October 2004
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Revisiting Davis-Bacon

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by Paul Greenberg
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The Davis-Bacon Act requires employers to provide minimum wage and fringe benefits to workers on federal government construction projects. Even though the act applies only to direct contracts between contractors and the federal or Washington, D.C., governments, Congress frequently includes prevailing-wage requirements in laws that fund a wide variety of state and local projects through federal grants or loan guarantees, such as highways, airports, public housing and water-treatment facilities. Following is detailed information about the act and how it affects you and your workers.

History

The Davis-Bacon Act was enacted in 1931 near the close of the Hoover presidency with two Republican legislators as its lead sponsors: Sen. James Davis of Pennsylvania and Rep. Robert Bacon of New York. The law had the twin goals of protecting workers from the corrosive effects of wage competition and protecting the business interests of local construction contractors from out-of-town competitors that had lower labor costs. Because federal government construction contracts traditionally have been awarded to the lowest-priced responsive and responsible contractor, unrestrained competition can result in contract awards to a bidder who cuts wages to the greatest extent possible. Left unchecked, this kind of wage competition can produce a deflationary "race to the bottom" of the wage scale.

Legislation to repeal the Davis-Bacon Act is introduced during almost every session of Congress, yet the law has proved to be remarkably resilient with support that has cut across traditional party and ideological lines for...



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