Government Contracts

 


Determining Wage Rates

Federally financed or assisted construction projects subject to the Davis-Bacon and related Acts (DBRA) must contain a prevailing wage determination (WD). The wages on the WD are typically determined by surveying ongoing or recently completed construction projects within a geographic area. WHD conducts the surveys of projects under construction or completed during a set survey time frame in an effort to gather specific wage rate data paid to the various classifications of workers found on construction projects. Federal and federally assisted construction work is broken out into four different types of construction for which WHD gathers wage rate data and issues wage determinations:

 
Determining Wage Rates
Survey Types
Building

Building

Includes sheltered enclosures with walk-in access for the purpose of housing, persons, machinery, or supplies

Residential

Residential

Includes construction, alteration or repair of single family houses or apartment buildings of no more than four stories in height

Highway

Highway

Includes roads, streets, runways, highways or other similar projects

Heavy

Heavy

Is a catch-all grouping that includes projects not properly classified under the other three types of construction

 

All Agency Memoranda (AAM) 130, 131, and 236 collectively establish guidelines and provide detailed information regarding the four types of construction. WHD gathers wage rate data and issues wage determinations for these four types of construction.

AAM No. 213 and 233: Application of the Davis-Bacon and Related Acts requirement that wage rates for additional classifications, when “conformed” to an existing wage determination, bear a “reasonable relationship” to the wage rates in that wage determination.  AAM 213 and 233 should be read in conjunction with each other.

When initiating a wage survey, WHD sends out survey forms to interested parties and contractors identified as working on projects in the survey area during the designated time frame.  Data may be submitted by any other contractors and interested parties.  The Form WD-10 is used to submit data for DBRA wage surveys.  All submitted survey data is analyzed, clarified, and reviewed by staff in the Branch of Wage Surveys.  In order to ensure the accuracy and completeness of the data submitted, a two step verification process is used. 

Upon completion of the verification process, and after any necessary changes are made, prevailing wage rates are calculated. WHD calculates the basic hourly rate first and then calculates any prevailing fringe benefits.

The regulations define the prevailing wage rate as the rate paid to the majority of workers in a classification. If the same rate is not paid to a majority of workers, then a weighted average is calculated.  In determining fringe benefits, WHD determines in the classification if there is a prevailing practice of paying a fringe benefit.  If a majority of workers in the classification are not paid a fringe benefit, no fringe benefit will be calculated.  If a majority of workers are paid fringe benefits, then the fringe benefit will be calculated in a manner similar to the basic rate calculation.  If a majority of the reported workers receive the same fringe benefit, then that fringe benefit will prevail.  If the same fringe benefit is not paid to a majority of the reported workers, a weighted average is calculated.

Wage rates often are calculated and issued on a county basis.  If there is insufficient data to issue a rate on a county basis, then the geographic area used to determine prevailing wage rates may be expanded.  29 CFR Part 1.7

There are minimum sufficiency requirements that must be met to publish a classification and rate on a WD.  If a classification or particular rate does not appear on a WD, it is because insufficient information was received for that classification or rate during the survey process.  Contractor participation in the survey process is critical to receiving sufficient data to publish complete WDs.  After completion, survey results are tabulated on WD-22 (Wage Compliation) and on WD-22a (Project Compilation) by Wage and Hour Staff.  After tabulation, survey results are then submitted for publication.  The website SAM.gov contains copies of all published wage determinations.

For more information on the wage survey process, click here.

Public Inquiries and Requests

All DBRA survey inquiries, general requests, and survey appeals should initially be directed to the Branch of Wage Surveys. If the requestor wishes to appeal the decision made by the  Branch of Wage Survyes, then a request for review and reconsideration may be made to the Wage and Hour Administrator (See 29 CFR Part 1.8). If an interested party wishes to appeal the decision of the Administrator, an appeal may be filed with the Administrative Review Board (ARB). (See 29 CFR Part 7.) The ARB's decisions in such appeals are final. An explanation of this appeals process is found at the end of every published wage determination.

Conformance Requests

The Department of Labor’s Wage and Hour Division (WHD) determines locally prevailing wage and fringe benefit rates through the conduct of wage surveys on government contracts covered by the Davis-Bacon Act. Published wage determinations for each county in the country list the wages and benefits that have been found to be prevailing for each classification of worker for which there is sufficient wage payment data. Data collection for these surveys is dependent upon the voluntary submission of information from contractors and third parties that have performed construction work within the geographic scope of the wage survey. At times, the survey collection efforts will not yield sufficient data to establish a rate for every existing classification of work. When this happens, WHD cannot establish a rate for that job classification on the wage determination.

When a contractor performs work on a DBA-covered contract and the applicable wage determination does not provide a rate for a classification of work to be performed, the needed classification and wage rate must be added in conformance to the contract wage determination. This is the conformance process. Accurate and current wage rates are the cornerstone of the DBA’s protections, and provide the framework around which prevailing wage requirements protect contractors, employees, and local economies. The Wage and Hour Division has been working to improve opportunities for stakeholder participation; to improve outreach before surveys; and to improve the quality of the wage determinations that result.

CFR 29 Part 5.5(a)(ii) sets the criteria that must be met to obtain a rate for an unlisted classification. See the Conformance Requests page for more information.