Labor
Federal Judge Blocks Part of Davis-Bacon Update Rule Pending AGC Lawsuit
The lawsuit filed by the Associated General Contractors of America last November is challenging specific provisions included in the Dept. of Labor's final rule relating to the Davis-Bacon Act.
Photo by Michael Maddox/U.S. Army Corps of Engineers, Louisville District
A federal judge in Texas temporarily blocked some provisions of a rule the U.S. Dept. of Labor finalized last year expanding the Davis-Bacon Act, and signaled that the Associated General Contractors of America is likely to succeed in its lawsuit challenging parts of the rule.
AGC, along with its Texas chapter plus the Lubbock Chamber of Commerce and Amarillo,Texas-based contractor J. Lee Milligan Inc., filed the suit last November targeting parts of the rule that expand Davis-Bacon Act prevailing wage requirements on federally funded projects to truck drivers and material supplier employees in some cases. The rule took effect Oct. 23 with support from unions and criticism from some contractor groups.
U.S. District Court Judge Sam Cummings in Lubbock issued the injunction June 24, blocking Labor Dept. officials from enforcing three provisions of the rule challenged by the plaintiffs pending completion of the case.
Jeffrey Shoaf, CEO of AGC, said in a statement that the association’s concern is that the Labor Dept. “is expanding the scope of the rule well beyond what Congress ever intended.”
“This injunction restores the original intention of the Davis-Bacon Act,” Shoaf said.
In the injunction, Cummings wrote that the plaintiffs “are substantially likely to succeed on their claims” that the Labor Dept. lacks statutory authority to enforce the challenged provisions. He added that federal agencies “do violence to the Constitution when they attempt to unilaterally amend acts of Congress to suit their policy choices.”
The Labor Dept. has argued that the rule does not expand coverage of Davis-Bacon, but simply codifies existing policy while making some small adjustments. Officials have said the rule improves its ability to enforce Davis-Bacon Act labor standards more effectively and efficiently. Department representatives did not immediately respond to inquiries about the injunction.
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Cummings found that the Labor Dept. is not at risk of suffering any financial lost from the injunction, while the plaintiffs have shown there is a substantial threat that the rule “will cause irreparable harm” to contractors because of uncertainty it creates in the bidding process, as well as added administrative expenses, the difficulty of ensuring compliance and the risk of debarment from federal contracting if a firm errs in following the requirements.
The injunction does not block other sections of the rule, such as reverting to an earlier definition of “prevailing wage” that was changed during the Reagan administration, updating prevailing wage rates and providing more authority for state or local wage determinations in some cases.
However, the Associated Builders and Contractors is also separately suing the Labor Dept. to challenge the rule, saying it “unlawfully expands coverage of prevailing wage requirements onto new projects and industries and increases its regulatory burden on small construction contractors working on federally funded contracts.” That case in Eastern Texas U.S. District Court is ongoing.
