UNDERSTANDING THE DAVIS BACON ACT IN THE CONSTRUCTION INDUSTRY
Lance Luke
2/28/20251 min read
The Davis-Bacon Act (DBA) is a federal law that requires contractors and subcontractors to pay laborers and mechanics on federally funded or assisted construction projects the local prevailing wages and fringe benefits. The DBA was passed in 1931 in response to concerns that low wages on public works projects were depressing wages for construction workers across the country.
The DBA is applicable to all federally funded or assisted construction projects, including those involving buildings, bridges, utilities, levees and dams, military bases, educational institutions, and hospitals. The DBA also applies to construction projects that are funded by state or local governments if the project is partly funded by the federal government.
The DBA sets forth two different methods for determining the prevailing wage on a construction project:
The area wage determination: This method is used for projects in areas where there are a sufficient number of workers to establish a prevailing wage. The prevailing wage is determined by surveying employers in the area to determine the most common wage rate for each type of work.
The government contract wage determination method: This method is used for projects in areas where there is not a sufficient number of workers to establish a prevailing wage. The prevailing wage is determined by surveying employers who have similar contracts with the federal government.
In addition to the prevailing wage, the DBA also requires contractors and subcontractors to pay certain fringe benefits, such as health insurance, pension contributions, and vacation pay. The specific fringe benefits that are required vary by locality.
The DBA is enforced by the U.S. Department of Labor's Wage and Hour Division. Contractors and subcontractors who violate the DBA can be subject to fines and penalties.
The DBA is a complex law with many nuances. If you are a contractor or subcontractor who is considering bidding on a federally funded or assisted construction project, it is important to understand your obligations under the DBA. You can find more information about the DBA on the U.S. Department of Labor's website.
© 2026 | Lance Luke | Expert Witness