In two All-Agency Memorandums (AAMs), the U.S. Department of Labor’s Wage and Hour Division (WHD) provides new guidance to contracting agencies with construction work covered by the Davis-Bacon and Related Acts. One AAM explains when survey crew members are considered laborers or mechanics under the Davis-Bacon Act. The other clarifies how proposed wage rates should be determined during the conformance review process, the process by which contracting agencies request additional classifications or rates that are not listed on the Davis-Bacon wage determination. Contractors and subcontractors should consider both memorandums when requesting rate and/or classification changes to an applicable Davis-Bacon wage determination.
All-Agency Memorandum 212
In AAM 212, WHD responds to a request that field supervisors performing on-site work that is integrated with construction work covered by the Davis-Bacon Act be recognized as a subclassification of operating engineer. As a result, WHD clarified the application of Davis-Bacon standards to survey crew members who may be employed as laborers and mechanics on Davis-Bacon projects. The guidance does not replace but supplements guidance provided in previous AAMs on the subject.
To ensure that survey crew members are recognized appropriately as laborers or mechanics on Davis-Bacon-covered projects, WHD has determined specific requirements that contracting agencies should consider when processing conformance requests. The guidance states that “survey crew members who perform primarily physical and/or manual work immediately prior to or during actual construction, and in direct support of construction crews, will be considered laborers or mechanics when employed on the site of work.” Spending 50 percent or more of their time performing such work will generally satisfy the primary duty requirement, providing the worker is not an exempt professional, executive or administration employee according to Fair Labor Standards Act. In addition, the guidance further clarifies that the determinant for whether a worker is a “laborer or mechanic” as defined under the Davis-Bacon Act depends on whether the actual duties performed are manual or physical in nature. This includes workers who use tools or who are performing the work of a trade. The guidance advises contracting agencies to accept requests to add classifications to Davis-Bacon wage determinations for survey crew members who meet these requirements.
All-Agency Memorandum 213
AAM 213 specifies that the proposed wage rate as requested during the conformance process bear a “reasonable relationship” to other wage rates contained in the same wage determination. To determine a “reasonable relationship,” contractors should compare the requested additional classification to other classifications on the same wage determination, within the same category. The four categories for contractors to consider include skilled crafts, laborers, power equipment operators and truck drivers. In addition, the proposed work in question should not be performed by any other classification in the wage determination. In the past, WHD has generally approved conformance requests when the proposed wage rate was not less than the rate listed for the lowest classification in the respective category on the wage determination.
When proposing rates for an additional classification, the guidance further requires that the originating source of the existing wage rate is considered. For example, if a wage determination contains predominantly union prevailing wage rates for skilled classifications, consider the union sector skilled classifications in the wage determination when suggesting a rate. The same applies for non-union prevailing wage rates. The guidance states that if the wage rates in the applicable category are half union and half non-union, then it is typically appropriate to look to the lowest union rate and highest non-union rate, assuming the union rates are higher.
The AAM states that contracting agencies should take the following steps when requesting a wage rate change:
- Determine the category (skilled crafts, laborers, power equipment operators or truck drivers) of the classification which is being conformed
- Determine, for that category, whether the union or non-union rates prevail in the existing wage determination
- After reviewing the entirety of the rates within the appropriate sector in the applicable category, determine a rate that bears a reasonable relationship to those rates on the wage determination
- Determine whether any of the considerations identified in AAM 213 apply. For example, if the classification being conformed is a skilled classification and some of the wage rates for skilled classifications in the wage determination are lower than the rates for laborers, then the existing skilled classification rates that are higher than the laborer rates should be used to determine the proposed rate. If the classification which is being conformed is a laborer classification, the existing common laborer rate should be used as a benchmark.
WHD advises contractors and contracting agencies that are seeking new classifications and wage rates to not rely on a wage determination or conformance granted to another party, or to the same party for work performed at the same location, regardless of the similarity of the work in question. In conjunction with AAM 213, WHD has provided a series of frequently asked questions for contractors and contracting agencies.
Generally, in order to improve the accuracy of classifications and wage rates listed in Davis-Bacon wage determinations, AGC encourages construction contractors to participate in the Davis-Bacon wage survey process. Review AGC’s guide for contributing to the accuracy of published prevailing wage rates in construction for additional information. For additional resources on the Davis-Bacon Act and the conformance process, visit AGC Labor & HR Topical Resources webpage. The primary category is “Compensation” and the secondary category is “Davis-Bacon Act.”