New Davis-Bacon Regulations on New Contracts

Following over a year of public comments and revisions the U.S. Department of Labor (DOL) on August 23, 2023, published the final rule updating regulations under the Davis-Bacon and Related Acts. The Davis-Bacon Act (DBA) requires contractors and subcontractors on most federally funded or assisted construction projects to pay their workers the locally prevailing wages and fringe benefits. 

Beginning in early 2022, following DOL’s initial release of proposed updates to the DBA’s regulations, ARTBA and other industry groups filed individual comments supporting some of the rule’s objectives in principle, while disagreeing with other parts.  VTCA, alongside ARTBA, met with representatives of DOL to discuss several issues with the proposed changes.  Although in general much of the language remains problematic for the transportation construction industry the DOL was responsive to several of the issues discussed. A few of the revisions of the originally proposed language include: 

• DOL proposed redefining the term “area” for highway construction projects. DOL now allows multi-county wage data to be combined and used to calculate the prevailing wage. 
• The initial proposal expanded DBA coverage beyond active project sites. The rule narrows the scope of coverage to locations where a significant portion of work is performed, and where the site is established for the exclusive performance of the covered contract. 
• DOL at first proposed requiring prevailing wages for the time that off-site drivers and materials providers spend on the worksite, even if that time is negligible. This provision was omitted. 
• The final rule clarifies the difference between licensed surveyors that are salaried professionals—and not subject to the DBA—and workers surveying on sites. 

VDOT has released a special provision incorporating the newly updated requirements and Form FHWA-1273 into federally funded VDOT contracts.  The provision will be in VDOT’s federally funded contracts and on-call contracts executed after October 23, 2023.  As of October 13, VDOT has been including the new requirements in advertised project proposals. 

Contractors are encouraged to review the new Davis-Bacon rule including requirements holding the prime contractor liable for subcontractor compliance with the Davis Bacon provisions.  Also, contractors are encouraged to review wage rate determinations for each upcoming project in consideration that some rates may have changed.  Where contracts cross traditional wage decision lines a single rate may be available for the entire contract.