The Department of Labor (DOL) published a final rule on /august 23, 2023, that updates regulations under Davis-Bacon, a federal wage determination law. Effective October 23, the final rule represents the first comprehensive regulatory review of the federal wage determination law in nearly 40 years.

The Davis-Bacon Act applies to contractors and subcontractors performing work on federal (or D.C.) contracts. Davis-Bacon Act and Related Act contractors and subcontractors must pay their laborers and mechanics employed under the contract no less than the locally prevailing wages and fringe benefits for corresponding work on similar projects in the area. Under Davis-Bacon, the DOL is responsible for determining prevailing wages.

Provisions of the rule regarding wage determination methodology are applied only to wage determinations completed on or after October 23. For contracts that lock-in on or after the effective date, contractors will be impacted when analyzing internal controls, developing bids, and negotiating contract pricing.

According to a HUD press release, HUD’s Office of Multifamily Production is in the process of modifying the Form HUD-92554M, Supplement to Construction Contract, to incorporate the construction clauses, subject to OMB Paperwork Reduction Act approval.

HUD’s statement goes on to say that many of the amendments are regulatory changes that codify the DOL’s current practices. These changes may not practically impose new wage-related obligations on contractors, but HUD is moving forward with changes to the contract supplements.