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Stanton Confirmed as New Administrator of WHD

May 16, 2019


The Department of Labor has announced that Cheryl Marie Stanton has been confirmed by Congress and officially sworn-in by Secretary of Labor, Alexander Acosta, as the new Administrator of Department’s Wage and Hour Division (WHD). Stanton has been awaiting confirmation by the Senate since being initially nominated in September 2017.

Before coming to Washington DC, Stanton served in public service as the Executive Director of the South Carolina Department of Employment and Workforce. Under her leadership, the jobless rate in South Carolina was at its lowest point in almost 50 years. During this time, Stanton also oversaw the workforce system that helped place over 500,000 South Carolinians in jobs as well as leading two major information technology modernization projects that improved customer service and increased efficiencies for employees. Also, Stanton partnered with her colleague at the Department of Corrections to create the Second Chance job re-entry program for ex-offenders, receiving national accolades.

As the new administrator, Stanton will bring her breadth of experience to the Division, leading efforts in the enforcement of the federal minimum wage, overtime pay, recordkeeping, child labor requirements of the Fair Labor Standards Act, the Family and Medical Leave Act, and consumer credit protections. Additionally, overseeing prevailing wage requirements of the Davis Bacon Act and the Service Contract Act and other statutes applicable to Federal contracts for construction and the provision of goods and services.

Optimism For Infrastructure Legislation

May 10, 2019


There was a recent meeting between the Administration and key Democratic lawmakers which concluded in an agreement to seek a $2 trillion legislative infrastructure package to improve and repair the nation’s roads, bridges, waterways, and broadband networks.

In the meeting, President Trump, House Speaker Nancy Pelosi, and Senate Minority Leader Charles Schumer each agreed on the importance of investing in this country’s future and rebuilding America’s infrastructure. Pelosi and Schumer told reporters after the meeting that “we’re very excited about the conversation we had with the president”; calling it a “good and constructive start.” Likewise, the White House also appeared optimistic about the discussion with Trump stating “an excellent and productive meeting” with the Democrats.

The Democratic leaders further noted that the two sides found common ground on some of the priorities that an infrastructure plan should address. Following the meeting, Democrats sent Trump a letter which outlined government funding, environmental considerations and Buy American provisions as three key priorities.

To date, both parties have submitted separate funding proposals to achieve the infrastructure goals. Nevertheless, the funding source continues to be unclear even with bipartisan agreement on the $2 trillion investment amount.  Future discussions are planned.

February 2019 Construction Spending

May 7, 2019


The U.S. Census Bureau announced construction spending for February 2019 was at a seasonally adjusted annual rate of $1,320 billion, 1.0 percent above the revised estimate of $1,307 billion in January. Compared to the same period last year, February was up 1.1 percent. For the first two months of the year, construction spending was $182 billion, up 1.4 percent for the same period last year.

While private construction spending in February was $994 billion, 0.2 percent above the revised January estimate of $993 billion; public construction spending was $326 billion, 3.6 percent above last month’s revised estimates of $314 billion. Compared to the same period last year, public construction was up 11.5 percent.

There were several contributors to public construction spending growth in February. The main contributor was Highway construction which was $111 billion, up 9.5 percent from revised January estimates of $101 billion. Compared to the same period last year, Highway construction is up 22.8 percent.

More information may be found at: https://www.census.gov/construction/c30/pdf/release.pdf

USDOL Announces Proposed Overtime Update

March 12, 2019


The U.S. Department of Labor announced a Notice of Proposed Rulemaking (NPRM) would be published to increase the weekly wage threshold to determine who is eligible for overtime pay under the Fair Labor Standards Act.

Employees earning less than the current threshold of $455 per week, which was established in 2004, must be paid overtime if they work more than 40 hours per week. The newly proposed threshold is $679 per week. The U.S. Department of Labor established this threshold based on comments from the public following a Request for Information in 2017, as well as six in-person listening sessions.

To be exempt from the new overtime proposal an employee must be paid a fixed salary, paid a weekly amount of at least $679, and primarily perform executive, administrative, or professional duties.

The public will have sixty days in which to provide comments once the NPRM is published in the Federal Register.

More information can be found at https://www.dol.gov/whd/overtime2019/.

2018 Construction Spending Update

March 5, 2019


The U.S. Census Bureau announced construction spending for 2018 was at a seasonally adjusted annual rate of $1,292.7 billion based on spending in December. The value of construction during 2018 increased by 4.1 percent compared to the same period in 2017.

While private construction spending was $991.2 billion based on spending in December, public construction spending was $301.5 billion. In 2018, both Private and Public construction spending were up with Private up 3.4 percent and Public construction, almost double that, increasing 6.6% from spending in 2017.

There were several contributors to public construction spending growth in 2018:

  • Transportation construction was $34.9 billion, which was up 15 percent above the 2017 figures
  • Educational construction was $73.6 billion, up 3.8 percent
  • Highway construction was $94.6 billion, 4.2 percent above 2017

More information may be found at: https://www.census.gov/construction/c30/pdf/release.pdf

Forty-Two Percent Of Americans Struggle To Save For Retirement

February 25, 2019


GoBankingRates recently conducted two studies to explore what Americans are setting aside for retirement savings as well as why Americans might not be saving at all. Both reported findings that have troubling outlooks on retirement especially for the millennial generation.

The first study used three different targeted Google Consumer Surveys to find out how much the average American has saved for retirement. The surveys found that 42 percent of Americans have less than $10,000 saved which according to the Bureau of Labor Statistics is not enough to cover a year’s worth of expenses. Of these same 42 percent, 14 percent of respondents have nothing saved; this, however, has improved from 18.9 percent a year ago.

This study also found that results varied dramatically by age, with older Americans slightly better at saving. Those most likely to have nothing saved are the Millennials of which 57 percent report having $10,000 or less for retirement. Furthermore, 18 percent of this same group, millennials ages 18 to 34 have the highest percentage of respondents with $0 saved.

When it comes to money saved for retirement, women and men have a nearly equal percentage when looking at those who have no retirement savings. However, survey results show that women continue to lag behind men when viewing the results of those who have saved $10,000 or less. The survey found that 45 percent of women have no savings or $10,000 or less, compared with 40 percent of men.

The second study conducted looked at why Americans are not saving by creating a separate survey of more than 1,000 adults who had no money saved. These respondents chose from a variety of answers regarding what factors lead them not to save for retirement. About 40 percent of respondent said, “I don’t make enough money,” and 25 percent stated, “I’m struggling to pay bills.”

Although the most common reason for not saving among all age groups was not making enough money, the millennial generation was more likely to say they do not have retirement saving because “I’m prioritizing to pay down debt” and “job doesn’t offer a plan.” Meanwhile, findings show that 43 percent of women are more likely to report that they are not saving for retirement because they do not make enough money compared to men, at 36 percent. This study concludes that this “may help explain the gap in retirement savings between women and men that the other survey found.”

For more details about these studies go to: https://www.gobankingrates.com/retirement/planning/why-americans-will-retire-broke/

While the findings of these surveys are troubling in general, employees that work prevailing wage projects should be in a better position to accrue retirement savings.

State of the Union: Calls for Unification Around Infrastructure

February 13, 2019


Last week President Trump delivered his 2019 State of the Union address in which he called upon both parties to unite for a significant rebuilding of America’s crumbling infrastructure. Without going into specific details, the President remarked on the fact that regardless of one’s political position, many campaigned on the same core promise to rebuild and revitalize our Nation’s infrastructure that puts America’s interests first.

In his address, Trump acknowledged Congress’s eagerness to pass an infrastructure bill and his eagerness to work with them on legislation to deliver new and important infrastructure investment, including investments in the cutting-edge industries of the future. He called the need for improved infrastructure not an option but a necessity. 

While lawmakers from both parties broadly agree that more infrastructure investment is required, some areas will require negotiations particularly concerning the amount of federal funding the plan would provide. As it is now, the plan calls for $200 billion in federal government spending, but Democrats have announced that they want to see five times that amount.

The Presidents tone throughout his address was optimistic about achieving a bipartisan plan to rebuild the nation’s infrastructure. After the speech, many Democratic senators weighed in admitting that an infrastructure package could gain support.

California Supreme Court Asked to Decide Question That Could Significantly Affect California’s Prevailing Wage Laws

February 1, 2019


The U.S. Court of Appeals for the Ninth Circuit (Court of Appeals) has requested the California Supreme Court to answer a question regarding prevailing wage coverage applying to offsite “mobilization work” that is non-construction, non-job site work based upon its tie to a public works project.

The Court of Appeals requested the California Supreme Court to answer the following question of state law: “Is operating engineers’ offsite “mobilization work”—including the transportation to and from a public works site of roadwork grinding equipment—performed “in the execution of [a] contract for public work,” Cal. Lab. Code § 1772, such that it entitles workers to “not less than the general prevailing rate of per diem wages for work of a similar character in the locality in which the public work is performed” pursuant to section 1771 of the California Labor Code?”

Initially, the Ninth District Court found that since the offsite “mobilization work” was not dependent on any public works project for their existence nor an integrated aspect of the flow process of construction that plaintiff workers were not entitled to the payment of prevailing wages for off-site mobilization work. However, the Court of Appeals noted that California courts had not previously addressed the application of the State’s prevailing wage law to off-site mobilization work.

The California Supreme Court is expected to grant the request and decide the issues presented by the Ninth Circuit. The decision will impact workers who haul other equipment to public works sites.

House Transportation & Infrastructure Committee Aims to Pass Infrastructure Bill

January 23, 2019


In a January press release, Rep. Peter DeFazio, Chairman of the House Transportation & Infrastructure Committee (the Committee) for the 116th Congress, spoke of the possibility of crafting an infrastructure bill that could pass by early June. Chairman DeFazio reasons that there is strong bipartisan support for a significant infrastructure package that would lay the groundwork for generations to come.

Believing that every state and territory in the country is directly affected by the decisions made by the Committee, DeFazio said he is seeking a bipartisan agreement on legislation to strengthen the federal role for maintaining and providing access to transportation for all Americans. Looking to put an end to the impending transportation crisis in our country, Chairman DeFazio hopes to obtain the necessary spending measures for roads, bridges and many other public works.

Although there is still no consensus for how to pay for the infrastructure package, there seems to be plenty of bipartisan support. Even with current party tensions revolved around the partial government shutdown, President Trump’s stated desire for infrastructure reform has given DeFazio and others in his party confidence that this could be one issue that parties are willing to reach across the aisle to achieve.

It Appears The Government Shutdown Has No Apparent End In Sight

January 16, 2019


We recently posted a story in this blog about the temporary closing of E-Verify due to a partial lapse in federal funding. We brought it to your attention thinking it would be a temporary inconvenience and to direct you toward agency resources.

Since then it appears the government shutdown, which primarily involves funding for a border wall, has no apparent end in sight. While it only affects certain agencies — Departments of Agriculture, Housing and Urban Development, State, Homeland Security, Interior, Justice, Treasury, Transportation, Commerce, and others — the repercussions will be felt more widespread the longer the lapse continues.

While the news focuses on the impact on federal employees as well as federal services such as Social Security checks, airport screening, national parks, and museums, and the ability of the IRS to conduct business, the impact on federal contractors is not insignificant. Affected contractors are increasingly asking questions so we wanted to take this opportunity to provide a little information regarding its impact on federal contracting and to direct you toward contracting information that may be helpful.

A very helpful resource to better understand federal contracting legal issues when there is a lapse in funding is the Congressional Research Service report titled, Government Procurement in Times of Fiscal Uncertainty, dated April 6, 2012 (R42469). A copy of this report can be viewed at https://fas.org/sgp/crs/misc/R42469.pdf  Below is a summary of key issues:

  • Both contractors and the agency personnel that administer contracts are paid with appropriated funds. Generally, if there is a lapse in appropriated funds, this would cause a lapse in the ability to award and manage contracts as well.
  • The federal government generally has broad discretion to cancel a solicitation at any time during a procurement before award.
  • The federal government also has broad discretion regarding exercising an option. Contractors are not entitled to any recovery of lost profits if the government chooses not to exercise an option.
  • Funding lapses generally prevent the government from entering new contracts or allocating new funding to cost-reimbursement contracts.
  • The government is permitted to make reductions in scope, alter the period of performance, or terminate contracts.

Please keep in mind that each circumstance is different, so there is no single answer to many of the questions we receive. It is important to note that past government shutdown experience has shown that some agencies are willing to work with government contractors and consider equitable adjustments, or other tools such as overtime, to offset lost work. Contractors should be documenting lost hours, and the impact on deliverables should this option become available.

Additionally, some unintended contract events occurred as a result of the shutdown including the previously mentioned shutdown of E-Verify, as well as limited functionality of the Civilian Board of Contract Appeals.

This is not a legal opinion as to what contractors should do during a shutdown; rather it’s an effort to direct you toward some useful information.