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Contractor's Guide to the Construction Wage Rate Requirements Statute (fka Davis-Bacon Act) (July 2018)
SECNAVINST 4200.36A assigns the Naval Facilities Engineering Command the responsibility for preparing and maintaining contractor industrial relations policy and procedures on contracts with construction requirements. This document provides compliance guidance to Naval Facilities Engineering Command contractors on various labor requirements, with emphasis on the Construction Wage Rate Requirements statute formerly known as the Davis-Bacon Act. It supports the Department of the Navy policy that proper and consistent implementation of labor standards in Department of the Navy contracts promote good business and effective contracting in terms of price, quality, speed of delivery, customer satisfaction and mission success.
The information provided in this guide does not substitute for full and careful review of the contract and all applicable statutes and regulations, such as the Federal Acquisition Regulation (FAR) and its supplements and the U.S. Department of Labor (DOL) regulations related to these issues. If there is any conflict between those requirements and this guide, the statutes and regulations applicable at the time of contract award will apply.
There are three chapters in this Guide. The first chapter provides a brief overview of the statutes and regulations pertaining to Federal labor standards on construction contracts. The second chapter provides guidance on the contractor’s responsibilities with regard to compliance with labor standards and payroll reporting requirements. The third chapter discusses procedures for compliance issues that are not resolved with contracting agency administration and enforcement.
Questions pertaining to a solicitation or contract should be directed to the contacting officer.
Questions about the content of this Guide should be directed to
the NAVFAC Command Labor Advisor
POSITIVE LAW CODIFICATION
The Positive Law Codification is a process that is updating the historical titles of Acts. There are no substantive changes to the statutes, only terminology revisions. The Federal Acquisition Regulations (FAR) and the Department of Defense Federal Acquisition Regulation Supplement (DFARS) have already incorporated these changes.
The following Positive Law Codification changes affect this guide:
· The Davis-Bacon Act will be referred to as the “Construction Wage Rate Requirements statute”
· The Contract Work Hours Standards Safety Act will be referred to as “Contract Work Hours and Safety Standards statute”
· The Service Contract Act will be referred to as the “Service Contract Labor Standards statute”
Note: Many other reference materials and websites, including U.S. Department of Labor, WDOL.gov soon to be SAM.gov, Code of Federal Regulations, etc. have not been updated to include the Positive Law Codification changes.
TABLE OF CONTENTS
POSITIVE LAW CODIFICATION 2
TABLE OF CONTENTS 3
CHAPTER 1. LAWS, REGULATIONS, CONTRACTS AND RESPONSIBILITIES 6
1-1 CONSTRUCTION WAGE RATE REQUIREMENTS STATUTE AND OTHER LABOR LAWS (FAR 22.4)6 a. Construction Wage Rate Requirements Statute. 6 b. Contract Work Hours and Safety Standards Statute. 6 c. Copeland Act. 6 d. Fair Labor Standards Act. 6 e. Executive Order 13658, Establishing a Minimum Wage for Contractors. 7 f. Executive Order 13706, Establishing Paid Sick Leave for Federal Contractors. 7 1-2 CONSTRUCTION WAGE RATE REQUIREMENTS STATUTE REGULATIONS 7 1-3 CONSTRUCTION CONTRACT LABOR PROVISIONS 8 a. The Labor Standards Clauses (FAR 22.407). 8 b. Construction Wage Rate Requirements Statute Wage Determinations (FAR 22.404). 8 1-4 RESPONSIBILITY OF THE PRIME CONTRACTOR 8 1-5 RESPONSIBILITY OF THE CONTRACTING OFFICER (FAR 1.602-1 & 2, FAR 22.406-1 through 22.406-12) 9
CHAPTER 2. COMPLYING WITH LABOR STANDARDS AND PAYROLL REPORTING REQUIREMENTS 10
SECTION I – DEFINITIONS AND REQUIREMENTS 10
2-1 CONSTRUCTION WAGE RATE REQUIREMENTS STATUTE DEFINITIONS (FAR 22.401) 10 a. Laborer or Mechanic. 10 1) Working Foremen. 10 2) White Collar Employees. 10 b. Apprentices. 10 c. Site of Work. 10 2-2 WAGE DETERMINATION/POSTINGS 11 a. Work Classifications and Rates. 11 b. Postings (FAR 22.404-10). 12 c. Equal Employment Opportunity (EEO) Requirements. 12 2-3 CONSTRUCTION WAGE RATE REQUIREMENTS STATUTE - BASIC COMPLIANCE REQUIREMENTS (FAR 22.406-2) 12 a. Basic Wage/Benefit Requirements (FAR Contract Clause 52.222-6 Construction Wage Rate Requirements). 12 b. Apprentices/Trainees Rates (FAR Contract Clause 52.222-9 Apprentices and Trainees). 12 1) Probationary Apprentice. 13 2) Pre-Apprentice. 13 3) Ratio of Apprentices-to-Journeymen. 13 4) Fringe Benefits for Apprentices. 13 c. Prevailing Wage Rates. 13 d. Fringe Benefits. 14 1) Fringe Benefits into Bona Fide Plans. 14 2) Fringe Benefits in Cash. 14 3) Fringe Benefits are Applicable to All Hours Worked. 14 4) Benefits Required by Federal, State or Local Laws. 14 5) Business Expense - Not a Fringe Benefit. 14 6) Ineligible Employees. 15 7) Annualization of Fringe Benefit Contributions. 15 8) Fringe Benefits Expressed as a Percentage. 15 e. Site of Work. 15 f. Overtime. 15 g. Deductions. 15 h. Piecework. 16 i. Proper Classification of Workers. 16 1) Jurisdiction. 16 2) Employees Performing Work in Multiple Classifications. 17 2-4 ADDITIONAL CLASSIFICATIONS AND RATES – CONFORMANCES (FAR 22.406-3) 17 a. Additional Classification Rules (FAR 22.406-3). 17 b. Making the Request (FAR 22.406-3(a)). 18 c. Employees’ Review (FAR 22.406-3(c)). 18 d. NAVFAC Review (FAR 22.406-3(b)). 18 e. DOL Decision (FAR 22.406-3(d)). 19 2-5 CERTIFIED PAYROLL REPORTS (FAR 22.406-6 and FAR Contract Clause 52.222-8 Payrolls and Basic Records). 19 a. Payroll Formats. 19 b. Payroll Certifications (FAR 22.406-6(a)). 19 c. No Work Payrolls. 20 d. Payroll Review and Submission (FAR 22.406-6(a)). 20 e. Independent Subcontractors. 20 f. Bona Fide Business Owners. 20 g. Owner/Operators of Trucks. 21 h. Truck Drivers. 21 i. Payroll Retention (FAR 22.406-6(d)). 21 j. Payroll Inspection (FAR 22.406-6(d)). 21 SECTION II – REPORTING REQUIREMENTS 21 2-6 COMPLETING A CERTIFIED PAYROLL (29 CFR 5.5(a)(3) and FAR Contract Clause 52.222-8 Payrolls and Basic Records) 21 a. Project and Contractor or Subcontractor Information. 22 b. Payroll No. 22 c. Employee Information. 22 d. Work Classification. 22 1) Apprentices (FAR Contract Clause 52.222-9 Apprentices and Trainees). 22 2) Multiple Classifications. 23 e. Hours Worked. 23 f. Rate of Pay. 23 g. Piecework. 23 h. Gross Wages Earned. 24 i. Deductions. 24 j. Net Pay. 24 k. Statement of Compliance. 24 l. Signature. 25 m. Electronic Signature. 25 n. Electronic Payrolls. 25 SECTION III – PAYROLL REVIEWS AND CORRECTIONS 26 2-7 COMPLIANCE CHECKS AND INVESTIGATIONS (FAR 22.406-7) 26 a. Project Payroll Reviews. 26 b. On-Site Interviews (FAR Contract Clause 52.222-8(c)). 26 c. Regular Compliance Checks. 26 2-8 TYPICAL PAYROLL ERRORS AND REQUIRED CORRECTIONS 26 a. Incomplete Payroll Information. 26 b. Classifications. 27 c. Wage Rates. 27 d. Apprentices. 27 e. Overtime. 27 f. Deductions. 28 g. Fringe Benefits. 28 h. Signature. 28 2-9 VIOLATION INDICATORS AND OTHER REVIEWS 28 2-10 RESTITUTION FOR UNDERPAYMENT OF WAGES 28 a. Notification to the Prime Contractor (FAR 22.406-8(c)). 28 b. Computing Restitution. 29 c. Corrected Payrolls. 29 d. Evidence of Receipt. 29 e. Review of Corrected Payrolls. 29 f. Workers Who Cannot Be Located Who Are Still Due Back Wages. 29
CHAPTER 3. LABOR DISCREPANCIES, ADMINISTRATIVE REVIEWS, WITHHOLDING, DISPOSITION OF WITHHELD FUNDS, SANCTIONS, CONTRACT TERMINATION AND DEBARMENT 31
3-1 LABOR DISCREPANCIES AND ADMINISTRATIVE REVIEWS (FAR 22.406-10) 31 a. Labor Discrepancies. 31 b. Findings of Underpayment. 31 c. U.S. Department of Labor Review. 31 d. Administrative Review Board. 32 3-2 WITHHOLDING (FAR 22.406-9) 32 3-3 DISPOSITION OF WITHHELD FUNDS (FAR 22.406-9(c)) 32 a. If the Parties Agree. 32 b. If the Parties Disagree. 33 3-4 DEBARMENT (FAR 22.406-10(f)) 33 3-5 FALSIFICATION OF CERTIFIED PAYROLLS (FAR 52-222-8(b)(4)) 33 3-6 COPELAND ACT (29 CFR 3, 18 U.S.C. 874, FAR 52.222-10) 33 3-7 CONTRACT TERMINATION (FAR 52.222-12) 33
ATTACHMENTS 35 WH-347 Payroll Form(Pages 36-37) 35 WH-347 Instructions(Pages 38-39) 35 DD-879, Statement of Compliance and Instructions(Pages 40-41) 35 SF-1413, Statement and Acknowledgment(Page 42) 35 Instructions for Completing Statement and Acknowledgment Form, SF-1413(Page 43) 35 SF-1444, Request for Authorization of Additional Classification and Rate(Page 44) 35 Employee Rights Under the Davis-Bacon Act Poster(Page 45) 35 Equal Employment Opportunity is The Law Poster(Pages 46-47) 35 EEO is The Law Poster Supplement(Page 48) 35 Pay Transparency Nondiscrimination Provision Poster(Page 49) 35 Worker Rights Under Executive Order 13706 Paid Sick Leave Poster(Page 50) 35 Worker Rights Under Executive Order 13658 Federal Minimum Wage Poster(Page 51) 35
CHAPTER 1. LAWS, REGULATIONS, CONTRACTS AND RESPONSIBILITIES
The following paragraphs briefly outline the contract labor standards statutes and regulations and what they require on Naval Facilities Engineering Command (NAVFAC) contracts:
1-1 CONSTRUCTION WAGE RATE REQUIREMENTS STATUTE AND OTHER LABOR LAWS (FAR 22.4)
a. Construction Wage Rate Requirements Statute. The Construction Wage Rate Requirements statute requires the payment of prevailing wages and fringe benefits, as determined by the U.S. Department of Labor (DOL), to all laborers and mechanics working on the site of federal government constr