American Recovery and Reinvestment Act (ARRA)

Stimulus dollars are coming under the ARRA, but do not let a windfall become a downfall. The U.S. Department of Labor, Wage and Hour Division is adding an additional 250 Wage Hour Investigators who will be dedicated to Davis Bacon and Related Acts (DBRA) and Service Contracts Act (SCA) investigations funded under the ARRA. The chance of being investigated is increased ten-fold under ARRA. The Wage and Hour Division has announced their Investigators will not be looking for compliance, but for violations; in particular willful violators who will be debarred.

For ARRA Stimulus recipients, you have just become "Federal Contracting Agencies" responsible for:

Reviewing your contractors' "Weekly" Payroll Records. DBRA Contractors are required to pay their employees weekly and submit Certified Payrolls to the funding agency.
Ensuring DBRA compliance by observing and interviewing Contractor employees at the site of performance.
Ensuring that Contractor employees work within the job classification(s) listed in the Wage Determination and that they are paid for all hours worked in each individual workweek.
Computing any back wages for employees employed in violation of the several Federal Statutes covering work on federally financed projects.
Withholding funds from Contractors, if necessary, to pay employees employed in violation of the various statutes.
Submitting semiannual compliance activity reports to the U. S. Department of Labor.
The funded entity, State, County, City, etc. will be responsible for a total DBRA surveillance program.

For Contractors and Service Providers who have little or no experience working on Federally Funded projects, your administrative and oversight workload has just quadrupled to say the least. To do nothing or to gamble that you will not be investigated could cost you your entire business. Even after the stimulus dollars have been spent an investigation still goes back two or even three years if willfulness is suspected. Retroactive compliance can cost thousands or tens of thousands in back wages if DOL/WH comes in to investigate. If you have to defend a law suit or debarment the costs can easily double, triple or more.

I just returned from a Prevailing Wage Conference sponsored by the U.S. Department of Labor, Wage and Hour Division and left with the full understanding they are serious about their responsibilities under the American Recovery and Reinvestment Act of 2009.