DOL Updates Davis-Bacon/Prevailing Wage Rules, Exempts Concrete and Material Suppliers

Last week, the U.S. Department of Labor (DOL) published its long-awaited update to Davis-Bacon regulations, also known as prevailing wage rules on federally-assisted construction projects. DOL stated that the update is “the first comprehensive regulatory review in nearly 40 years, revisions to these regulations will promote compliance, provide appropriate and updated guidance, and enhance their usefulness in the modern economy.”

Luckily, the rewrite largely does not change how Davis-Bacon is applied to ready mixed concrete producers. At the urging of NRMCA and its sister associations, DOL agreed that “material suppliers,” such as concrete producers, will continue to not be covered under Davis-Bacon. However, DOL did clarify what a material supplier entails through adoption of a new definition. While the new rule and new definition will uphold how ready mixed concrete producers are classified, it does contain some new language.

The new definition specifically states that “an entity is a material supplier if: (a) its only obligations for work on the contract or project are the delivery of materials, articles, supplies or equipment, which may include pickup of the same in addition to, but not exclusive of, delivery and which may also include activities incidental to such delivery and pickup; and (b) its facility or facilities that manufactures the materials, articles, supplies, or equipment used for the contract or project (1) is not located on, or does not itself constitute, the project or contract’s primary or secondary construction site, and (2) either was established before opening of bids on the contract or project, or is not dedicated exclusively, or nearly so, to the performance of the contract or project. All other entities engaged in work on the site of the work are contractors or subcontractors.”

NRMCA, along with its sister associations and coalition groups, submitted numerous comments, met with DOL officals, the White House Office of Management and Budget (OMB) and the Small Business Administration in an effort to uphold material supplier exemptions, which ultimately succeeded. NRMCA also advocated for concrete plants that are erected on jobsites or are used primarily to supply a dedicated jobsite to no longer be covered under Davis-Bacon. Unfortunately, DOL rejected this argument and has instead chosen to retain and reassert such provisions in its rewrite.

The updated rule will become effective 60 days after it's published in the Federal Register, which is scheduled for August 23.

Click here to review the final rule, FAQs, a changes comparison chart and other resources. For more information, contact Kevin Walgenbach at kwalgenbach@nrmca.org.