Prevailing Wage and Davis-Bacon: The Forgotten $10/hr Bump

The Davis-Bacon Act requires that workers on federally funded construction projects be paid the "prevailing wage" for their craft and locality. The prevailing wage is determined by the Department of Labor based on surveys of wages actually paid in the area for similar work.

Coverage:

• Federal construction contracts over $2,000 (basically all federal construction)
• Federally assisted construction in many cases (HUD-funded housing, FHWA-funded highways, federal grants for water/sewer projects)
• The Service Contract Act applies similar rules to federal service contracts (janitorial, security, food service)

Required components of the prevailing wage:

• Basic hourly wage (the cash wage you see on your paycheck)
• Fringe benefits (the value of health insurance, pension, vacation, training — often $5-$15/hour additional)

Employers can either pay the full prevailing wage in cash (basic + fringe combined) or pay the basic wage in cash and provide bona fide fringe benefits worth the fringe rate. Many contractors pay everything in cash to keep accounting simple.

The Department of Labor publishes prevailing wage determinations for every county and trade combination. To find yours:

1. Visit SAM.gov (formerly wdol.gov) and search for "wage determinations"
2. Enter your state and county
3. Select your construction type (Building, Heavy, Highway, or Residential)
4. Find your trade (Electrician, Carpenter, Laborer, Operating Engineer, etc.)
5. The published rate shows basic + fringe

Example rates from a recent Cook County, Illinois, Building determination:

• Electrician: $54.40 basic + $32.59 fringe = $86.99/hour
• Carpenter: $50.95 basic + $30.13 fringe = $81.08/hour
• Laborer (Group 1): $41.85 basic + $24.95 fringe = $66.80/hour
• Operating Engineer (Group 1): $58.95 basic + $32.50 fringe = $91.45/hour

These rates are dramatically higher than non-union private-sector rates for the same work. A non-union laborer in a typical Cook County private project earns $25-$35/hour. The same laborer on a federal project earns $66.80/hour.

23 states have their own prevailing wage laws covering state and locally funded construction projects. The major ones:

• California, Illinois, New York, New Jersey, Massachusetts, Washington, Minnesota, Oregon, Wisconsin, Ohio, Hawaii — broad coverage, similar to federal
• Pennsylvania, Connecticut, Michigan, Maryland, Maine, Rhode Island — coverage with specific thresholds

27 states have NO state prevailing wage law for state projects, including Texas, Florida, Georgia, North Carolina, Tennessee, Arizona, Indiana, and most southern and central states. In these states, only federally funded projects trigger prevailing wage requirements; state projects can pay market rates.

Some states have repealed their prevailing wage laws relatively recently (Indiana 2015, Wisconsin 2015 partial repeal, Kentucky 2017, Michigan 2018, Arkansas 2017). These repeals are politically contentious because of the wage impact on construction workers.

Department of Labor enforcement consistently finds these underpayment patterns on Davis-Bacon projects:

• Misclassification of trade. Paying a "laborer" rate to a worker actually performing electrician or carpenter work. The classification should match the actual work performed, not the worker's title.
• Understated hours. Recording 35 hours when 45 were actually worked, then paying straight time on overtime hours.
• Cash payments off the books. Paying part of the wage on the books at the prevailing rate and part off the books at a lower rate.
• Fringe benefit underpayment. Not providing the full fringe benefit value, either as cash or as bona fide benefits.
• Fake apprenticeship classifications. Classifying experienced workers as apprentices to pay reduced apprentice rates without actually enrolling them in a registered apprenticeship program.

If you believe you've been underpaid, you can file a complaint with the Department of Labor Wage and Hour Division. DOL can recover up to 3 years of back wages plus liquidated damages.

Three options for workers who have been underpaid prevailing wage:

1. File a complaint with the Department of Labor Wage and Hour Division. Free, confidential, and the most common path. DOL investigates and can recover back wages without you having to file a lawsuit. Backpay can extend up to 3 years.
2. File a private lawsuit under the FLSA. Some prevailing wage violations are also FLSA violations and can be litigated privately. Allows recovery of attorney fees.
3. File with state labor agency (in states with their own prevailing wage laws). Some states have shorter or longer recovery periods than federal.

Documents to keep:

• Pay stubs showing your hourly rate and hours worked
• Time records you kept independently of the employer
• The project's prevailing wage determination from SAM.gov
• Photos or descriptions of the work you performed (to prove your trade classification)

Workers cannot legally be retaliated against for filing prevailing wage complaints. Retaliation is itself a separate violation.