Frequently Asked Davis-Bacon Questions and Answers
Here you can find answers to questions dealing with compliance with the Davis-Bacon Act (DBA) requirements of the 2009 Recovery Act for the U.S. Department of Energy (DOE) State Energy Program (SEP) and Energy Efficiency and Conservation Block Grant Programs (EECBG). You can find answers on the following topics:
Where do I go for more help with Davis-Bacon Requirements?
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Where to Obtain Additional Information:
For additional information, please visit the U.S. Department of Energy (DOE) Office of Energy Efficiency and Renewable Energy Weatherization and Intergovernmental Program Web site.
You may also visit the U.S. Department of Labor (DOL) Wage and Hour Division or call the DOL Wage-Hour Toll-Free Information and Helpline between 8 a.m. and 5 p.m. (in your time zone): 1-866-4US-WAGE (1-866-487-9243).
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General Questions
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Why does the DBA apply to the DOE State Energy Program (SEP) and Energy Efficiency and Conservation Block Grant (EECBG) Program?
The American Recovery and Reinvestment Act (ARRA) of 2009 provided approximately $3.1 billion in funding for DOE's SEP and $3.2 billion in funding for DOE's EECBG program. Section 1606 of the Recovery Act specifies that laborers and mechanics employed by contractors and subcontractors on construction projects funded directly by or assisted in whole or in part under the Recovery Act, which includes the DOE-funded SEP, must be paid at least the wages rates prevailing in the locality in accordance with the DBA. State and local units of government are not considered contractors under the DBA when the construction is performed by their own employees. Contractors and subcontractors of State and local units of government are also DBA-covered.
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Are prevailing wages going to be required for all projects using Recovery Act money, whether or not they are public sector projects?
Yes.
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Are local government providers employees subject to DBA?
Local units of government are not considered by the Department of Labor to be contractors or subcontractors, and their workers are not covered by DBA. Any contracts awarded by the local government, however, must include the DBA labor clauses and applicable wage determination(s) for work performed using SEP and EECBG grant funding under the Recovery Act.
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Is the $2,000 Davis-Bacon Act threshold based on the entire amount of the contract, including equipment costs, or only on the labor costs?
The $2,000 DBA threshold applies to the total cost of a contract; it is not based on contract labor costs alone.
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Can States use HUD Davis-Bacon forms?
No. Please use the standard U.S. Department of Labor (DOL) forms that are available on the DOL Wage Determinations page of its Web site. There you can find, for example, the Certified Payroll form (PDF 308 KB). Download Adobe Reader.
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Does the DBA apply to the Appliance Rebate Program?
No, the DBA does not apply to the ENERGY STAR® Appliance Rebate Program. The DBA only applies to laborers and mechanics performing construction at a work site, and the Appliance Rebate Program does not involve the use of laborers and mechanics. Additionally, the DBA does not apply to workers of the material suppliers who deliver and set up energy efficient appliances such as refrigerators, for example, because they spend a minor amount of time working at the delivery site.
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Davis-Bacon and Other Funding
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If an agency uses other non-Recovery Act funding on a job that includes the use of SEP funding, does the contractor have to pay DBA wages for all the work?
If the ARRA-funded work is done in conjunction with the non-ARRA funded work, so that all the work is ongoing at the same time, the whole project is subject to the DBA. The Recovery Act provides that "all laborers and mechanics . . . on projects funded directly by or assisted in whole or in part" with Recovery Act funding are subject to the DBA.
If, however, the work is separated into two separate and distinct projects and not performed together (i.e., the work using non-Recovery Act funds is completed prior to or after the ARRA-funded work, the work crews are not working together, and separate contracts are used for the two types of work), the non-ARRA funded work would not be subject to the DBA. This separation of work answer assumes the non-ARRA funded work is not subject to DBA.
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Who is covered by the Davis-Bacon Act?
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Which workers are covered by DBA and which are not?
The DBA applies to laborers and mechanics employed at the work site. Auditors, inspectors, and other personnel not performing physical or manual work at the site of the work are not covered by DBA.
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Are working foreman covered by the DBA?
Yes, working foremen are covered for the time they spend working as a laborer or mechanic. Time spent filling our forms or ordering supplies is not DBA-covered work.
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Does DBA apply to workers of material suppliers who might deliver refrigerators or weatherization materials to a job site?
No. Material suppliers are not DBA-covered if they spend only an incidental amount of time performing work at the site.
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Davis-Bacon Wages
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Is it acceptable for a contractor to pay the DBA wage for all activities rather than worrying about those paid hours not actually on a job site? If so, then is there any need to separate those activities for reporting requirements?
Contractors may pay more than is required under the DBA, but they must never pay less. If the employee is paid the DBA wages for all activities, there would be no need to separate those activities for reporting requirements.
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Are employers able to take fringe benefit credit against the DBA prevailing wage requirements?
Wages under the DBA include both the cash wages and "bona fide" fringe benefits that are provided to laborers and mechanics. A covered employer may discharge its prevailing wage obligation for the payment of both straight time wages and fringe benefits by (1) paying both in cash, (2) making payments or incurring costs for "bona fide" fringe benefits, or, (3) by a combination thereof. Examples of fringe benefits include health insurance, pension contributions, and paid time off. The use of a company truck or employer required payments into Social Security or worker's compensation insurance are not examples of fringe benefits. Employers can take credit for their bona fide fringe benefit costs towards meeting the applicable prevailing wage rate.
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Davis-Bacon and Weekly Payroll
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What is a certified payroll and where can I find a copy with instructions for completing it?
All laborers and mechanics employed on the work site must be paid, unconditionally, at least once a week. Covered employers must submit a certified payroll on a weekly basis. The employer must sign the certified payroll, affirming that the information is complete and accurate. Falsification of the certified payroll record can result in debarment from future contracts for up to three years and/or criminal penalties.
A copy of a certified payroll form (WH-347) can be found on the DOL online information on the Recovery Act.
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Does the owner of a contracting company have to be listed on the certified payroll record if they also perform the duties of a laborer or mechanic at the work site? Are owners of the business covered by the DBA?
Bona fide owners who are exempt pursuant to Department of Labor regulations, found at 29 CFR Part 541, are not laborers and mechanics and are not subject to the DBA. Owners of a business who also perform construction work list themselves on the certified payroll and under the column for "Work Classification" insert the word "owner." Additionally, the owner of a contracting or subcontracting company, or authorized officer or employee who supervises the payment of wages must sign the Statement of Compliance for the certified payroll.
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Is it acceptable for a Recipient to receive an electronically created certified payroll from a contractor, if the document has a proper electronic signature?
Yes, current law establishes that the proper use of electronic signatures on certified payrolls and related compliance statements carry the same legal effect as handwritten signatures. Electronic certification documents are sufficient for compliance purposes under the DBA and may be accepted and maintained by the Recipient in compliance with its requirement to maintain the records on behalf of DOE. Recipients are responsible for ensuring the accuracy of the electronic signature process, and the proper retention and accessibility of the electronically transmitted documents.
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Is it acceptable for a contractor to scan the certified payrolls and send the scanned copy to the Recipient?
No, scanned documents do not carry the same legal effect as handwritten signatures for DOL enforcement purposes. As such, a contractor may not simply scan the certified payroll and forward to the Recipient. The Recipient, in turn, may not maintain such scanned certified payrolls as fulfillment of its requirements to maintain the records on behalf of DOE.
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Davis-Bacon Compliance
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Is it appropriate for Recipients, in certain instances, to conduct some on-site reviews at the local agency and contractor levels to ensure contract compliance?
Yes, it is appropriate for the State to conduct on-site reviews at the contractor levels. As set forth in the Davis-Bacon Act Requirements clause and the Recipient Functions clause that will be added to existing grants that already have been awarded to Recipients, Recipients are responsible for ensuring compliance with DBA requirements by contractors and their lower-tier subcontractors. On-site reviews are useful in ensuring compliance.
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Davis-Bacon and Multifamily Homes
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Will the new Weatherization Wage Determinations that DOL will be issuing apply to weatherization activities under the SEP for all structures, including multifamily units, such as apartment buildings and/or public housing units?
Weatherization activities on structures that are five stories or more in height are subject to the existing "building construction" general wage determinations rather than the "residential weatherization worker" wage determinations that DOL issued.
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If we are doing work in a multifamily building and using multiple sources of funding, which part of our work is covered by DBA?
If the ARRA-funded work is done in conjunction with the non-ARRA funded work so that all the work is ongoing at the same time, the whole project is subject to the DBA. The ARRA provides that "all laborers and mechanics . . . on projects funded directly by or assisted in whole or in part" with ARRA funding are subject to the DBA.
If, however, the work is separated into two separate and distinct projects and not performed together (i.e., the work using non-ARRA funds is completed prior to or after the ARRA-funded work, the work crews are not working together, and separate contracts are used for the two types of work), the non-ARRA funded work would not be subject to the DBA. This separation of work answer assumes the non-ARRA funded work is not subject to DBA. It is incumbent upon Recipients and sub-recipients to check with other Federal agencies when using their funding as part of any comprehensive project to determine the applicability of DBA to the use of the funding.
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Davis-Bacon and Travel Time
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Exactly what activities are covered by DBA? Travel time to the job site? Loading and unloading trucks? Time spent in the warehouse or classroom training?
The DBA requirements apply to laborers and mechanics employed on the site of work. Time spent at the home office, picking up supplies, traveling to the work site, etc., are not DBA hours. However, the non-DBA hours may count towards overtime for covered workers if DBA hours and non-DBA hours exceed 40 hours in a week.
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Davis-Bacon and Training Programs
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Are there going to be exemptions from DBA pay requirements for workers in training? For example, can local agencies pay a training wage and then have that wage modified to meet the prevailing wage rate once training is completed and the worker starts actual production?
A training or apprentice wage can be paid only if the trainee is registered in a DOL approved apprenticeship or training program or with a State Apprenticeship Agency recognized by DOL. Otherwise, the individual is to be paid the DBA rate for the classification of work that they are performing regardless of their skill level.
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Davis-Bacon and Volunteer Organizations
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Do AmeriCorps volunteers need to have Davis-Bacon wages or be registered as apprentices or should they be exempt as they're government employees?
The DBA provides that it does not supersede or impair any authority otherwise granted by Federal law to provide for the establishment of specific wage rates. The authorizing statutes for the Youth Conservation Corps, 16 U.S.C. 1703(a)(3), and the Public Land Corps, 16 U.S.C. 1726, for example, specifically require the Secretaries of Interior and Agriculture to set the rates of pay or living allowances for the Corps' participants. Other youth programs, such as the American Conservation and Youth Service Corps (AmeriCorps), 42 U.S.C. 126551, and Volunteers in Service to America (VISTA), 42 U.S.C. 4955, specify in the statutory language the living allowances and other benefits that must be provided to each participant. Therefore, since these Federal youth programs have established specific compensation to be paid to participants, such participants would not be covered by Davis-Bacon labor standards.
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How should agencies seek Davis-Bacon exemption for locally based volunteer organizations?
To determine whether any other Volunteer Organizations may be exempt, a written request for a determination should be accompanied with appropriate supporting documentation and must be sent to Mr. John L. McKeon, Deputy Administrator, Wage and Hour Division, 200 Constitution Avenue, N.W., Room S-3502, Washington, D.C. 20210.
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State Oversight of Davis-Bacon Requirements
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What is the Recipient's role in overseeing agency DBA compliance? Do they include reporting and recordkeeping requirements?
As set forth in the Davis-Bacon Act Requirements clause and the Recipient Functions clause that will be added to existing SEP grants that already have been awarded to Recipients, Recipients are responsible as part of their oversight role for ensuring compliance with DBA requirements by contractors and subcontractors. These clauses will specifically identify and clarify the responsibilities of Recipients under the SEP grants. These responsibilities include reporting and recordkeeping requirements; obtaining, maintaining, monitoring and reviewing the payroll records of the contractors, and subcontractors; and assisting DOE in its DBA enforcement responsibilities. DOE is ultimately responsible for ensuring DBA compliance on ARRA funded SEP projects. Recipient oversight functions are similar to prime and subcontractor DBA compliance responsibilities under a Federal contract. Costs associated with the Recipient's responsibilities for DBA compliance will usually be allowable costs in accordance with the terms of the SEP grant or the EECBG, which has been funded in whole or in part with ARRA funds.
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Who is responsible for ensuring contractor compliance as well as timely and accurate reporting from contractors?
Recipients are responsible for ensuring compliance with DBA requirements by contractors and lower-tier subcontractors. Many of the requirements, including reporting and recordkeeping, flow down to the contractors and lower-tier subcontractors. Contractors hired by the Recipients to perform work also have compliance responsibilities as well as reporting requirements. The specific responsibilities will be set forth in the DBA clauses, which will be included in the SEP grants and the EECB grants. However, DOE is ultimately responsible for ensuring compliance and enforcement of DBA on the ARRA-funded projects.
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Our State agency has a policy of retaining Davis-Bacon records in its offices for a period of one year and then in an off-site secure storage area for 3 years. Is the 3-year retention for DBA on-site or off-site?
All work payroll records must be retained for a period of 3 years. The Recipient may store the records at an off-site secure storage area out of its on-site offices once it has reviewed the records for accuracy. The records may be maintained either on-site or off-site for the 3-year retention period. The Recipient may determine how long the records will be maintained at a particular location. There is no need to maintain the payroll records for more than a total of 3 years after the project is complete. The records, whether stored on-site or off-site should be maintained so as to be easily retrieved should DOE, DOL, or an authorized agent require the records for an audit.
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To whom must certified weekly payroll be submitted? For example, the HVAC contractor will submit his payroll to the Contracting entity and the contracting entity will submit to the Recipient. Either way, at that point, are they submitted to DOL? If so how often? Or, is it none of the above, and all paperwork is just held at the local level to be inspected by monitors at the appropriate time?
The certified weekly payroll sheets are submitted from the contractor to the Recipient. If the Recipient or a sub-grantee is the contracting entity, then the contractor would submit directly to the Recipient or sub-grantee. The contracting agency reviews the certified payroll from its contractors and then forwards the contractor's certified payroll to the Recipient on a weekly basis.
The certified payrolls are not submitted to either DOL or to DOE. The Recipient maintains the certified payroll on behalf of DOE and makes them available for DOE's use. The Recipient must maintain records of its monitoring of DBA compliance and make those records available to DOE as part of the compliance checking undertaken by DOE. The Recipients are also required to maintain all certified weekly payrolls on behalf of DOE for a period of three years after completion of the project.
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Is it acceptable under 29 CFR 5.5 for the Recipient to require its sub-grantees to obtain independent weekly certification of its and its contractors' payroll to ensure compliance with Davis-Bacon?
Yes, it is acceptable. Sub-grantees are not required to have the payrolls certified independently; however, states may require its sub-grantees to obtain independent weekly certification if the Recipient believes there is a high risk of the sub-grantee's non-compliance. It is the Recipient's ultimate responsibility to review the records and ensure compliance with Davis-Bacon. Payroll must be calculated and paid weekly to employees. Laborers and mechanics are paid on an hourly basis and the DOL wage rate will contain both an hourly rate and an amount for bona fide fringe benefits. This is a question as to whether it is an allowable expense under the Grant.
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Davis-Bacon Compliance Costs to States and Local Agencies
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How will DBA compliance costs be charged at both the Recipient and sub-recipient level?
For the recipient, the costs associated with DBA compliance can generally be charged either as an administrative expense or training and technical expense, if training for implementation of DBA is conducted by the Recipient for its sub-recipients. For sub-recipients, these costs can generally also be charged as an administrative expense. However, Recipients should contact their respective DOE Project Management Center project officer or administrator for specific guidance on budgeting and charging costs associated with DBA compliance.
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