‘Another promise kept by President Biden’

Organized labor hails DOL move to restore prevailing wage standards

WASHINGTON, D.C. (Aug. 11, 2023) — The reviews are in. The Biden Administration announced this week that the Labor Department (DOL) will update federal prevailing wage standards for the first time in decades, resulting in thousands of extra dollars per year in workers’ paychecks. The new DOL rule is being hailed by labor leaders as a major win for working families and “another promise kept by President Joe Biden.”

“This rule will guarantee that workers in new and existing jobs, emerging infrastructure, and clean energy sectors are paid fairly,” said AFL-CIO President Liz Shuler. “Every job created through these historic investments should be a good family-supporting job. That’s how we rebuild America from the bottom up and middle out. We’ll continue to partner with the Biden-Harris administration to transform our economy through a workers first agenda that lifts up families and communities across the nation.”

Vice President Kamala Harris announces the prevailing wage rule update on Aug. 8 at a union hall in Philadelphia. (Via Twitter @VP)

The DOL rule will update Davis-Bacon and Related Acts, which require payment of locally prevailing wages and fringe benefits to more than one million construction workers who are delivering $200 billion of federally funded or assisted construction projects. Those numbers will continue to grow given that nearly all of the significant construction programs contained in President Biden’s Bipartisan Infrastructure Law, CHIPS and Science Act, and Inflation Reduction Act require or strongly incentivize the use of Davis-Bacon prevailing wages.

According to a White House fact sheet on the change:

“(The new rule) restores the DOL’s definition of ‘prevailing wage’ used for nearly 50 years before it was upended by the Reagan administration. It will make the prevailing wage equivalent to the wage paid to at least 30% of workers, rather than 50% of workers, in a given trade in a locality. Prior to the new rule, if the majority of workers in a given trade and locality did not earn a single wage rate, then the prevailing wage was determined by the average wage in a given trade in a locality. This average can pull down the prevailing wage if some employers pay very little. Setting the prevailing wage to the wage paid to at least 30% of workers makes it more likely that workers are paid a true prevailing wage.”

Labor leaders universally praised the Biden Administration’s move.

Iron Workers General President Eric Dean said: “The Iron Workers loudly applaud the Biden-Harris administration’s new Davis-Bacon prevailing wage rule. Prevailing wage is a powerful tool to help local workers and businesses benefit from federal construction spending, which is why it attracts bipartisan support. However, past rulemakings had gutted the law. The new rule restores Davis-Bacon and is another promise kept by President Joe Biden.”

IUPAT General President Jimmy Williams, Jr. said: “This change is arguably the most significant and impactful to our pay in the trades in over 40 years and it reverses the Reagan era rule that redefined prevailing wage to help bosses, not workers. The updated rule will also benefit workers in our trades who need it the most – workers across the South who are paid less, exploited more and often at the complete mercy of their employers.”

IBEW International President Kenneth W. Cooper said: “The final rule reverses Reagan-era changes that weakened the law’s original intent – ensuring that federally funded or assisted projects support good-paying local jobs for local workers. For the past 40 years, a single low-wage contractor could depress wage rates on federal contracts. This rule change will allow construction workers to gain ground they lost in the 1980s, increasing the wages of millions and preventing low-road contractors from undercutting the workforce.”

Teamsters General President Sean M. O’Brien said: “The methods for determining prevailing wage rates never should have been modified in the first place, so we commend Secretary Su and the Biden-Harris administration for doing right by working-class communities. The workers on these jobs are responsible for re-building our country. They are patriots and deserve to be rewarded for their service.”

BREAKING NEWS: A groundbreaking victory for UA members from @USDOL today. This update to the Davis-Bacon prevailing wage protections means our members are poised for a brighter, more secure future with fair wages. pic.twitter.com/Q5WBzoWnlB

— United Association (@UAPipeTrades) August 8, 2023

SMART General President Michael Coleman said: “This is an administration that understands the importance of putting working families first. The gutting of the Davis-Bacon Act under the Reagan administration set us back for decades – now, with this long-overdue update, we can finally ensure that the women and men building our nation receive fair compensation.”

LIUNA General President Brent Booker said: “LIUNA members look forward to the implementation of the new rules and helping the Administration in their continued efforts to ensure that public investment creates good, family-supporting jobs.”