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Glossary > Employment Law > Wage And Hour Laws > Payroll Practices
Legal Disclaimers

Davis-Bacon Act

The Davis-Bacon Act is a federal law that requires contractors and subcontractors working on federally funded construction projects to pay their laborers and mechanics at least the prevailing wage rates and fringe benefits as determined by the U.S. Department of Labor.

Example #1

For instance, if a construction company is hired to work on a federal building project, they must pay their workers the prevailing wage determined by the Department of Labor, which is typically higher than the minimum wage.

Misuse

A misuse of the Davis-Bacon Act could occur if a contractor intentionally pays their construction workers below the prevailing wage rates set by the Department of Labor to cut costs and increase profits. This undermines fair pay practices and exploits workers by denying them the wages they are entitled to.

Benefits

The Davis-Bacon Act benefits workers by ensuring they are paid fair wages that reflect the local standards for the type of work they are performing. This helps prevent undercutting of wages and promotes a level playing field for all workers on federally funded projects.

Conclusion

The Davis-Bacon Act plays a crucial role in protecting the rights of construction workers by ensuring they receive fair wages on federal projects, promoting economic stability for workers and their families.

Related Terms

Prevailing Wage LawFair Labor Standards Act (FLSA)

Last Modified: 4/30/2024
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