Trump’s Davis-Bacon Quote Turns Construction Industry Heads

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By Elliott T. Dube

Construction industry stakeholders got a jolt when President Donald Trump recently approached what a U.S. Chamber of Commerce official called a “third rail issue” for building trades unions: changes to the Davis-Bacon Act.

Trump said in a New York Times interview published April 5 that he was “going to make an announcement in two weeks” regarding Davis-Bacon. The law requires contractors on federally funded construction projects to pay prevailing wages for a given area. Trump declined to provide further details when prompted by an interviewer.

Contextual clues for what Trump might have in mind for Davis-Bacon are scant, Jim Plunkett, a senior government relations counsel for Ogletree Deakins Nash Smoak & Stewart who formerly directed labor law policy for the Chamber, told Bloomberg BNA April 12. The Labor Department and the National Labor Relations Board are still lacking key personnel, who “normally would have been good indicators of where things are heading,” Plunkett said.

Legislation More Likely Than Regulation

Despite Trump’s signal for movement on the law, the “idea that they would make any kind of really significant changes to it is really hard to imagine right now,” Marc Freedman, the Chamber’s executive director of labor law policy, told Bloomberg BNA April 12.

If Capitol Hill does soon turn up the volume on a Davis-Bacon discussion, it would more likely involve congressional legislation, not regulatory action spearheaded by Trump’s Labor Department, Freedman said.

Freedman referenced Trump’s proposal for $1 trillion in infrastructure investment over the next decade. The “theory that people are working off of” is that Trump is mindful of corralling enough congressional support for any upcoming infrastructure package, Freedman said.

“If Trump thinks he wants Democrats on board, I don’t see how he can start fooling around with the Davis-Bacon concept there,” he said. “For the unions, Freedman said, “that is truly the lifeblood of their sector, and they will go to great lengths to protect Davis-Bacon as we know it.”

A Trump deal over infrastructure with either Democrats or Republicans that centers on Davis-Bacon is unlikely, Freedman said. Anyone promoting the idea that there could be a trade-off in which an outright repeal of Davis-Bacon is exchanged for infrastructure plan support is “not being serious,” Freedman said. “There are good arguments for it, but that’s just not going to prevail politically.”

North America’s Building Trades Unions, the International Brotherhood of Electrical Workers, the International Union of Operating Engineers and the Laborers’ International Union of North America didn’t respond to requests for comment.

Unions Wary of Any Davis-Bacon Change

The Construction Employers of America, a coalition of specialty contractor groups, will work with the Trump administration and Congress to guarantee “robust enforcement” of prevailing wage requirements, CEA spokesman Jack Jacobson told Bloomberg BNA in an April 12 email. Davis-Bacon offers worker protections that “raise the standard of living for all Americans,” he said.

“We look forward to any Trump Administration policies that will further strengthen the country’s long-established and effective prevailing wage policy,” Jacobson said.

Building trades unions have been “100 percent opposed” to any type of changes to Davis-Bacon, Ben Brubeck, the vice president of regulatory, labor and state affairs for Associated Builders and Contractors, told Bloomberg BNA April 12.

ABC, which primarily consists of nonunion contractor members, supports the full repeal of Davis-Bacon. The association has also backed smaller-scale reforms to the way the law is implemented and enforced, the makeup of the survey method currently used for determining prevailing wage rates, definitions about job classifications and how to pay workers based on the type of work they perform, Brubeck said.

“One would think common-sense reforms would be feasible, but no one has implemented any significant changes to it since the Reagan years,” Brubeck said.

Critics of the survey method have argued that a disproportionate number of survey responses come from union contractors. This means that reported wage rates usually are union rates agreed to in collective bargaining, critics contend.

But as Trump and his advisers “are aware,” regional prevailing wage calculations are based on a survey of local market wages and benefits paid to construction workers without regard to their union or nonunion status, Jacobson said. This process is fair and transparent and has been “working for the American people” since Davis-Bacon’s enactment in 1931, Jacobson said.

Stakeholders Left to Speculate

“On a broader macro level, I think the business community is still wondering how the president is going to view the various labor and employment issues that are out there,” Plunkett said.

On the one hand, Trump blocked the Obama administration’s Fair Pay and Safe Workplaces executive order that required federal contractors to disclose labor law violations and that many business groups opposed, Plunkett said. On the other hand, Trump has reached out to organized labor through meetings with building trades union leaders and AFL-CIO President Richard Trumka, Plunkett noted.

Trump notably omitted any mention of Davis-Bacon in an April 4 speech at NABTU’s annual legislative conference.

To contact the reporter on this story: Elliott T. Dube in Washington at edube@bna.com

To contact the editors responsible for this story: Peggy Aulino at maulino@bna.com; Terence Hyland at thyland@bna.com; Christopher Opfer at copfer@bna.com

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