comments during a public comment period.  The new rule will go into effect 60 days after publication in the Federal Register and a court challenge is likely.