Issue Paper: Prevailing Wage
PREVAILING WAGE
The Davis Bacon Act, often called the Prevailing Wage Law, provides that whenever more than $2,000 in federal funds are used to build, repair, or alter public buildings, wages paid to workers on the construction project must be no less than the prevailing wages for that trade in the geographic area.
The Rhode Island “mini Davis-Bacon” law has similar provisions for state construction. The Department of Labor determines, and continually updates, the prevailing wage for various trades. These figures include contributions for health care and pension benefits.
In addition to protecting workers by establishing a wage floor, the law provides local builders with the opportunity to compete for government projects on the basis of skill and efficiency, rather than losing work to fly-by-night competitors who underbid by paying substandard wages.
In turn, government and taxpayers are protected from fly-by-night companies whose substandard wages and practices result in shoddy construction work and premature repair.
The Act was passed in 1931 when Rep. Robert Bacon (R-NY) and Sen. James Davis (R-PA) were alarmed by increasingly cutthroat bidding on federal contracts. Shoddy construction was considered a threat to a massive federal building program authorized by Congress.
AFL-CIO POSITION
The Rhode Island AFL-CIO strongly supports the Rhode Island Prevailing Wage law and the provisions it affords to workers, taxpayers, and members of the public who use publicly financed facilities or projects. The Rhode Island AFL-CIO supports more resources at the State level be committed to the enforcement of this law. In addition, the Rhode Island AFL-CIO also supports the provisions of the prevailing wage law be applicable on all projects utilizing any public funds, including but not limited to the state’s historic preservation tax credit program.
The Rhode Island AFL-CIO also strongly supports requiring any private entity that receives public funding to document the construction jobs created as a result of the funding, and the workers’ approximate wage and benefit rates.
