Davis-Bacon prevailing wage for contractors

What the statute requires, in our words

From 40 U.S.C. 3142:

• Which contracts. The bid specifications for a federal contract, in excess of $2,000 (the figure in the statute text), for construction, alteration or repair (including painting and decorating) of public buildings and public works, must state the minimum wages for each class of laborer and mechanic.
• Where the rates come from. The Secretary of Labor determines the wages prevailing for the corresponding classes of workers on similar projects in the local area. That document is the wage determination in the contract.
• Weekly pay. Workers employed directly on the site must be paid unconditionally, at least once a week, in full, without later deductions or rebates, at no less than the posted rates.
• Posting. The wage scale must be posted where workers can easily see it on site.
• Withholding. The contracting officer may hold back enough of the contractor's payments to cover any underpayment of workers, including a subcontractor's workers.

From 40 U.S.C. 3145, the Department of Labor's rules require each contractor and subcontractor to furnish a weekly statement of the wages paid to each employee. That weekly statement is what contractors call certified payroll. A false statement can be a federal crime. From 40 U.S.C. 3144, contractors found to have disregarded their obligations can be listed and barred from federal contracts for three years.

Base rate plus fringe

A wage determination lists, for each classification, a basic hourly rate and a fringe benefit amount. Under 40 U.S.C. 3141 and 3142, the contractor can meet the total by any mix of:

• cash wages
• contributions to bona fide benefit plans, such as health, pension, vacation or apprenticeship funds
• the reasonably expected cost of benefits under an enforceable plan communicated in writing to workers

What counts is that the total for each hour is at least the base rate plus the fringe. A contractor that pays no benefits pays the fringe amount in cash.

Classification matters

Workers are paid for the classification of the work they actually do, not their job title. A worker who spends part of the week as a laborer and part as an operator is paid each rate for the hours in each, if the payroll records the split. Without that record, the higher rate is a safe assumption for all hours. Apprentices may be paid less only when they are registered in a recognized apprenticeship program.

A worked weekly payroll with invented rates

These rates are invented for practice, not taken from any real wage determination. The classification pays a base rate of $38.50 and a fringe of $14.20 per hour. The contractor pays the fringe in cash. A worker puts in 44 hours, and overtime at 1.5 times applies to hours over 40 under the overtime law that covers the job.

Overtime on a prevailing wage job is figured on the base rate, not on the fringe (40 U.S.C. 3142(e) says the regular rate for overtime is the basic hourly rate, in our words). So:

• Straight time for all hours: 44 x 38.50 = $1,694.00
• Overtime premium, half the base rate on 4 hours: 4 x 19.25 = $77.00
• Fringe on all hours: 44 x 14.20 = $624.80
• Total for the week: 1,694.00 + 77.00 + 624.80 = $2,395.80

Check another way: the straight-time hours at the full package, 40 x 52.70 = 2,108.00, plus 4 overtime hours at (38.50 x 1.5) + 14.20 = 57.75 + 14.20 = 71.95, so 4 x 71.95 = 287.80, and 2,108.00 + 287.80 = 2,395.80.

A common error is to pay time and a half on the whole $52.70 package. That would give 4 x 79.05 = 316.20 for the overtime hours, $28.40 more than required. Check: 316.20 - 287.80 = 28.40, which is 4 hours x 14.20 x 0.5.

What it does to a bid

Prevailing wage rates are set by the wage determination, not by the contractor's usual pay scale. An estimator prices labor from the determination in the bid documents, adds payroll taxes and insurance on top (see contractor job costing and overhead), and allows office time for weekly certified payroll for itself and for checking each sub's. Subcontractors must be told the rates apply to them, because the prime contractor can be held responsible for a sub's underpayment.

Common mix-ups

• Paying the title, not the work. Classification follows the work performed.
• Overtime on the fringe. The premium is figured on the base rate.
• Monthly pay. The statute calls for at least weekly pay.
• Ignoring the subs. Their workers are covered too, and their payrolls are submitted.
• Assuming a state rule is the federal one. State prevailing wage laws have their own coverage, rates and paperwork.

On the NASCLA exam

The bulletin lists subject areas, not topics. We place payroll and labor law under Procurement and Contracting Requirements, 31 of the 115 scored questions. The NASCLA Contractors Guide to Business, Law and Project Management fits by its title. Expect the federal idea, not a state's rates.

Practice it

Read the Miller Act and Little Miller Acts for the bonds that come with the same federal jobs, and price burden on a wage in contractor job costing and overhead.

Take the free 10-question check

Start the free 10-question check. It is weighted to the twelve NASCLA subject areas, needs no signup and explains every answer, so you see which area to study first.

The NASCLA Commercial course has a lesson for each of the 12 subject areas that shows which listed reference to open and how to apply it, original practice questions with every answer worked, and four timed practice exams of 115 questions on a 330-minute clock. Your scores come back by subject area, so you know where the next study hour goes. See the course.

Not affiliated with or endorsed by NASCLA or PSI. NASCLA and PSI are named only to identify the exam and its test vendor.

Sources

Show the list

• 40 U.S.C. 3141, Definitions, Legal Information Institute. Retrieved 7 Nov 2026.
• 40 U.S.C. 3142, Rate of wages for laborers and mechanics, Legal Information Institute. Retrieved 7 Nov 2026.
• 40 U.S.C. 3144, Authority to pay wages and list contractors violating contracts, Legal Information Institute. Retrieved 7 Nov 2026.
• 40 U.S.C. 3145, Regulations governing contractors and subcontractors, Legal Information Institute. Retrieved 7 Nov 2026.
• PSI Candidate Information Bulletin 1458, content outline and reference list, updated 7 Jul 2026. Retrieved 5 Nov 2026.
• All rates are invented. Real rates come from the wage determination in each contract.