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Barry McVay's FEDERAL CONTRACTS DISPATCH

DATE: November 20, 2000

FROM: Barry McVay, CPCM

SUBJECT: Department of Labor; Labor Standards Provisions Applicable to Helpers on Federally Financed and Assisted Construction Contracts

SOURCE: Federal Register, November 20, 2000, Vol. 65, No. 224, page 69674

AGENCIES: Department of Labor (DOL), Employment Standards Administration, Wage and Hour Division

ACTION: Final Rule

SYNOPSIS: After 18 years, DOL is amending its Davis-Bacon Act regulations to recognize "helper" classifications and wage rates, but only where their duties are clearly defined and distinct from those of journeyman and laborer classifications in the area, the use of such helpers is an established prevailing practice in the area, and the term "helper" is not synonymous with "trainee" in an informal training program.

EDITOR'S NOTE: The DOL regulations pertaining to the Davis-Bacon Act are in Title 29 of the Code of Federal Regulations (CFR), Labor; Part 5, Labor Standards Provisions Applicable to Contracts Covering Federally Financed and Assisted Construction (Also Labor Standards Provisions Applicable to Nonconstruction Contracts Subject to the Contract Work Hours and Safety Standards Act).

For a recent proposed change to DOL's Davis-Bacon Act regulations, see the September 21, 2000, FEDERAL CONTRACTS DISPATCH "Department of Labor; Labor Standards Provisions Applicable to Federally Financed and Assisted Construction Contracts."

DATES: Comments must be received on or before October 23, 2000.

ADDRESSES: Send comments to T. Michael Kerr, Administrator, Wage and Hour Division (Attention: Government Contracts Team), Employment Standards Administration, U.S. Department of Labor, Room S-3018, 200 Constitution Avenue, NW, Washington, DC 20210; fax: 202-693-1432.

FOR MORE INFORMATION CONTACT: Timothy Helm, Office of Enforcement Policy, Government Contracts Team, Wage and Hour Division, Employment Standards Administration, U.S. Department of Labor, Room S-3018, 200 Constitution Avenue, NW, Washington, DC 20210; 202-693-0574.

SUPPLEMENTAL INFORMATION: In 1982, DOL published regulations which would have allowed construction contractors to use semi-skilled helpers on Davis-Bacon projects at wages lower than those paid to skilled journeymen. To protect against possible abuse, the number of helpers which could be used on a covered project was limited to a maximum of two helpers for every three journeymen. However, DOL suspended the regulations when a series of rulings on a continuing AFL-CIO lawsuit by the U.S. District Court for the District of Columbia Circuit and the Court of Appeals for the District of Columbia struck down key provisions of the regulations (including the 2 to 3 ratio), and Congress included a prohibition on the use of funds to enforce the semi-skilled helpers regulations in DOL appropriations acts through fiscal year 1995. But the FY96 DOL appropriations act, which was signed into law April 26, 1996, contained no such prohibition. Since April 26, 1996, DOL has been considering whether the suspended helper regulations should be modified.

On August 2, 1996, DOL proposed to continue the suspension of the helper regulations previously issued while it conducted additional proceedings to determine whether further amendments should be made to those regulations. After consideration of the comments submitted in response to the proposed rule, DOL issued a final rule on December 30, 1996, which continued the suspension of the helper regulations issued under the Davis-Bacon Act until it either (1) issued a final rule amending (and superseding) the suspended helper regulations; or (2) determined that no further rulemaking is appropriate and issued a final rule reinstating the suspended regulations. On July 23, 1997, the U.S. District Court for the District of Columbia upheld DOL's December 30, 1996, final rule continuing the suspension of the helper regulations until the completion of rulemaking proceedings.

After a thorough review of the Davis-Bacon Act, the various court decisions, and all the other factors that have been involved in this issue during the last 18 years, DOL concluded that the suspended rule could not be enforced effectively, primarily because of difficulties in defining "semi-skilled helpers", and in conducting meaningful wage determinations since contractors to area wage surveys would ascribe very different meanings to the term "helpers". Therefore, on April 9, 1999, DOL proposed revising its Davis-Bacon Act regulations to reflect its longstanding practice of recognizing helpers only where they are a separate and distinct class with clearly defined duties.

DOL received 23 comments on its proposal, including three groups of Congressional representatives, six contractor organizations, three union organizations, one union-contractor group, the Texas Department of Transportation, and two academic sources. Based on a review of the comments and further consideration of the alternatives, DOL has decided to adopt as a final rule an amendment to its regulations that will incorporate its longstanding practice. DOL states in its introduction to the final rule that it believes the rule "provides the only approach that is administratively feasible. Unlike some of the other alternatives considered, the policy under the rule does not require Wage and Hour [Division], in its enforcement, to make a fact-bound inquiry of each worker to assess his or her skill level and the nature of the worksite supervision he or she receives to determine whether the worker will be recognized as a 'helper' for Davis-Bacon purposes."

This final rule makes the following changes to Title 29 of the CFR:

In addition, Section 5.2(n)(1) and Section 5.5(a)(4) are amended to reflect the change in the title of the "Bureau of Apprenticeship and Training (BAT)" to the "Office of Apprenticeship, Training Employer and Labor Services (ATELS)."

FOR FURTHER INFORMATION CONTACT: Barry McVay at 703-451-5953 or by e-mail to BarryMcVay@FedGovContracts.com.

Copyright 2000 by Panoptic Enterprises. All Rights Reserved.

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