Posted on November 5, 2010 by Chris Cheatham

Do Davis-Bacon Wage Issues Affect Your Stimulus Project?

Across the country, government officials are scrambling to award and spend American Recovery and Reinvestment Act (ARRA) funding before upcoming deadlines.  If you are a contractor or subcontractor lucky enough to work on one of these projects, congratulations! 

Now comes the tough part. 

Working on a federal or state-funded project brings a myriad of regulatory issues that must be resolved.  One of those issues is Davis-Bacon compliance.  As you sort out compliance issues, here are some questions to think about: 

  • Is the project a federal project subject to federal labor laws? 
  • Is the project a state project subject to state labor laws?
  • Is the project both a federal and state project subject to both federal and state labor laws?

Is your head spinning yet?  In some circumstances, depending on the government agencies involved and the source of funding, you may actually be subject to both federal and state labor laws.  I have assisted clients with these confusing issues, so please contact me if you have questions (chris@cheathamconsulting.com). 

Photo Credit:  NIOSH

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Posted on March 19, 2010 by Chris Cheatham

Do LEED APs Get Higher Wages?

Douglas Reiser, who publishes at the Builders Counsel Blog, recently posted an interesting question regarding Davis-Bacon wage determinations for green building projects:

"What do you think about Davis-Bacon worker/payment classifications for 'green building' specialists or professionals? Should there be a classification for your project's LEED AP? How about for any independent raters?  I am thinking that there might be a debate about HVAC, electrical, and plumbing workers who are trained in sustainable practices - do they require higher wages than your normal subcontractors?"
I have previously discussed the delay to the Department of Energy's weatherization program caused by the Department of Labor's wage determinations.  In December 2009, the Department of Labor came out with new wage determinations for weatherization work. 
 
In its Virginia wage determinations (PDF), the Department of Labor explained that it "does not issue separate wage determinations based on a worker's skill, experience or individual training."  As LEED AP involves a workers "skill, experience, or individual training," I do not anticipate the Department of Labor will adjust wage determinations for LEED AP status. 
 
The wage determinations are broken down into six categories that constitute a number of "green jobs":
  • Weatherization worker
  • Doors & windows replacement worker
  • HVAC, furnace, heating & cooling repair, installation and replacement worker
  • Carpenter
  • Electrician
  • Plumber
Contractors working on federal green building projects need to be aware of new wage determinations that will impact your project. 
 
Related Links: 
 

Virginia Residential Weatherization Wage Determination

(DOL)(PDF)

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Posted on March 5, 2010 by Chris Cheatham

Does Your Construction Project Require Davis-Bacon Wages?

[I have said many times that the legal principles that will apply to green building projects will be very similar to existing legal principles in the construction law field. Going forward, on Fridays we will be reviewing legal developments from the construction industry that most likely will be applied to green building projects.]
 
If you are working on a construction project funded by the American Recovery and Reinvestment Act (or you have any hint that you are), you need to be aware of your responsibility to pay Davis-Bacon wages.
 
Section 1606 of the American Recovery and Reinvestment Act (ARRA) sets out the Davis-Bacon wage requirements:
"Notwithstanding any other provision of law and in a manner consistent with other provisions in this Act, all laborers and mechanics employed by contractors and sub contractors on projects funded directly by or assisted in whole or in part by and through the Federal Government pursuant to this Act shall be paid wages at rates not less than those prevailing on projects of a character similar in the locality as determined by the Secretary of Labor in accordance with subchapter IV of chapter 31 of title 40, United States Code."
The Department of Labor (DOL) has broadly interpreted Section 1606 (pdf) of American Recovery and Reinvestment Act (ARRA):
"Section 1606 of ARRA plainly indicates that the Davis-Bacon prevailing wage requirement broadly applies to ARRA-appropriated construction projects. . . . [The ARRA] also extends the prevailing wage requirements to projects 'assisted in whole or in part by and through the Federal Government pursuant to this Act' thus encompassing any assistance provided for ARRA projects through grants, loans, guarantees, and insurance."
In short, if any ARRA dollars are funding your construction project, Davis-Bacon wages are required (barring very limited exceptions). If you are working on a construction project in 2010, particularly one funded by a governmental entity, it is important that you ask if the project is being funded in any amount by ARRA funds.  If ARRA funds find their way into your project and you have not accounted for Davis-Bacon wage requirements, a change order may be necessary. 
 
Related Links
 
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