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elgueromeromero

Applicability of Wage Determination to Subcontract

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Question: Does the prime contract scope or the subcontract scope determine wage requirements of the subcontract?

Our prime contract includes both a DBA WD and an SCA WD. The subcontract we're issuing is for well drilling services. We previously determined (for various reasons) that this type of well drilling is not "construction work". However, our drilling subcontractor thinks that DBA should apply to their subcontract.

Is the applicability of DBA vs SCA dependent on the Prime's scope of work and specific facts surrounding the drilling work, or is it strictly based on the subcontractor's scope, which is essentially just "drilling of wells"? 

 

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The prime contract’s wage determination applies to both contractor and subcontractor employees who are directly involved in the work. 

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@elgueromeromero if you haven't already reviewed FAR 22.402(b), please do so.  I don't express an opinion, as your post seems to contain more conclusions than facts.

Perhaps it would be clearer if you explained what portion of the work the parties to the prime contract believe is subject to Davis-Bacon and how clear the contract made it that the drilling work is not.  See also Wage and Hour Division, Field Operations Handbook, Chapter 15, paragraph 15d05 (https://www.dol.gov/whd/FOH/FOH_Ch15.pdf)

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The real question is when both DBA and SCA are in your contract and passed down to your subs when should the applicable rates of one or the other apply to the specific work being done?   The answer is it would depend on what the work is and in essence only one wage requirement would apply as both can't so to speak.  References that might help are  29 CFR 4.116(c)(2) and a very old DOL document that is still referenced today AAM 55.  Links to finding both will follow.

While you and your sub disagree the steps I would suggest to solve the matter is first ask the contracting agency.  They for some reason felt both DBA and SCA should be in the contract so find out why.  If it relates to drilling then their determination may help.   In the end the DOL would have the final say so consider contacting them as well.   All in all get it right now as having to solve latter due to say a DOL investigation it will become a difficult situation.   In the end it is your responsibility (and your subs) to pay appropriately under the correct wage laws.

https://www.ecfr.gov/cgi-bin/text-idx?c=ecfr&sid=99c9a20e960f56be66f17ae91b52c888&rgn=div5&view=text&node=29:1.1.1.1.5&idno=29#se29.1.4_1116

https://beta.sam.gov/help/wage-determination-resources/all-agency-memos  To find Agency Administering Memorandum (AAM) 55  go to 55 or do a "find" on "55" and then click on the 55 to pull up the memo.

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As I mentioned in a separate thread , I suggest that you ask the Wage and Hour Division or someone else in the DOL. 

 

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Joel is right in his recommendation.  By way of an aside, though, if you haven't already read it, I encourage you to read Ruling Letter DBRA2003-1, "Excavation and Restoration as construction work under the DBA" available here.  It concludes work can be for environmental work and still be subject to Davis-Bacon Act.

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