The U.S. Department of Labor’s finalization of a rule updating the Davis-Bacon Act, the federal law that governs how prevailing wages for federal construction projects can be determined, will have a significant impact on contractors and workers alike in the construction industry. The new rule, in effect, adopts the 30% rule, meaning that the prevailing wages must be equal to the wage paid to at least 30% of workers of a particular classification in a particular area. The new rule also implements a new anti-retaliation provision, specifically protecting construction workers who raise concerns about payment practices from adverse employment actions. The timing of this new rule is particularly significant for contractors, as it will likely raise the cost of labor for contractors at a time when the Infrastructure Investment and Jobs Act and the CHIPS Act are providing additional funding for federal projects across the country. Thus, it is important for all parties in the construction industry to understand the updated rule in order to evaluate the short-term impacts on their respective projects and long-term impact on their respective businesses.

Reprinted courtesy of Seth C. Wiseman & Angela M. Richie, Construction Executive, a publication of Associated Builders and Contractors. All rights reserved.

Mr. Wiseman may be contacted at swiseman@grsm.com
Ms. Richie may be contacted at arichie@grsm.com