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Applicability of the Davis-Bacon Prevailing Wage Requirements

Appendix II of the Uniform Guidance lists terms and conditions that are required in certain contracts that are funded with federal grants.  Prevailing wage requirements under the Davis-Bacon Act, 40 U.S.C. §§ 3141-3148, as supplemented by U.S. Department of Labor (DOL) regulations at 29 C.F.R. Part 5, are among those terms and conditions.

Davis-Bacon requirements must be included in federally-funded construction contracts in excess of $2,000 when required by the Federal program’s legislation.  If neither the legislation that authorized the program or appropriate funds for it invokes Davis-Bacon, then federal prevailing wage requirements do not apply.  Still, grantees are encouraged to verify whether State or local prevailing wage laws and other labor standards apply to their federally-funded construction projects. Although application can sometimes be difficult to ascertain, it is not uncommon for Notices of Funding Availability (NOFAs) for particular programs to indicate when Davis-Bacon requirements apply.

Grantees must include in contracts subject to Davis-Bacon a requirement that contractor pay wages to laborers and mechanics at a rate no less than the prevailing wages as determined by the U.S. Secretary of Labor. Grantees are required to place a copy of the current prevailing wage determination in each solicitation for construction or renovation services.  Davis-Bacon requirements extend to lower-tier subcontractors as the decision to award a contract or subcontract must be conditioned upon the acceptance of the wage determination.  Contractors must pay wages no less than once a week.  See 2 C.F.R. Part 200, App. II, §(D).

DOL regulations at 29 C.F.R. § 5.5(a)(5) provide that, if a contract is subject to Davis-Bacon, then it is also subject to the Copeland “Anti-Kickback” Act, 40 U.S.C. § 3145, which prohibits inducing any person employed in construction, completion, or repairs to give up any part of the compensation to which they are entitled.

Moreover, regulations at 29 C.F.R. § 5.5(b) provide that contracts subject to Davis-Bacon in excess of $100,000 are also subject to the Contract Work Hours and Safety Standards Act, 40 U.S.C. §§ 3702 and 3704, which requires payment of overtime for all hours worked in excess of 40 per week and prohibits requiring laborers or mechanics to work in surroundings or under working conditions that are unsanitary, hazardous or dangerous.

Helpfully, DOL regulations at 29 C.F.R. Part 5 provide specific language for clauses to be included in contracts to effectuate each requirement.