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PREVAILING WAGE

What is Davis-Bacon and the Prevailing Wage?

The Davis-Bacon Act, often referred to as the Prevailing Wage law is a predetermined wage, established by the U.S. Department of Labor, Wage and Hour Division. Although many refer to it as a Union Wage, it is in reality a "minimum wage" law. The wages established by the U.S. Department of Labor are based on information "voluntarily" submitted by employers, craft organizations, contractor groups, and other interested parties. Wages and benefits (if any) are determined by these surveys. Both union and non-union wages are often combined within the same wage decision.

Direct Federal or Federal Agency contracts are subject to the Davis-Bacon Act, and the predetermined wages, or a General Wage Decision. Also, contracts which are funded by the Federal Government are also subject to the Davis-Bacon Act, and are referred to as the Davis-Bacon and Related Acts (DBRA). A "Related Act" is where Congress has authorized the funding outside the Federal Government. One cannot assume the funding by the Federal Government make the project a Davis-Bacon project. A research of the Congressional Act authorizing the funding is also required and can be both time consuming and tedious. Funding can also be to a State, County, City, or an individual.

The State of Colorado, does not have a State Prevailing Wage. At this time only the City and County of Denver has a Prevailing Wage Law. While it does use the U.S. Department of Labor, General Wage Decisions, its administration and oversight, does not always follow the same procedures' as the Federal Law.

Classification:


When determining a prevailing wage, the Department of Labor also determines the proper classification for the corresponding wage and benefit. Therefore, it is the work you perform not the classification your employer assigns you which determines what your proper pay is. You should also note, work performed has nothing to do with how qualified you are. As an example:

Let's say a common laborer is told to jump on a loader and move some dirt. The individual may have some basic knowledge of the controls or none at all, but he is definitely not a loader operator. Due to his lack of skills, it takes him and hour and a half to move that pile of dirt. A qualified operator may have taken 20 or 30 minutes. The employer pays the individual as a Laborer claiming a lack of skill. Under both the Davis-Bacon Act and the City and County of Denver Prevailing Wage laws, regardless of their skill level, the Laborer has to be paid (wages and benefits) and classified as an Operator for the time spent operating the loader.

Paid "Without regard to skill" for the work performed. This applies to all trades and crafts. Keep in mind the reference to a Laborer is in this example is used as it is generally the lowest wage on a General Wage Decision, it can and does happen with almost all crafts. Also, averaging for wages for various types of work is not allowed.

Of particular note, the individual must also be reported as an Operator on a certified payroll. Many only concern themselves with the money aspect of a violation. However, the survey which is conducted by the Department of Labor is based on payroll records. So if the employer corrects the wage, but not the classification, the laborer could very well be determined to prevail for the operation of a loader the next time a survey is conducted.

Apprenticeship and Training:

There is only one exception for the predetermined wage to be paid. The exception is "Apprenticeship and Training". To be an Apprentice, the "Apprenticeship Program" must be approved and registered with the U.S. Department of Labor, Employment and Training Administration. Then the individual must also be registerd with the Employment and Training Administration within the individual program. The other part of the exception are "Training Programs", again these have to be registered with the U.S. Department of Labor as do the individuals in the program.

Some states also have "Training Programs" in their State Highway Departments which are granted the exception. These programs are not registered with the U.S. Department of Labor or approved by them, but are qualified as "Training Programs" for Davis-Bacon Act requirements. These programs are only approved for work on State Highway projects which have approved "Training Programs". Work on other Highway Projects is not approved for this exception.

Don't be misled, non-union companies have registered Apprentice and training programs.

Apprentices can perform work as part of the Apprenticeship, in the program they are registered in, and be paid less than the predetermined wage. However, if the "Apprentice" or "Trainee" performs work outside the program, they are entitled to and must be paid the full predetermined wage, benefits, and be classified for the work they perform. Again, this is without regard to skill for work performed outside the program registered in.

Employee Records:

Enforcing both laws are often complicated by a lack of records and documentation. This is complicated by fear. Fear of losing your job. Understandable! But violations are more often than not, just an administrative process. Which more often than not are based on one guy who took the time, out of no more than the habit to track his work, for tax purposes or for medical record tracking. With a simple pocket calendar, or diary he filled at lunch or the end of the day.

A good habit for a responsible worker to develop is to keep a personal record of each job he/she works on. Records should include the name of the project, the type of the work performed (for example: equipment operated), name of employer, and all hours worked. Paid or not. This record should reflect each classification worked on a daily basis. Remember to keep each week's record with its corresponding pay stub and save them. These records are important to you and more often than not your family.

Have a prevailing wage problem?

We may be able to answer your questions on wage rates and fringe benefits for all classifications of work. We can help you and others interpret the laws so that everyone can better understand their rights and responsibilities under the law.

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