By Verne Waldow
Senior Investigator Advisor for the Department of Labor,
Wage-Hour Division, Retired
Sometimes Federal Agencies purposely omit the Wage Determination from the bid package and advise contractors to search for it on wdol.gov.
Sounds simple. But don't be fooled.
The Prevailing Wage Determinations Online website is filled with pitfalls that could negatively affect your contract profitability.
An example of this is the omission of the proper prevailing wage determination from the bid package.
Agencies are required to include the proper wage determination in a bid package so that contractors know what wages have to be paid before they bid on the contract.
But now, as a "cost saving measure", some agencies have directed contractors to go to a website, wdol.gov, and pick the proper wage determinations online for that project.
The unfortunate result has been that contracts are being let with incorrect wage rates. If the error isn't quickly caught, inevitably some of the wages are incorrectly paid and back wage liabilities may occur for the employer.
I remember getting a call from an employee who felt that welders were being underpaid for work at a government project.
When I went to the construction firm to investigate, I asked for a copy of the bid package which would contain the wage determination for the project.
When I found the wage determination, I discovered it was an SCA wage determination meant for Service Contracts, not a DBRA wage determination for a construction project.
When I asked the employer what his source was for the wage determination, he told me that he had been instructed by the contracting agency to go online and get it at the prevailing wage determinations online (wdol.gov) website.
He said that he had done his best to get the right wage determination, but had found the process very confusing.
The proper wage determination was obtained and the difference in wages calculated. Surprisingly there were no back wages due.
However ... I found that the employees had been overpaid by a total of $11,000!
There are factors to be considered that the average contractor does not know about (such as what the construction type is residential, building, heavy, or highway and the bid origination date, which is critical for determining the wage).
As mentioned above, it is the agency's responsibility to pick the proper wage determination. The contracting agent has the knowledge and ability to pick the right one.
Good documentation of your communication will help you to establish the facts in the event of a dispute.
Protect your hard-earned profits. Don't allow them be undermined by an incorrect wage determination that isn't your responsibility.
About the Author: Verne Waldow is a Senior Investigator Advisor for the Department of Labor, Wage-Hour division, Retired. For more than 30 years he worked for the US Dept. of Labor, specializing in investigations of Government Construction Contracts under the Davis Bacon Act (DBA) and the Davis Bacon and Related Act (DBRA). During the last two years of his employment he was promoted to Senior Investigator Advisor.
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