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DAVIS-BACON ACT

40 U.S.C. 276a-276a-5

Summary and Description

This act covers direct Federal construction, alteration, or repair of public buildings or public works, including painting and decorating, where the contract is more than $2,000, and applies to all agencies of the Federal Government and the District of Columbia that directly make construction contracts.

The Davis-Bacon and related Acts provide for minimum wages on construction work which shall be based upon the wages determined by the Secretary of Labor to be prevailing for the corresponding classes of workers on similar construction in the locality in which the work is to be performed.

These acts also provide for the determination of prevailing fringe benefits. These include medical care, pensions, unemployment benefits, life insurance, disability and sickness insurance, vacation and holiday pay, and costs of apprenticeship.

Money may be withheld from the contractor under the Davis-Bacon and related acts to pay underpaid workers. An employee who believes he is underpaid should complain to the contracting agency or to the Department of Labor. If an investigation confirms the underpayment, money is withheld from the contractor and the contractor is asked to make restitution. If the contractor refuses, funds withheld under the Davis-Bacon Act (but not under the related Acts) are forwarded to the Comptroller General where the employee may file a claim for the wages. Under the related acts the sponsoring agency processes the disbursement to employees.

If enough money has not been withheld to cover all underpayments to laborers or mechanics, a worker who does not receive all that is due him has the right to sue the contractor and the sureties on his bond under the Miller Act (see next page). It is no defense for the contractor that the worker has accepted or agreed to accept wages at rates less than the rates determined by the Secretary, or has refunded any of the wages voluntarily.

• The laws listed herein, among others, extend the Davis-Bacon Act to construction work, based on wage determinations by the Secretary of Labor : Federal-Ald Highway Act of 1956; United States Housing Act of 1937; Housing Act of 1949, Housing Act of 1950 (College Housing) ; Housing Act of 1959 (Housing for Elderly) ; National Housing Act (FHA); School Survey and Construction Act; Hospital Survey and Construction Act ; Federal Alr. port Act; Federal Civil Defense Act of 1950 ; Federal Water Pollution Control Act; Delaware River Basin Compact; Health Professions Educational Assistance Act of 1963; Higher Education Facilities Act of 1963; Vocational Education Act of 1963; Mental Retardation Facilities and Community Mental Health Centers Construction Act of 1963; Airport and Airways Development Act of 1970 ; Postal Reorganization Act of 1970 : National Foundation on the Arts and Humanities Act ; Clean Waters Restoration Act of 1966 ; Assistance to Local Educational Agencies for Education of Children of Low-Income Familles ; School Construction in Areas Affected by Federal Activities : Model Secondary School for the Deaf; Partnership for Health Amendments; Medical Library Assistance Extension Act; Health Research Facilities Act; Nurse Training Act; Demonstration Cities and Metropolitan Development Act; Air Quality Act; High Speed Ground Transportation Act; Urban Mass Transportation Act; Alcoholic and Narcotics Rehabilitation Amendments ; Juvenile Delinquency Prevention and Control Act; Vocational Rehabilitation Act Amendments of 1968 ; Vocational Education Act of 1968; and Economic Opportunity Act of 1964.

WAGE RATES INCORPORATED IN CONTRACTS

The wage rates determined by the Secretary of Labor under the laws for each class of laborer or mechanic are made a part of the contract specifications such rates are minimum rates and the contractor may have to pay higher rates (at no increase in the contract price) if economic conditions so require. The schedule of wage rates determined by the Secretary of Labor must be posted by the contractor on the construction site and all laborers and mechanics working at the site must be paid their wages in full, without any unlawful deductions, at least once each week.

NATIONAL EMERGENCY

The President is authorized, in the event of a National Emergency,

a to suspend the provisions of the Davis-Bacon Act.

ENFORCEMENT

Enforcement of the laws is the duty of the Federal agency that makes the contract or furnishes Federal aid for the project. Under Reorganization Plan No. 14 of 1950, the Department of Labor has the legal duty to see that there is a coordinated and consistent enforcement of these laws by the responsible Federal agencies. Labor Department regulations provide what the contractors, subcontractors, and Federal agencies have to do.

PENALTIES

Regulations, Part 5, issued by the Secretary of Labor (29 CFR secs. 5.1–5.12a) provide that if the contractor or subcontractor fails to live up to any one of the contract provisions under the law, he has broken the contract and it may be cancelled and the work given to another contractor for completion. In addition, if a contractor has failed to pay required wages under these laws, the Federal Government may withhold or have withheld the full amount of any back wages due, from money that would otherwise be made available for payments to the contractor. Also, on written notice further payments or guarantees of funds may be suspended until violations have been corrected.

Contractors and subcontractors who disregard their obligations under any of these laws may be barred for a period of 3 years from receiving any further contracts to which the laws apply.

Miller Act

Act of Aug. 24, 1935, as amended, 40 U.S.C. 270 et seq.

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PERSONS AND EMPLOYMENTS COVERED

The Miller Act applies to every contract of over $2,000 for the construction, alteration, or repair of any public building or public work of the United States and provides that, before any contract covered by its provisions is awarded, the contractor must execute a payment bond with a surety or sureties to protect the wages of all persons supplying labor.

This law, while not a prevailing wage law or overtime pay law, is particularly important to laborers and mechanics who work on construction covered by the Davis-Bacon Act—that is, on construction contracts made directly by the Federal Government. Although the law does not apply to Federal-aid projects but only to direct Federal contracts, it is usual for Federal agencies administering grant-in-aid, loan, mortgage guarantee, and similar Federal-aid programs to require by regulation that contractors on construction under these programs execute a performance bond. Generally, the term of such bonds extends to 1 year after completion of the project.

RIGHT TO SUE

The Miller Act gives the worker a right to sue on the contractor's bond if he does not receive payment in full within 90 days after the day on which the last labor was performed. If the worker was employed by a subcontractor, he can sue the prime contractor and sureties on the bond for his unpaid wages, if he first gives written notice to the prime contractor within 90 days after the last labor was performed. This notice must be sent by registered mail, postage prepaid, in an envelope addressed to the contractor at any place he maintains an office or conducts his business; or it may be served in any other way that the U.S. marshal or the Federal district court for the district where the job is located is authorized to serve a summons.

TIME AND MANNER FOR BRINGING SUIT

Suits to recover under the Miller Act must be commenced with 1 year after the date of final settlement of the contract and must be brought in the name of the United States, for the use of the person suing, in the U.S. district court in any district in which the contract was to be performed and executed. Suit is brought and prosecuted by the worker's own attorney.

Text of Act

(Section Nos. refer to U.S. Code) 8 276a. Rate of wages for laborers and mechanics.

(a) The advertised specifications for every contract in excess of $2,000, to which the United States or the District of Columbia is a party, for construction, alteration, and/or repair, including painting and decorating, of public buildings or public works of the United States or the District of Columbia within the geographical limits of the States of the Union, or the District of Columbia, and which requires or involves the employment of mechanics and/or laborers shall contain a provision stating the minimum wages to be paid various classes of laborers and mechanics which shall be based upon the wages that will be determined by the Secretary of Labor to be prevailing for the corresponding classes of laborers and mechanics employed on projects of a character similar to the contract work in the city, town, village, or other civil subdivision of the State, in which the work is to be performed, or in the District of Columbia if the work is to be performed there; and every contract based upon these specifications shall contain a stipulation that the contractor or his subcontractor shall pay all mechanics and laborers employed directly upon the site of the work, unconditionally and not less often than once a week, and without subsequent deduction or rebate on any account, the full amounts accrued at time of payment computed at wage rates not less than those stated in the advertised specifications, regardless of any contractual relationship which may be alleged to exist between the contractor or subcontractor and such laborers and mechanics, and that the scale of wages to be paid shall be posted by the contractor in a prominent and easily accessible place at the site of the work; and the further stipulation that there may be withheld from the contractor so much of accrued payments as may be considered necessary by the contracting officer to pay to laborers and mechanics employed by the contractor or any subcontractor on the work the difference between the rates of wages required by the contract to be paid laborers and mechanics on the work and the rates of wages received by such laborers and mechanics and not refunded to the contractor, subcontractors, or their agents.

(b) As used in sections 276a to 276a-5 of this title the term "wages", "scale of wages", and "wage rates”, “minimum wages", and "prevailing wages" shall include

(1) the basic hourly rate of pay; and
(2) the amount of

(A) the rate of contribution irrevocably made by a contractor or subcontractor to a trustee or to a third person pursuant to a fund, plan, or program; and

(B) the rate of costs to the contractor or subcontractor which may be reasonably anticipated in providing benefits to laborers and mechanics pursuant to an enforcible commitment to carry out a financially responsible plan or program which was communi

cated in writing to the laborers and mechanics affected, for medical or hospital care, pensions on retirement or death, compensation for injuries or illness resulting from occupational activity, or insurance to provide any of the foregoing, for unemployment benefits. life insurance, disability and sickness insurance, or accident insurance, for vacation and holiday pay, for defraying costs of apprenticeship or other similar programs, or for other bona fide fringe benefits, but only where the contractor or subcontractor is not required by other Federal, State, or local law to provide any of such benefits: Provided, That the obligation of a contractor or subcontractor to make payment in accordance with the prevailing wage determinations of the Secretary of Labor, insofar as sections 276a to 276a-5 of this title and other Acts incorporating sections 276a to 276a-5 of this title by reference are concerned may be discharged by the making of payments in cash, by the making of contributions of a type referred to in paragraph (2) (A), or by the assumption of an enforcible commitment to bear the costs of a plan or program of a type referred to in paragraph (2)(B), or any combination thereof, where the aggregate of any such payments, contributions, and costs is not less than the rate of pay described in paragraph (1) plus the amount referred to in paragraph (2).

In determining the overtime pay to which the laborer or mechanic is entitled under any Federal law, his regular or basic hourly rate of pay (or other alternative rate upon which premium rate of overtime compensation is computed) shall be deemed to be the rate computed under paragraph (1), except that where the amount of payments, contributions, or costs incurred with respect to him exceeds the prevailing wage applicable to him under sections 276a to 276a-5 of this title, such regular or basic hourly rate of pay (or such other alternative rate) shall be arrived at by deducting from the amount of payments, contributions, or costs actually incurred with respect to him, the amount of contributions or costs of the types described in paragraph (2) actually incurred with respect to him, or the amount determined under paragraph (2) but not actually paid, whichever amount is the greater. (Mar. 3, 1931, ch. 411, $ 1,46 Stat. 1494; Aug. 30, 1935, ch. 825, 49 Stat. 1011; June 15, 1940, ch. 373, § 1, 54 Stat. 399; July 12, 1960, Pub. L. 86-624, $ 26, 74 Stat. 418; July 2, 1964, Pub. L. 88–349, $ 1,78 Stat. 238.) $ 276a-1. Termination of work on failure to pay agreed wages;

completion of work by Government. Every contract within the scope of sections 276a to 276a-5 of this title shall contain the further provision that in the event it is found by the contracting officer that any laborer or mechanic employed by the contractor or any subcontractor directly on the site of the work covered by the contract has been or is being paid a rate of wages less than the rate of wages required by the contract to be paid as aforesaid, the Government may, by written notice to the contractor, terminate his right to proceed with the work or such part of the work as to which there has been a failure to pay said required wages and to prosecute the work to completion by contract or otherwise, and the contractor and his sureties shall be liable to the Government for any excess costs occasioned the Government thereby. (Mar. 3, 1931, ch. 411, $ 2, as added Aug. 30, 1935, ch. 825, 49 Stat. 1011.) 8 276a-2. Payment of wages by Comptroller General from with

held payments; listing contractors violating contracts. (a) The Comptroller General of the United States is authorized and directed to pay directly to laborers and mechanics from any accrued payments withheld under the terms of the contract any wages found to be due laborers and mechanics pursuant to sections 276a to 276a-5 of this title; and the Comptroller General of the United States is further authorized and is directed to distribute a list to all departments of the Government giving the names of persons or firms whom he has found to have disregarded their obligations to employees and subcontractors. No contract shall be awarded to the persons or firms appearing on this list or to any firm, corporation, partnership, or association in which such persons or firms have an interest until three years have elapsed from the date of publication of the list containing the names of such persons or firms.

(b) If the accrued payments withheld under the terms of the contract, as aforesaid are insufficient to reimburse all the laborers and mechanics, with respect to whom there has been a failure to pay the wages required pursuant to sections 276a to 276a-5 of this title, such laborers and mechanics shall have the right of action and/or of intervention against the contractor and his sureties conferred by law upon persons furnishing labor or materials, and in such proceedings it shall be no defense that such laborers and mechanics accepted or agreed to

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