What the Davis-Bacon Act is
The Davis-Bacon Act is a federal law, passed in 1931, that requires contractors and subcontractors on federally funded construction projects to pay their laborers and mechanics no less than the wages and fringe benefits that prevail locally for that kind of work.
It was written during the Great Depression, when contractors could win federal work by bringing in cheaper labor from outside the area and undercutting local wage levels. The Act removed that as a way to compete: on covered work, the local rate is the floor for everyone bidding.
Davis-Bacon requirements at a glance
| Requirement | What it means |
|---|---|
| Applies to | Federal and federally assisted construction, alteration or repair contracts over $2,000 |
| Who is covered | Laborers and mechanics performing work on the site |
| Pay floor | The prevailing wage for the classification: basic hourly rate plus fringe benefits |
| Where the rate comes from | The wage determination named in the contract, published on SAM.gov |
| Pay frequency | Weekly |
| Reporting | Weekly certified payroll with a signed Statement of Compliance |
| On site | The applicable wage determination and the Davis-Bacon poster displayed where workers can see them |
| Enforced by | The U.S. Department of Labor, Wage and Hour Division |
Davis-Bacon and the Related Acts
You will often see it written as the Davis-Bacon and Related Acts, or DBRA. The distinction matters more than it looks:
- The Davis-Bacon Act itself covers contracts where a federal agency is directly contracting for construction
- The Related Acts extend the same wage requirements to projects that are federally assisted rather than federally contracted, through grants, loans, loan guarantees or insurance
That second category is why plenty of contractors end up covered on what looks like a local school, housing or water project. The money passed through a federal program, so the wage rules came with it.
Prevailing wage vs Davis-Bacon: what is the difference?
Contractors use the two terms interchangeably, but they are not the same thing:
- Prevailing wage is the concept: a legally required minimum rate for a trade in a place. Many states have their own prevailing wage laws that have nothing to do with federal funding.
- Davis-Bacon is the specific federal law that applies prevailing wage rules to federally funded construction.
So all Davis-Bacon work involves prevailing wages, but not all prevailing wage work is Davis-Bacon. On a project covered by both a state law and Davis-Bacon, you generally have to meet whichever requirement is higher, and file under both systems.
Davis-Bacon and state prevailing wage laws
Davis-Bacon is not the only prevailing wage rule a contractor runs into. Roughly 30 states have their own prevailing wage laws, often called "little Davis-Bacon" laws because they apply the same idea to state-funded construction.
- These laws set their own contract thresholds, and they are frequently different from the federal $2,000
- They publish their own rate schedules, on their own cadence, separate from the federal wage determination
- They usually require their own reporting format, so a federal WH-347 does not discharge the state obligation
- Some states have no prevailing wage law at all, and a few repealed theirs, so coverage genuinely depends on where the project sits
Where both sets of laws apply to the same project, contractors have to meet the higher rate and file under both systems. Nothing on a federal wage determination tells you what a state requires, which state laws apply is a separate question you have to answer per project. The state compliance overview covers which states have their own law on top of Davis-Bacon.
How the prevailing wage is actually set
The Department of Labor surveys wages paid on similar projects in the area, then applies a three-step test to each classification:
- If a majority (more than 50 percent) of workers in that classification are paid the same rate, that rate prevails
- If not, the rate paid to the greatest number of workers prevails, as long as that group is at least 30 percent of those employed in the classification
- If no rate reaches 30 percent, the prevailing wage is the weighted average of all wages paid in that classification
The result is published as a wage determination, listing each classification with its base rate and fringe amount for a specific county and construction type.
The rate on the determination is a floor, not a schedule. Base rate and fringe are interchangeable in the sense that the combined package has to meet the total, but the base rate portion cannot be shorted by overpaying fringe.
What changed in 2023
On August 23, 2023, the Department of Labor issued a final rule updating the Davis-Bacon regulations, effective October 23, 2023. It was the first significant overhaul since 1982.
The headline change was restoring the 30 percent rule described above. Between 1982 and 2023, if no rate was paid to an outright majority, the determination went straight to a weighted average. Reinstating the 30 percent step means a rate held by a substantial minority can now prevail again, which in practice tends to produce higher determinations in areas with a strong union presence.
Where to find Davis-Bacon rates
Rates are not a single national table. They are published per wage determination, each covering a county (or group of counties) and one of four construction types: building, residential, heavy or highway.
Each contractor works from the wage determination named in their contract. You can look up any determination and see every classification, base rate and fringe with the free wage determination lookup, and how to read a wage determination walks through one line by line.
What Davis-Bacon obliges you to do
- Pay at least the determination rate for the classification of work actually performed, counting base pay and fringe benefits together
- Pay weekly
- Pay overtime at one and a half times the basic rate past 40 hours in a week, under the Contract Work Hours and Safety Standards Act
- File weekly certified payroll with a signed Statement of Compliance
- Classify workers by the work performed on the project, not by job title, and split the hours when someone works in more than one classification
- Post the wage determination and Davis-Bacon poster on site
- Keep records for three years after the prime contract closes out
The reporting side is covered in detail on what certified payroll is, and the classification side in wage classifications and apprentice rates.
What happens when you get it wrong
- Contract funds withheld to cover back wages and liquidated damages
- Debarment for three years from bidding on government work, for disregarding obligations: false payroll records, wage kickbacks, or repeated violations
In practice, most findings are not fraud. They come from a report checked against the wrong determination, the wrong classification, or a modification that changed partway through the job. The mistakes that come up most are nearly all of that kind.
Frequently asked
Does Davis-Bacon apply to private construction?+
No, not on its own. It attaches to federal contracts and to federally assisted projects through the Related Acts. A purely private job is only covered if the contract itself imposes the requirement.
Is the $2,000 threshold per worker or per contract?+
Per contract. It refers to the value of the construction contract, not to what any individual worker earns, and $2,000 is low enough that most covered projects clear it easily.
Are salaried employees covered?+
Coverage follows the work, not the pay arrangement. Laborers and mechanics performing covered work on site are covered regardless of how they are otherwise paid. Bona fide executive, administrative and professional staff are not.
Can fringe benefits be paid as cash?+
Yes. Fringe can go into bona fide plans, be paid as cash, or be split between the two, as long as base pay plus fringe meets the determination and it is reported correctly.
Who decides which wage determination applies to my job?+
The contracting agency, when it writes the contract. The determination and its modification number are named in the contract documents, and that is the version you owe, not necessarily the newest one published since.