S-4477-119
Read twice and referred to the Committee on Health, Education, Labor, and Pensions.
Sponsored by Mike Lee (R-UT)
What it does
This bill would repeal the Davis-Bacon Act's wage requirements, which currently require contractors on federally funded construction projects to pay workers the "prevailing wage" — typically the local union wage rate — as determined by the Department of Labor. The repeal would take effect 30 days after enactment but would not apply to contracts already in existence or bids already outstanding at that time. All references to Davis-Bacon wage requirements in other federal laws would also become null and void.
Who benefits
Non-union construction contractors who currently must pay prevailing wages on federal projects, making them more cost-competitive. Taxpayers and federal agencies, if lower labor costs reduce the total price of federally funded construction projects. Small and mid-sized construction firms that argue compliance with Davis-Bacon paperwork and wage determinations is burdensome. State and local governments that receive federal construction funding and could potentially stretch those dollars further. Open-shop (non-union) workers who may gain access to more federal project opportunities if contractors expand hiring.
Who is hurt
Union construction workers and their families, who would likely see downward pressure on wages on federal projects. Non-union workers currently benefiting from prevailing wage floors on federal job sites. Workers in regions where the prevailing wage is significantly above the local market minimum. Labor unions in the construction trades, which use Davis-Bacon compliance as a floor for wage standards. Communities where federal construction projects are a significant source of middle-income employment. Workers who may face increased competition from lower-wage labor on federal sites.
Supporters argue
Supporters argue that Davis-Bacon artificially inflates the cost of federal construction projects, with studies — including analyses by the Cato Institute and Congressional Budget Office — estimating the law adds 5–15% to project costs, meaning fewer projects can be completed with the same appropriated dollars. They contend that prevailing wage determinations are often outdated, methodologically flawed, and effectively mandate union-scale wages even in areas where union membership is low, distorting local labor markets and disadvantaging the majority of construction workers who are not union members.
Opponents argue
Opponents argue that Davis-Bacon, enacted in 1931, exists to prevent the federal government from undercutting local wage standards by awarding contracts to out-of-area contractors paying below-market wages — a practice documented before the law's passage. They contend that repealing prevailing wage requirements would reduce take-home pay for hundreds of thousands of construction workers on federal projects, citing Economic Policy Institute research showing Davis-Bacon raises wages for affected workers by roughly 4–7%, and that any taxpayer savings are offset by reduced worker spending power and increased reliance on public assistance programs.
Constitutional context
Congress has broad authority to set conditions on federal spending and contracts under the Spending Clause (Art. I, §8) and the Commerce Clause. Repealing an existing statute is a straightforward exercise of legislative power and does not raise significant constitutional questions. Post-Loper Bright (2024), any remaining Department of Labor regulations implementing Davis-Bacon would face independent judicial scrutiny if their statutory basis is eliminated.
Checks and balances
Congress would eliminate the executive branch's (Department of Labor's) authority to set and enforce prevailing wage determinations on federal contracts; no new agency authority is created, and the check on this repeal is the standard legislative process, including presidential veto.
Historical precedent
Multiple states have repealed their own "little Davis-Bacon" prevailing wage laws — including Kentucky (2017) and Indiana (2015) — providing some empirical basis for projecting effects, though results in those states are disputed between researchers.