April 8, 2019 – Congressman Chris Smith (R-NJ) today introduced new bipartisan legislation to help ensure quality workmanship at federal construction projects across the country and to protect the agreed-upon day’s pay for a day’s work for local tradesmen, women and laborers. Rep. Donald Norcross (D-NJ) is the chief Democratic cosponsor of Smith’s bill. 

“Federal law—the Davis-Bacon Act—mandates that prevailing wages are paid to contract workers for a good reason—to ensure accountability and the highest standard of craftsmanship at taxpayer-funded projects, and to prioritize workplace safety,” Smith said. “My legislation would make sure this law is enforced to the fullest extent so that taxpayer-funded construction projects are done right.”

Smith’s bill is supported by NJ State Pipe Trades and NJ State Building & Construction Trades Council.

“This legislation is long overdue. It will level the playing field for local contractors. The taxpayer has been and still is being cheated without this legislation,” stated Mike Maloney, President of the New Jersey State Pipe Trades. “By the current system and the contractor not using the appropriate skilled craft for the day, week or the duration of the job, the cost overruns on federally funded military Davis-Bacon jobs are rampant. I challenge anyone to dispute that. This legislation will put local skilled craft workers to work and with that scenario everybody wins. This includes the worker, the vendors and the towns of where the construction is being performed.”

“We applaud Congressman Smith’s dedication to working men and women of the building and construction industry underscored by his recent efforts to stop unscrupulous contractors from misclassifying and exploiting their workers,” stated William Mullen, President of the New Jersey State Building & Construction Trades Council. “Misclassified employees are robbed of critical benefits and protections they are entitled to by law, such as a fair wage, overtime compensation, unemployment insurance, and safe workplaces.  Our tax dollars should not support federal contractors who skirt the law at the expense of working men and woman of the building and construction trades industry.”

Smith’s legislation confronts the practice of “misclassification,” where independent contractors and subcontractors at federal construction projects falsely report high-skilled laborers at a rate adequate for lower training qualification, and/or for independent contractors. This practice opens the bidding process to low-road contractors and thereby threatens the caliber of workmanship and workplace safety at federal construction projects.

Through misclassification, contractors are able to skirt the law to pay smaller wages and fewer local, state and federal taxes. Over the years, Smith has visited federal jobs in all three counties in his district that have suffered from poor workmanship and delays because of loose enforcement of federal contracting safeguards.

“This year alone, more than $146 million in military construction will be awarded at the Joint Base and we will be closely watching each and every one of these sites to ensure that our taxpayers get their money’s worth and that these projects are done right and safely,” Smith said.

“At the same time, however, we know that there needs to be a system-wide investigation to identify those fly-by-night contractors who routinely circumvent current rules and regulations, so that we can quantify the problem and prevent bad actors from gaining such critical contract work in the first place.” 

The Davis-Bacon Act of 1931 requires that workers at federal projects of construction, alteration, or repair, and which the federal government is party to, are paid locally prevailing wages as determined by the Department of Labor. If locally prevailing wages have not been paid to employees at the project, the government can terminate the contract.

To better enforce this law, Smith’s bill would require the GAO to investigate what programs the U.S. Army Corps of Engineers (USACE) has in place to monitor contractor misclassification, to ensure lawful wages are being paid to all employees at federal construction sites, and to receive and examine any misclassification complaints.

“We need to know what is being done by agencies that have the responsibility for enforcing the law here,” Smith said. “There must be enforcement mechanisms in place to ensure workers are not being taken advantage of, and that our tax dollars will fund quality construction projects.”

On Oct. 4, 2018, Smith led a letter to the GAO requesting an investigation of USACE and its practices and protocols for finding misclassification, due to reports of violations of the Davis-Bacon Act by federal contractors and subcontractors.