What Is the Davis-Bacon Act? A Complete Guide
Jun 24, 2025
The Davis-Bacon Act (40 U.S.C. §§ 3141–3148) is one of the most important — and often misunderstood — labor laws governing federal construction contracts. Enacted in 1931, it requires contractors and subcontractors working on federally funded construction projects worth $2,000 or more to pay workers at least the locally prevailing wage for the type of work they perform.
Who Must Comply?
Davis-Bacon applies to prime contractors working directly with the federal government, and all subcontractors on covered prime contracts — regardless of the subcontract amount. If the prime contract is covered, every sub is covered.
What Work Is Covered?
The law covers four construction types: building (offices, schools), heavy (dams, water treatment), highway (roads, runways), and residential (homes, small apartments). Each type has separate wage determinations.
How Are Prevailing Wages Set?
The Department of Labor Wage and Hour Division surveys employers in each county and sets prevailing wages for each trade classification. Rates are published as wage determinations (WDs) — official documents incorporated into federal contracts.