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Homes and Community Renewal

ARRA Funded Weatherization Assistance Program
Frequently Asked Davis-Bacon Questions and Answers

For further information from the U.S. Department of Energy (DOE) on Davis-Bacon Act Compliance: DOE's Frequently Asked Davis-Bacon Questions and Answers

Questions on Davis-Bacon related to Weatherization can be directed to WAPDavisBacon@nyshcr.org


Who is covered? When does DBA apply?

Question: How will Davis Bacon requirements effect the execution of my weatherization contract? - Recently added

Answer: The American Recovery and Reinvestment Act (ARRA) requires that Davis Bacon wage rates be used for all projects receiving ARRA funding. Although Davis Bacon compliance has been required for large federally funded projects for decades this is the first time that it has been made a requirement for small weatherization projects. DHCR is fully aware that this new Davis Bacon requirement presents an additional challenge for subgrantees to establish and maintain the high production rates necessary to complete the large contracts funded this year by ARRA. In response to this challenge, DHCR has endeavored to take all steps necessary to minimize any adverse impacts to the subgrantees capacity to weatherize units that might result from addressing Davis Bacon compliance requirements. Therefore, the Davis Bacon compliance procedures developed by DHCR, which were a result of discussions between DHCR, the Federal Departments of Energy (DOE) and Labor (DOL), were formulated with the weatherization subgrantees productivity in mind. Consequently, the procedures required by DHCR are the simplest and most expeditious needed to comply with Davis Bacon requirements.

Question: Our agency (except senior supervisory & upper management staff) is governed by a collective bargaining agreement. I've been told that the Davis-Bacon Act doesn't apply to union shops. Can you verify this?

Answer: There is no general exception to the Davis-Bacon Act for union shops. Note that the Act mandates both (i) a minimum hourly wage and fringe benefit rate, and (ii) reporting and recordkeeping requirements -- an employer must comply with both aspects of the Act. Nevertheless, since the Act's hourly wage and fringe benefit requirements represent a minimum rate of pay, if your union wage and fringe benefit rates are found to exceed the relevant Davis-Bacon wage and fringe benefit rates for your area, your current wage and fringe benefit rates could remain in effect.

Question: For our sub-contractors, we have been told that "owner/operators" are not required to pay themselves prevailing wage. Therefore, if a contractor bids on furnace work and the owner is working on the job they would not be required to pay prevailing wages to themselves, only to their employees. Is this correct?

Answer: Owner-operators are covered by Davis-Bacon for all hours during which they perform the work of laborers or mechanics unless they are considered "exempt" (i.e., executive, administrative or professional) under the Fair Labor Standards Act.

Question: We plan to utilize subcontractors for all WAP labor in the field, except for our auditor. As a precaution, we have been asked to include our own crew members in the ARRA/WAP contract budget at 10%, in the event there is a need to use them because of sub-contractor issues.

It is our understanding that Davis-Bacon rules will not apply to our crew unless we actually use their labor in the ARRA contract. Is this accurate?

Answer: The subgrantee's employees are covered by Davis-Bacon only if and when they perform the work of laborers and mechanics. Therefore, based on the circumstances you describe in your question, your conclusion appears to be accurate.

Question: Can you please confirm whether our staff (weatherization crews employed by an agency of county government) is subject to DBA prevailing wage requirements.

Answer: Where a government agency uses its own employees to perform the work required by its ARRA weatherization grant, Davis-Bacon Act requirements are inapplicable.


Wage Rate Calculation

Question: How do we calculate the fringe benefit portion of the prevailing wage?

Answer: Fringe benefits may be paid by (a) cash, (b) an irrevocable contribution to a trustee or a third person under a fund, plan or program, or (c) an enforceable commitment to carry out a financially responsible plan or program that has been communicated in writing to the affected employees, or any combination thereof. In cases (b) and (c), the hourly fringe benefit equivalent is computed by dividing the amount of the contribution (e.g., quarterly) or the cost of providing the benefit (e.g., annual) by the total hours (both Davis-Bacon and other) worked by the employee during the relevant period. If that equivalent falls short of the prevailing hourly fringe benefit rate, the employer must make up the difference in cash.

Question: What types of fringe benefits can an employer include in its Davis-Bacon prevailing wage calculation?

Answer: The fringe benefits which may be included in satisfaction of Davis-Bacon obligations include medical or hospital care, pensions on retirement or death, compensation for injuries or illnesses resulting from occupational activity, or insurance to provide any of the foregoing, unemployment benefits, life insurance, disability and sickness insurance, or accident insurance, vacation and holiday pay, defraying the costs of apprenticeship or other similar programs, or other bona fide fringe benefits, but only where no other Federal, State or local law requires the employer to provide any of those benefits.

Question: Can we include our company's contributions for long- and short-term disability in our fringe benefit calculation for Davis-Bacon?

Answer: An employer may not take credit toward its Davis-Bacon fringe benefit obligations for payments or contributions that are required by Federal, State or local law. For instance, if the short term disability is the benefit mandated by the New York Disability Benefits Law, then the employer may not take credit for its payments or contributions in relation to that benefit. On the other hand, if either the long term disability or the short term disability you mention is not legally mandated, then the employer may take credit for its payments or contributions in relation to that benefit.

Question: When calculating fringe benefits for the WAP ARRA program, how do we account for our retirement benefit, which has a three year vesting schedule? Employees begin accruing the retirement on the first day of employment but they would not be entitled to the benefit unless they were employed at the agency for a three year period.

Answer: You must first confirm whether your pension plan satisfies the criteria established by the United States Department of Labor ("USDOL") for a "bona fide plan," pursuant to the Employee Retirement Income Security Act ("ERISA").

If so, you may credit the full amount of any pension plan contributions made on behalf of Davis-Bacon laborers and mechanics toward your agency's Davis-Bacon fringe benefit obligation. Note that any contributions which have been forfeited by an employee because they did not meet the plan's minimum vesting requirements do NOT revert to the employer but must be distributed among the remaining plan participants. For more detailed information on ERISA standards, please contact the USDOL's Employee Benefits Security Administration.

Question: I would like to know where to find the wage rates for buildings in NYC for the commercial rate structure?

Answer: Go to http://wdol.gov/dba.aspx and choose "BUILDING" from the "Construction Type" drop down menu (make sure that you've chosen "New York" and "New York" from State and County drop down menus - this covers all five boroughs). The website should have automatically listed "NY3" in the WD Number drop down menu. Hit Search. The site should show the most recently-issued General Wage Determination, containing wage and fringe benefit rates for all Construction types (including BUILDING, which encompasses commercial/multi-family buildings).


Pay Standards and Reporting Compliance

Question: For 1-4 story buildings is it required to confirm with DHCR what the wage rates and classifications are for each project? - Recently added

Answer: No, subgrantees will not have to contact DHCR to confirm wage rates for each residential project (1-4 story buildings) they weatherize. Subgrantees will use the wage rates for their counties that are listed on the Residential Weatherization Wage Rates that were attached to each contract.

Background: A major step designed to save subgrantees substantial time and effort in working with subcontractors, completing projects and complying with Davis Bacon was the creation by the Department of Labor of a special Weatherization Wage Classification for residential projects only. The classification sheet was given to each subgrantee to be included in their contract and used for 1-4 story projects only. The three classifications listed under the Weatherization Survey Wage Determination include Weatherization Worker, Doors and Window Replacement Worker and HVAC Heating and cooling worker. Additionally, the carpenter, electrician and plumber Davis Bacon rates are also listed for the each county. Therefore, in most cases for projects of 1-4 stories a subgrantee will simply use the rates listed on the Wage Determination. In the relatively few cases that residential projects require an additional wage classification the subgrantee will request a new wage determination using the same procedure that is required for buildings of more than 4 stories.

Question: If the Department of Labor updates the special residential wage schedule how will the subgrantees be informed of the change? - Recently added

Answer: DHCR will distribute any updated special residential Davis Bacon wage rates given to it by the Department of Labor to subgrantees. DHCR will inform subgrantees what date the new rates will be applicable. Wage rates for buildings of more than 4 stories in height will be listed on the DOL website.

Question: What is the general procedure for complying with Davis Bacon requirements for buildings of more than (4) stories in height? - Recently added

Answer: While subgrantees are able to use the special weatherization rates for 1-4 story weatherization projects without consulting with DHCR, buildings of more than four stories (4) in height must have wage rates for individual jobs approved by the contracting agency (DHCR). Projects of more than (4) stories must use the building/commercial rates for the geographical area (usually county) as found on the DOL website.

It is a Davis Bacon requirement that the designated Contracting Officer (DHCR) approve/confirm the wage rate classifications subgrantees have selected to be used in projects of more than four (4) story buildings. To expedite this process of confirmation and approval DHCR has developed a simple form- Request for Davis Bacon Wage Classification/Determination Buildings of More than Four Stories (posted on DHCR website) which subgrantees will fill out after going to the DOL wage determination site WagedeterminationsOn Line.gov (http://www.wdol.gov/) to identify the appropriate/latest wage determinations for the county where the project work site is located. The form will be e-mailed to the DHCR Davis Bacon Compliance Unit, which will quickly review the submission by checking the DOL website and respond (approve/confirm) by e-mail to the subgrantee.

Question: What happens when an additional wage classification is required? - Recently added

Answer: In instances where the subgrantee has determined that the DOL wage determination site does not list a job classification or classifications that will be required to complete the project, DOL requires that a formal request for an additional classification (s) be made to DOL through the Contracting Officer (DHCR). A DOL wage classification form (SF1444) will be on the DHCR website along with the website link to the DOL instructions for the form. The form is filled out by the subgrantee and sent to DHCR It is DHCR's responsibility as the contracting officer to review and forward the form to DOL. DOL has indicated that the request/approval turnaround time will be approximately (30) days from receipt by DOL. The subgrantee will be notified by DHCR of approval /disapproval or requests for additional information by DOL.

Question: How does and how often must a project report its Davis Bacon compliance? - Recently added

Answer: Subgrantees and their subcontractors must submit certified weekly payroll reports for each week in which ARRA funds were spent. Payroll reports are to be submitted to (Davis Bacon Compliance Unit (Division of Housing and Community Renewal Davis Bacon Certified Payroll Reporting Unit 25 Beaver Street, 7th Floor New York, NY 10004) as soon as possible after the payroll period ends. The payroll form (DOL-347) was supplied to all subgrantees previously and is on the DHCR website.

Question: When will DHCR transition to an electronic weekly payroll reports? - Recently added

Answer: DHCR has contracted with Elation Systems to provide a paperless web based electronic payroll reporting system. DHCR will begin transitioning to an electronic system for submitting payroll reports starting in February. The electronic system will enable subgrantees and subcontractors to submit weekly payroll reports to DHCR using a web based system. During the transitional period subgrantees will continue to submit weekly paper payroll reports. The system will allow subgrantees and subcontractors to upload their payroll information (pay rates and fringe benefits etc.) to the computer system. This feature will enable the system to automatically calculate the amount of fringe benefits and pay for Davis Bacon covered employees thereby saving the subgrantees, subcontractors and DHCR considerable time and effort in producing certified weekly payroll reports.

Question: If an employee's wages are paid partially with ARRA/WAP funds and partially from other sources, must that employee be paid every week, pursuant to Davis-Bacon Act requirements?

Answer: A laborer or mechanic covered by Davis-Bacon must be paid weekly even if he performs both Davis-Bacon and other work during the workweek. Moreover, the State's Labor Law requires weekly payment of wages to manual workers, including laborers and mechanics, except under limited circumstances as provided in NYS Labor Law, Section 191(1)(a)(ii).

Question: Under what circumstances is an employer required to pay overtime to an employee covered by the Davis-Bacon Act? Can those covered by Davis-Bacon work ten-hour days, as long as they don't exceed forty hours in a week (e.g., Mon-Thurs, 8AM to 6PM)?

Answer: The Contract Work Hours and Safety Standards Act ("CWHSSA") requires overtime payment, at one and one-half times an employee's regular hourly wage rate, for all hours worked in excess of forty hours in a workweek. The CWHSSA contains no daily overtime requirement; accordingly, a workweek of four ten-hour days would not require overtime compensation.

The CWHSSA applies to any work performed by mechanics or laborers with funds received from an ARRA/WAP grant contract greater than $100,000. However, if any such contracts do not meet this threshold, the Fair Labor Standards Act and the New York Labor Law would still require payment of overtime compensation (subject to any applicable exclusions and exemptions).

Question: I have a DOL form (PW 12) that one of our contractors supplied to us to report weekly payrolls. Is this the correct form? Do we submit the forms to DOL (or somewhere else) or do we just maintain them on file?

Answer: The PW-12 form is a NYSDOL form. The correct US DOL form is WH-347, available on the US DOL/ARRA website. The subgrantee must transmit the payroll report forms to DHCR.

Please be advised that the information you obtain from this FAQ is not intended to be, a formal agency order, opinion or legal advice. The Davis-Bacon Act is federal legislation and the New York State Division of Housing and Community Renewal has not been vested with the authority to render any such order, opinion or advice with respect to the Act.

Last updated on 2/8/10