The Department of Labor finalized the first major Davis-Bacon regulatory overhaul in nearly 40 years, with an updated WH-347 certified payroll form released January 2025 and civil penalties increased to $13,508 per violation. The stakes: $217 billion in FY2026 federal construction spending and more than 12,000 active projects. Coverage from DOL Wage and Hour Division and BlueWave HR's 2026 Prevailing Wage Guide.
What Davis-Bacon actually covers
Davis-Bacon applies to any federal government or D.C. contract over $2,000 for construction, alteration, or repair of public buildings or public works. Contractors and subcontractors must pay laborers and mechanics at least the locally prevailing wages and fringe benefits for corresponding work on similar projects in the area.
The compliance changes contractors are still absorbing
- Updated WH-347. The certified payroll form was updated January 2025. Use of the old version is a documentable finding.
- Civil penalty increase. From prior levels to $13,508 per violation. A 100-worker project with a consistent wage-determination error could reach seven-figure exposure fast.
- Prevailing wage determinations. Wage determinations cover more trades and more geographies than at any point in the Act's 95-year history.
- Fringe benefit calculations. The prevailing wage is the basic hourly rate PLUS listed fringe benefits. Miscalculating the fringe component is now among the most common findings.
Penalty structure, stacked
- Civil fines up to $13,508 per violation
- Back wages owed to affected workers
- Contract termination
- Payment withholding from open invoices
- Debarment from federal contracts for up to 3 years
- Potential criminal prosecution for willful violations
What to do this week
- Verify your payroll team is using the updated WH-347 — the old form is a finding
- Recheck active-project wage determinations against the current DOL database (dol.gov/whd)
- Audit a sample of fringe benefit calculations — this is where penalty exposure concentrates
- Flowdown requirements: all subcontractors must meet the same standard; your prime contract exposure depends on their compliance