The Davis-Bacon Act (DBA), passed into law in 1931, requires that contractors must pay no less than the prevailing wage on publicly funded construction projects. The DBA also encourages fair market competition by encouraging investment in training; protects communities and workers from allowing out-of-area contractors to underbid local wage levels, or the “prevailing wage”; and helps to build a healthy middle class. The “prevailing wage” is set by the U.S. Department of Labor by surveying each construction market in a given area and determining the average hourly wage. Where union market share is high, the prevailing wage will reflect the union wage. Many Republican lawmakers on the federal level are looking to roll back the Davis-Bacon law and it’s up to us to fight hard to ensure this doesn’t happen.
1099 Misclassification/Payroll Fraud:
Misclassification is when construction contractors call their workers independent contractors to avoid paying taxes, insurance costs and payroll deductions. This exploitation hurts workers, honest and law-abiding businesses and the U.S. taxpayer, as the employer avoids paying any Social Security or Medicare, workers compensation, unemployment insurance or overtime and cheats the government out of tax revenue.
Misclassification occurs in all 50 states on residential, commercial, and public construction projects of all sizes. 1099 fraud is construction’s “dirty secret” and honest constructors haven’t been able to stop it. Our leaders and staff have been active in educating elected officials in state and local government on the injustices of payroll fraud. Our goal is to create a level playing field for law-abiding contractors and to prevent law breakers from robbing communities of valuable tax revenue.
Project Labor Agreements:
A project labor agreement (PLA) is an agreement that defines wages and work rules for a project. All PLAs must be approved by both labor and the awarding public body before any project can begin. PLA’s have been used for successful project construction on public projects and are used by private companies to increase quality construction and cost-effectiveness. The purpose of a PLA is to ensure that all construction work is performed efficiently and economically without interruption. Your involvement as an elected official can go a long way to getting PLAs signed with our signatory contractors.