What is the Davis-Bacon Act in construction?
The Davis-Bacon Act requires contractors and subcontractors on federal and federally funded construction contracts over $2,000 to pay laborers and mechanics at least the locally prevailing wage and fringe benefits. The Department of Labor's Wage and Hour Division issues the wage determinations. It does not cover private jobs without federal funding, though many states have their own prevailing wage laws.
The Davis-Bacon Act is a federal law that sets a wage floor on government construction. According to the U.S. Department of Labor, it applies to contractors and subcontractors on federal or District of Columbia contracts, and federally assisted contracts, over $2,000 for the construction, alteration, or repair (including painting and decorating) of public buildings or public works. Covered laborers and mechanics must be paid at least the prevailing wage and fringe benefits listed in the contract's wage determination.
The Act itself is codified at 40 U.S.C. 3141 and following. Dozens of related laws that fund highways, housing, water systems, and schools carry the same labor standards, which is why you will hear the phrase Davis-Bacon and Related Acts (DBRA).
How Davis-Bacon works on a real job
The wage determination is attached to the bid package. It lists a classification (electrician, laborer group 2, operating engineer) with a base hourly rate and a fringe rate for the county. DOL says wage determinations are published on SAM.gov for agencies to include in contracts. Your job is to match every worker to the right classification and pay at least the total of base plus fringe for every hour on site.
DOL Fact Sheet 66 says the obligation can be met with all cash wages or a combination of cash and bona fide fringe benefits, and that contractors must pay covered workers weekly and submit certified payroll to the contracting agency each week. Form WH-347 is the optional DOL form many contractors use for that weekly submission.
| Item | Per hour |
|---|---|
| Wage determination base rate | $38.00 |
| Wage determination fringe rate | $14.50 |
| Total required | $52.50 |
| Employer pays into health and pension plan | $11.00 |
| Cash fringe added to check | $3.50 |
| Base paid | $38.00 |
In that illustration, the employer meets the $14.50 fringe with $11.00 in plan contributions and $3.50 in cash. The rates are made up for the example; use the actual wage determination in your contract.
Common Davis-Bacon mistakes
- Using the wrong wage determination or classification, especially when a worker does more than one kind of work. See dual classification.
- Paying apprentices the apprentice rate when they are not registered in an approved program, or exceeding the allowed apprentice ratio.
- Missing weekly payrolls from lower-tier subs. The prime contractor is responsible for flowing the requirements down.
- Taking fringe credit for benefits that are not bona fide or that the employer is already required by law to provide.
- Forgetting overtime. The Contract Work Hours and Safety Standards Act adds overtime requirements on many covered contracts.
Related terms
Davis-Bacon connects to state prevailing wage laws by state, fringe benefit credits, and project labor agreements. For step-by-step help, read how to find the right Davis-Bacon wage determination. Smart Business Automator prepares weekly certified payroll from timecards; see certified payroll automation.
Frequently asked questions
What is the Davis-Bacon threshold?
DOL states the Act covers federal and federally assisted construction contracts in excess of $2,000. Related Acts may define coverage through the funding program, so check the contract.
Does Davis-Bacon apply to private jobs?
Not unless the project receives federal funding or assistance under a law that carries Davis-Bacon requirements. Many states have their own prevailing wage laws for state and local public work.
Who issues Davis-Bacon wage determinations?
The U.S. Department of Labor's Wage and Hour Division. They are published on SAM.gov and included in the contract by the contracting agency.
Is form WH-347 required?
No. DOL says use of WH-347 is optional, but the weekly certified payroll information and signed statement of compliance are required.
Do subcontractors have to follow Davis-Bacon?
Yes. The requirements apply to covered subcontractors at every tier, and the prime contractor is responsible for their compliance.
