Curious about the latest labor regulations? The U.S. Department of Labor’s wage determination process has a new rule coming into play on October 23, 2023. The Davis-Bacon Final Rule brings significant changes while retaining some key elements. The Davis-Bacon and related acts mandate that federal and federally assisted contractors pay prevailing wages, along with meeting enforcement and record-keeping requirements. This comprehensive 700-page rule reverts to a pre-Reagan era definition of prevailing wages, lowering the threshold from 50% to 30%.
The new rule also consolidates various past rules and guidance into a single set of clear directives for contractors to follow, simplifying compliance efforts. Notably, it expands the scope of Davis-Bacon coverage to include additional work and sites such as prefabrication, manufacturing facilities, material suppliers, and their truck drivers. While these changes aim to clarify and broaden wage determinations, they are expected to increase costs for projects and material suppliers, ultimately affecting the bidding process. The Associated General Contractors of America (AGC) has been proactive in this regulatory reform, forming a Davis-Bacon reform task force and submitting over 30 recommendations. Many of these suggestions were acknowledged and incorporated into the final rule. AGC continues to analyze the rule’s impact, providing resources and guidance to its members and chapters to navigate these changes effectively.