The U.S. Dept. of Labor has proposed sweeping changes to the Davis-Bacon Act in an effort to ensure that the prevailing wages required on federal and federally assisted construction projects accurately reflect what workers are actually paid, agency officials said.

The officials said during a March 11 press briefing that the update would be the first time the law has been substantially revised in 40 years.

The statute, enacted in 1931, sets the procedures for determining the wages for workers on federal and federally assisted projects based on the local “prevailing” rates.

In addition to the Davis-Bacon Act, there are about 60 other federal laws that include prevailing-wage provisions, according to DOL.

One newly proposed change would require that prevailing-wage rates be updated periodically to address out-of-date wage determinations.

DOL also is proposing to include supplemental rates for key job classifications when no survey data exists and toughen enforcement measures to ensure that employers do not retaliate if an employee reports that they are not receiving the correct wage amounts, said Jessica Looman, the department's  acting wage and hour administrator. 

The changes were prompted at least in part by the enactment in November of the Infrastructure Investment and Jobs Act, which is expected to create many more construction jobs.

“Given recent unprecedented investments in our nation’s infrastructure," Looman said, "this comprehensive regulatory review is necessary to ensure employers on federally funded or assisted construction projects pay fair wages to the workers who build our roads, bridges, federal buildings and energy infrastructure.”

The proposed rule also would resume the use, when needed, of a three-step practice for calculating rates. That was the common method for determining wage rates until it was discontinued in 1983 during the Reagan administration. 

The three-step process would result in less use of weighted averages to determine rates, Looman said. Weighted averages are used when there are too few people earning a particular rate to be able to call it “prevailing." 

Since 1983, the prevailing-wage rate has been set at a number that the majority—51% or more—of workers are paid. If the number of workers is less than 51%, weighted averages are used. 

If less than 51% is earning a particular rate, DOL is now proposing to do away with the automatic use of weighted averages to determine the prevailing rate.

Instead, under the proposal, if 30% or more of the workforce is earning that rate, the level would be judged the prevailing one.

In addition, if less than 30% of workers is earning the prevailing rate, DOL is asking wage and hour officials to use a weighted average.

Ben Brubeck, Associated Builders and Contractors vice president of regulatory, labor and state affairs, said in a statement that although he was still reviewing the rule, “it appears the DOL missed an opportunity for meaningful Davis-Bacon reform."  

Brubeck said that resuming a practice abandoned in 1983 is "not modernization." Instead, he said that "it is even worse public policy catering to special interests embedded in the Biden administration that benefit from the broken status quo.”

But organized labor, including North America’s Building Trades Union, applauded the proposed revisions.  NABTU President Sean McGarvey said in a statement, “The Davis-Bacon wage floor prevents cut-throat bidding practices from driving down local area labor standards on over $200 billion in federal and federally assisted projects."

McGarvey added that "the proposed updates to the regulations will restore the act’s intended bipartisan purpose to protect the hard-earned wages of construction workers, and in doing so, shield them from exploitation.” 

The Labor Dept. will accept comments on the proposal for 60 days after publication in the Federal Register, which is expected this week.