Labor Law -- 2016

District of Columbia v. U.S. Dep't of Labor   (D.C. Circuit)

Davis Bacon Act does not apply to private construction projects

On March 11, 2015 the NAM filed a brief with the D.C. Court of Appeals asking that order and judgment of the District Court be affirmed in DC and CCDC Office, LLC v. DOL, et al. As way of background, in June 2011, the Department of Labor ruled that the City Center DC project is subject to the 1931 Davis-Bacon Act, which requires "prevailing wages" for construction workers on public buildings or public works projects funded by the federal or D.C. government. The District of Columbia appealed, arguing that the development, led by Hines Interests LP, is being privately built, financed, and operated, and that the ruling could cost the city $20 million in unanticipated wages, since D.C. would be required to reimburse the developers for the extra costs. But the Labor Department's Administrative Review Board upheld the earlier decision on April 30, 2013. DC filed suit against the Department of Labor and CCDC Office LLC, representing the developers, followed with a similar suit.

In general, the NAM views the DOL’s attempt to apply the Act to the Project as an unprecedented effort to impose the requirements of the Act far beyond the public works, government construction contracts that it was meant to regulate, and into the context of private construction projects that are not funded by the government, not constructed by or for the government, not owned by the government, nor occupied in any respect by the government. The NAM brief argued four main points. First, the Department of Labor’s attempt to apply the Davis Bacon Act to a private construction project is fundamentally flawed and contrary to the plain language and intent of the Act. Second, if unchecked, the Department of Labor is poised to continue its unprecedented attempt to expand the scope of the Davis Bacon Act into the private construction industry. Third, if unchecked, the Department of Labor’s attempt to apply the Davis Bacon Act to the private construction industry would have a significant and potentially negative impact on private industry, the government and the economy. Fourth, the Department of Labor’s methods for calculating the prevailing wage are unreliable and should not be applied to the private construction market. On April 5, 2016 the DC Circuit upheld the District Court’s previous ruling that Davis-Bacon did not apply to the CityCenterDC project.

Related Documents:
NAM brief  (March 11, 2015)


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