Davis-Bacon Act Weekly Pay Compliance Options

Davis-Bacon Act Implementation and Compliance for Utilities

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The Davis-Bacon Act (DBA) requires that workers are paid weekly on DBA-covered projects; there is no compliance alternative to weekly payments, nor can workers waive their rights to be paid weekly. See more on the weekly pay requirement below.  

For award recipients whose employees are not on a weekly payroll schedule, DOE has outlined several possible options for meeting the DBA requirement.

This page only addresses compliance options relating to the weekly pay requirement. For information on other issues related to DBA compliance, please refer to the Department of Labor.

Note: The following is not legal advice. Please consult legal counsel to determine a suitable course of action.

For next steps, please contact your DOE point of contact (contracting officer, loan officer, etc.).

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Possible Options for DBA Weekly Pay Compliance

Modify payroll frequency in an existing system: Recipients may elect to modify the payroll frequency within their existing payroll systems to comply with weekly payment requirements for employees performing DBA-covered work. Most payroll systems allow for different pay frequencies for different workers.  See requirements below.

Utilize a supplemental system: Recipients may elect to seek the service of third-party weekly payroll service providers such Primepay, OnPay, Miter, Payroll4Construction, eBacon, eMars, ADP, or Paychex. (Note: DOE does not endorse any specific payroll services provider or product.)  Third party providers frequently handle direct deposit, the issuing of paper checks, or other wage payment methods for companies. For example, funds equivalent to the wages due could be placed in an account that workers can access through a payroll application. The workers must be able to obtain the full wage compensation due to them from the payroll app, payroll debit card, or similar method free and clear at a rate not less than the required prevailing wage on the required weekly pay date.  See requirements below.

Do not change payroll frequency of existing system but issue cash advances: Recipients maintain their pre-existing non-weekly payroll systems, but issue a cash advance in the alternate, non-traditional payment weeks in an amount equal to or exceeding the prevailing wages due to workers for their hours worked on DBA projects in the preceding week. The cash advance is then deducted from the non-weekly payroll amount. The remaining wages paid to the workers on the non-weekly payrolls must be sufficient to also cover the prevailing wage rate due to workers for any DBA hours worked during the second week of payroll, as well as the workers’ usual rate for their non-DBA work. See requirements below.

Do not change payroll frequency of existing system but issue checks: Recipients maintain their non-weekly payroll system and for workers that perform DBA work, they issue a “draw” check for a set amount in alternate weeks, which is subsequently deducted from/draws against the regular non-weekly payroll. The remaining wages paid to the workers on the non-weekly payrolls must be sufficient to also cover the prevailing wage rate due to workers for any DBA hours worked during the second week of payroll, as well as the workers’ usual rate for their non-DBA work. See requirements below.

 

  • The following requirements must be met to comply with the statutory DBA obligations.

    Weekly pay: Each laborer and mechanic performing DBA-covered work must receive each week no less than the minimum hourly wage and fringe benefits to which they are entitled under the applicable DBA wage determination(s) for each hour of covered work.

    Free and clear: The wages must be paid to the workers without discount or interest and in such a manner as to give the worker complete freedom of disposition of the advanced funds (i.e., the worker must receive the wages “free and clear,” with any additional costs incurred as a result of a third-party providing payroll services to be borne by the company and not passed on to the workers, either directly or indirectly). Note: Placing an equivalent amount of funds in an escrow or other account that the workers cannot access does not constitute unconditional payment to workers.

    No deductions: The recipient or third-party pay provider must not make any deductions from pay other than those that are expressly permissible (e.g., taxes) without application to or approval of the Secretary of Labor. 

    No reversion: Any monies deposited into a worker’s individual account pursuant to these requirements will not revert back to the recipient or the third-party pay provider under any circumstance (e.g., the monies will not revert if they are not accessed by the worker or the worker’s employment is terminated).

    No opt-in or opt-out: Workers cannot be required to either opt-in or opt-out of the weekly payment of prevailing wages, nor can they waive their rights to receive weekly payment.

    Sufficient to cover second week and no-offset: The recipient must ensure that the remaining wages paid to the workers on the non-weekly payrolls are sufficient to also cover the prevailing wage rate due to workers for any DBA hours worked during the second week of payroll (to the extent that the company chooses to pay prevailing wages due for the second week of payroll on the workers’ regular non-weekly payroll, rather than using the third-party pay provider to make prevailing wage payments in all work weeks), as well as the workers’ usual rate for their non-DBA work. The company also must not change a worker’s usual rate of pay in an attempt to “offset” the required DBA rate.

    Provide guidance: The recipient will provide workers with clear guidance regarding the manner in which they are being paid DBA prevailing wages and with clear instructions regarding the use and access to any individual account established by the company or its third-party for purpose of paying wages on DBA covered projects on a weekly basis. The recipient or third-party also will establish alternative procedures for any worker that is unable, due to disability or otherwise, to access the individual account.

    Recordkeeping: The recipient will comply with all recordkeeping requirements set forth in the DBA’s implementing regulations, including by creating and maintaining accurate records demonstrating the hours worked in each classification in each workweek and demonstrating that the payment, including cash advances or other payments in alternate workweeks, is for the purpose of paying those wages and is not for some other purpose. Note: Users of LCPtracker have access to certified payrolls.

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