“It seemed to me that the federal Government should not engage in construction work in any state and undermine the labor conditions and the labor wages paid in that State… The least the federal Government can do is comply with the local standards of wages and labor prevailing in the locality where the building construction is to take place.”
— Rep. Robert L. Bacon (NY), U.S. Congress, 1927
August 14, 2023
On Tuesday, August 8th, 2023 Vice President Kamala Harris spoke in front of a crowd gathered at a union apprenticeship training hall in order to announce the publication of new rules for the 1931 Davis-Bacon Act. For the first time in 40 years the U.S. Department of Labor (DOL) is updating the rules that affect millions of workers on federally funded construction projects. This has been a long-sought priority of labor unions ever since the Reagan administration gutted the law in 1981-82. The Davis-Bacon Act is one of the most important laws for building trades unions in the United States.
In 1927, Representative Robert L. Bacon from New York introduced the first bill in Congress to establish prevailing wages (the average wage paid to similarly employed workers in a specific occupation in the area of intended employment) in construction. He did this in response to a government construction contract for a Veteran’s Bureau hospital on Long Island being let to a contractor from Alabama. This contractor brought a thousand non-union laborers to Long Island, housed them in shacks and paid them pennies on the dollar of what construction workers were paid in New York. To Representative Bacon, this seemed like the government undermining those local construction workers.
To others, like Samuel Gompers, President of the American Federation of Labor, this was just an extension of the work of labor to secure better working conditions for all workers. That skill and quality of work should determine what company succeeds and not how low they can pay workers or how many hours a day they can order their employees to work. The Davis-Bacon Act was born out of the fight for an 8-hour work day (The National Eight-Hour Day Act passed in 1868) and the idea that government should be leading the way in how workers are treated.
Today, as stated in the opening pages of the Final Rule:
“The Davis-Bacon Act and now more than 70 active Related Acts collectively apply to an estimated $217 billion in Federal and federally assisted construction spending per year and provide minimum wage rates for an estimated 1.2 million U.S. construction workers.”
The impact of these changes will be felt by not just construction workers but the economy generally. The Supreme Court has described the Davis-Bacon Act as “a minimum wage law designed for the benefit of construction workers.” United States v. Binghamton Constr. Co., 347 U.S. 171, 178 (1954). Some of these changes will raise that minimum wage almost immediately. The Vice President’s office said in a statement that this will mean “will mean thousands of extra dollars per year in workers’ pockets to help put a down payment on a home, save for retirement, or simply have more breathing room.”
A few highlights from the 812-page final rule include returning to the original way prevailing wages were determined, stronger enforcement measures including liability for the actions taken by subcontractors under the watch of general contractors, anti-retaliation measures, and methods to allow the U.S. Department of Labor to keep wages up-to-date. These rules also clarify that projects such as solar panels, wind turbines, electric vehicle charging stations, and broadband installation is considered construction if paid for by federal money covered by Davis-Bacon prevailing wages. This win is extra significant because the Inflation Reduction Act has prompted a boom in construction and public works. And every one of these projects has federal dollars. So workers on these many projects will benefit.
Today the Biden administration will announce a rule change that will effectively raise the minimum wage for more than 1 million construction workers.
— More Perfect Union (@MorePerfectUS) August 8, 2023
The change will restore a New Deal “prevailing wage” policy that was gutted by Ronald Reagan.
Thread.
In the coming weeks the exact details of how these rules will work and when they will be implemented (sometime in the next 60-90 days) will emerge. And while there will be challenges to these changes in court, the U.S. DOL has done a tremendous amount of work to craft strong, worker-centered, rules and has backed these decisions up with thoughtful and thorough justification. It has established that this administration, under the leadership of President Biden and Vice President Harris, is working on behalf of the working women and men of the United States.
Many comparisons have been made around the federal infrastructure spending and the New Deal of 1930s. It’s no coincidence that with these rules we are returning the Davis-Bacon Act of the 1930s and the rules first established by the great Secretary of Labor Frances Perkins under the leadership of President Roosevelt.
“Out of our first century of national life we evolved the ethical principle that it was not right or just that an honest and industrious man should live and die in misery. He was entitled to some degree of sympathy and security. Our conscience declared against the honest workman’s becoming a pauper, but our eyes told us that he very often did.”
–Secretary of Labor Frances Perkins, People at Work – 1934