March/April 2022 - 109

SARAH K. CARPENTER, PARTNER
SMITH CURRIE
LEGALLY SPEAKING
" Adjacent " or " Virtually Adjacent "
Under the Davis Bacon Act
On federal and federally funded projects, contractors face a
multitude of wage-related requirements and liabilities. Key
among these are prevailing-wage laws, including the Davis
Bacon Act (the " DBA " or the " Act " ) and similar state prevailing
wage laws modeled after the DBA. The Act, which applies to
federal contracts in excess of $2,000 for construction,
alteration or repairs, requires contractors and subcontractors
to pay laborers who are " employed directly on the site of the
work " locally prevailing wages and fringe benefits for
corresponding work on similar projects in the area.
The question of DBA applicability to workers on a project
is not as clear as it may seem. That is because prevailing
wages must be paid not only to those working within the
geographical limits of the project site, but also to laborers
working at locations " adjacent or virtually adjacent " to the
site. The Federal Regulations governing the DBA defines " site
of the work " as follows:
(1) The site of the work is the physical place or places
where the building or work called for in the contract will
remain; and any other site where a significant portion of the
building or work is constructed, provided that such site is
established specifically for the performance of the contract or
project.
(2) Except as provided in paragraph (l)(3) of this section, job
headquarters, tool yards, batch plants, borrow pits, etc., are
part of the site of the work, provided they are dedicated
exclusively, or nearly so, to performance of the contract or
project, and provided they are adjacent or virtually adjacent to
the site of the work as defined in paragraph (l)(1) of this
section;
(3) Not included in the site of the work are permanent
home offices, branch plant establishments, fabrication
plants, tool yards, etc., of a contractor or subcontractor whose
location and continuance in operation are determined wholly
without regard to a particular federal or federally assisted
contract or project. In addition, fabrication plants, batch
plants, borrow pits, job headquarters, tool yards, etc., of a
commercial or material supplier, which are established by a
supplier of materials for the project before opening of bids and
not on the site of the work as stated in paragraph (l)(1) of this
section, are not included in the site of the work. Such
permanent, previously established facilities are not part of
the site of the work, even where the operations for a period of
time may be dedicated exclusively, or nearly so, to the
performance of a contract. (Emphasis added).
The Department of Labor ( " DOL " ) has declined to define
either " adjacent " or " virtually adjacent " under the DBA because
it has decided that the only " fair and practical method for
determining whether a temporary facility is virtually adjacent
to the 'site of the work' is on a case-by-case basis. " More
specifically, the DOL has chosen not to define " just how far
such a facility can be from the actual construction site and still
be considered part of the 'site of the work.' " The DOL's view is
that any such definition would create an " artificial
benchmark " that would enable contractors to avoid DBA
coverage and defeat the purpose of the Act. Instead, the DOL
expects contractors to perform a common sense, case-by-case
analysis, based on the size and nature of the project, of whether
facilities established nearby to serve a federal or federally
assisted project are covered by the DBA.
The Department of Labor ( " DOL " ) has
declined to define either " adjacent " or
" virtually adjacent " under the DBA
because it has decided that the only " fair
and practical method for determining
whether a temporary facility is virtually
adjacent to the 'site of the work' is on a
case-by-case basis. "
Although the DOL has not offered a geographic definition
for either " adjacent " or " virtually adjacent, " some guidance
regarding the potential geographic scope of these concepts is
available. This guidance includes the Administrative Review
Board's (the " board " ) decisions known as Bechtel I (1996 WL
874457) and Bechtel II (1998 WL 168939). Bechtel I and Bechtel II
involved a project for the construction of 330 miles of
aqueduct and pumping plants and a dispute over whether the
DBA applied to work performed at three batch plants located
less than one-half mile from various pumping stations (and
often requiring concrete from the batch plants to be delivered
to construction locations up to 15 miles away from the plants).
The board in Bechtel I and Bechtel II analyzed the nature of the
project and determined that because of the project's narrow,
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March/April 2022

Table of Contents for the Digital Edition of March/April 2022

TOC
March/April 2022 - Intro
March/April 2022 - 1
March/April 2022 - 2
March/April 2022 - TOC
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