FAQ

Q: What is the Davis Bacon Act?
A: The Davis-Bacon Act of 1931 is U.S. federal legislation which established the requirement for paying “prevailing wages” on public works projects. All federal government construction contracts and most contracts for federally assisted construction over $2,000 must include provisions for paying workers on-site no less than the local prevailing wages and fringe benefits paid on similar projects.

The act is named after its Republican sponsors, James “Puddler Jim” Davis, a senator from Pennsylvania and a former Secretary of Labor under three presidents, and Representative Robert L. Bacon of Long Island, New York.
Q: What is the McNamara-O’Hara Service Contract Act (SCA)?
A: The McNamara-O’Hara Service Contract Act requires contractors and subcontractors performing services on prime contracts in excess of $2,500 to pay service employees in various classes no less than the wage rates and fringe benefits found prevailing in the locality, or the rates (including prospective increases) contained in a predecessor contractor’s collective bargaining agreement. The Department of Labor issues wage determinations on a contract-by-contract basis in response to specific requests from contracting agencies. These determinations are incorporated into the contract.
Q: What is labor burden?
A: Labor burden is primarily comprised of payroll taxes, unemployment taxes and various forms of insurance. Field labor burden also includes general liability and workers compensation insurance. Labor burden includes a range of taxes such as FICA, FUTA, SUTA, WCI, GLI.
Q: What is ERISA?
A: The Employee Retirement income Security Act of 1974 (ERISA) (Pub. L. 93-406, 88 Stat. 829, enacted September 2, 1974) is an American federal statute that establishes minimum standards for pension plans in private industry and provides for extensive rules on the federal income tax effects of transactions associated with employee benefit plans. ERISA was enacted to protect the interests of employee benefit plan participants and their beneficiaries by requiring the disclosure to them of financial and other information concerning the plan; by establishing standards of conduct for plan fiduciaries; and by providing for appropriate remedies and access to the federal courts.

ERISA is sometimes used to refer to the full body of laws regulating employee benefit plans, which are found mainly in the Internal Revenue Code and ERISA itself.

Responsibility for the interpretation and enforcement of ERISA is divided among the Department of Labor, the Department of the Treasury (particularly the Internal Revenue Service), and the Pension Benefit Guaranty Corporation.
Q: What is a Fiduciary?
A: Fiduciary Standards. Part 4 of Title of ERISA I sets forth standards and rules for the conduct of plan fiduciaries. In general, persons who exercise discretionary authority or control over management of a plan or disposition of its assets are “fiduciaries” for purposes of Title I or ERISA. Fiduciaries are required, among other things, to discharge their duties solely in the interest of plan participants and beneficiaries and for the exclusive purpose of providing benefits and defraying reasonable expenses of administering the plan. In discharging their duties, fiduciaries must act prudently and in accordance with documents governing the plan, to the extent such documents are consistent with ERISA.
Q: What is a Prevailing Wage?
A: An hourly wage established by the Department of Labor that is paid to employees working on federal and state public work projects.
Q: What is a Fringe Benefit?
A: A non-cash compensation that is given to employees working on federal and state public work projects.