What is a prevailing wage?
The definition, where the requirement comes from, and how to find the rate that applies to you
A prevailing wage is the minimum hourly pay - a base rate plus fringe benefits - that contractors must pay each class of worker on covered public construction projects, set to the rate already prevailing for that work in the local area. On federally funded U.S. construction, prevailing wages are required by the Davis-Bacon Act and set county by county by the U.S. Department of Labor.
How it works
The Department of Labor publishes wage determinations - schedules listing, for one county and one type of construction, the required base rate and fringe amount for each job classification (electrician, carpenter, laborer, operator, and so on). A contractor on a covered project must pay workers in each classification at least that base rate, plus the fringe amount either as bona fide benefits or as cash added to the paycheck (40 U.S.C. §3142; 29 CFR part 5).
The prevailing wage is a floor for a specific classification on covered work - not an average salary, and not the general minimum wage. See prevailing wage vs. minimum wage for the comparison.
Where prevailing-wage requirements come from
- Federal construction: the Davis-Bacon Act covers federal and federally assisted construction contracts over $2,000.
- Federal service contracts: the Service Contract Act applies the same idea to service workers on federal contracts over $2,500.
- State and local projects: about half the states have their own “little Davis-Bacon” laws for state-funded public works - each with its own threshold and rate schedules. See the state-by-state table.
Who it covers
Davis-Bacon covers laborers and mechanics employed on the site of the work - the trades doing physical construction. It does not set wages for office staff, executives, or workers whose duties are primarily administrative or professional (29 CFR §5.2).
Finding your rate
The binding number is in the wage determination for your county and construction type. Look up your wage determination, or read how wage determinations work first.