U.S. DEPARTMENT OF LABOR
EMPLOYMENT STANDARDS ADMINISTRATION
Wage and Hour Division
WASHINGTON, D.C. 20210
MEMORANDUM NO. 123
TO: ALL GOVERNMENT CONTRACTING AGENCIES OF THE FEDERAL
GOVERNMENT AND THE DISTRICT OF COLUMBIA
SUBJECT: REPORTING AND PAY REQUIREMENTS FOR SUBCONTRACTORS WHO ARE
THEMSELVES PERFORMING THE WORK OF LABORERS AND MECHANICS
The statutory language of the Davis-Bacon Act makes it clear that Congress
intended that individuals performing the work of laborers and mechanics on
construction sites be guaranteed the prevailing wage rate "regardless of
any contractual relationship which may be alleged to exist between the
contractor or subcontractor and such laborers and mechanics. . . "
Therefore, when officers/owners of a subcontractor corporation, partnership,
or proprietorship, are themselves performing the work of laborers and
mechanics, the prime contractor must pay them weekly an amount equal to at
least the applicable prevailing , wage for the hours worked in the specific
classification and list than on his certified payroll records in accordance
with section 5.5 (a) (3) of the Regulations, 29 CER Part 5, Subtitle A.
In other words, the subcontractor who is a bona fide independent contractor,
who himself performs the work of a laborer or mechanic on a project subject
to the Davis-Bacon and Related Acts, may occupy a dual role under this law.
In certain situations, he is simultaneously a laborer or a mechanic who
must be carried on the prime contractor's payrolls and paid by the prime
contractor for his work at not less than the rate predetermined by the
Secretary of Labor for that classification and also, an employer who must
live up to his obligations under the law for any laborers and mechanics he
himself may employ.
Of course, it would be permissible under the Davis-Bacon Act to deduct from
the subcontractor’s contract payments any straight time wages which the
Davis-Bacon Act. However, if the subcontractor himself is performing work
Under a contract also subject to the Contract Work Hours and Safety Standards
Act, which provides for time and one-half over eight hours in a day or 40
hours in a week, overtime payments due him may not be deducted from the