Construction Contractors and the New Davis-Bacon Act Rule: Increased Costs, Heavy Regulatory Burden

Description

The DOL recently issued a long-anticipated final rule, effective Oct. 23, 2023, making significant changes to the DBRA that will complicate compliance for federal construction contractors; likely raise wages and costs related to contract performance; and shift more risk and regulatory burden to the contractors. The DBRA applies to the majority of federal and federally assisted construction contracts and requires the payment of locally prevailing wages and fringe benefits to construction workers performing work under these contracts.

Among its more significant changes, the new rule redefines "prevailing wages" and how these are calculated so that it may potentially increase wages for hundreds of thousands of construction workers. Other noteworthy changes include application by operation of law so that the DOL may decide that a contract was incorrectly deemed not to have been covered under the DBRA from the beginning, causing retroactive application, so that contractors and sub-contractors have instant backpay obligations and increased costs moving forward. The rule also allows for contractors to be held responsible for subcontractors' DBRA violations and adopts additional recordkeeping requirements.

Construction counsel should be aware of these sweeping revisions and how they will likely impact their clients moving forward.

Listen as our expert panel discusses the new rule in detail, including how counsel may help their clients determine prevailing wages and fringe benefits, the increased risk of liability for their construction clients, and the danger of retroactive application that could result in backpay obligations and increased costs. The panel will also provide counsel with best practices for compliance.