Ensures consistency with the federal Davis Bacon Act for calculation of payments for supplements and reciprocity of debarments

Summary of provisions

Section 1 -- Adds a new subdivision 3-f to Section 220 of the Labor Law, dealing with contracts involving public work, to prevent employers from using public work as a disproportionate or exclusive source of funding for benefits that are in fact continuous in nature and are part of the regular compensation for all employee work whether public or private, the Commissioner shall direct that the proper payment of supplements be calculated using an annualization methodology. In order to protect work- ers and ensure consistency of application, the Commissioner shall employ the annualization methodology utilized by the U.S. Department of Labor in calculations under the Davis Bacon Act of 1931 40 USC 276 et seq.

Section 2 - Adds a new subdivision 3 section 220-b of the labor law that states when a contractor or subcontractor is debarred for violations of the Davis Bacon Act of 1931 40 USC 3144 and 29 C.F.R 5.12,the contractor or subcontractor and any firm, corporation, partnership or association in which the person or entity owns or controls at least fifty-one per centum, shall be ineligible to be awarded any public works contract with the state, any municipal corporation, public benefit corporation or public body for a period not to exceed the period of debarment deter- mined or decided pursuant to the act. The department must provide writ- ten notice to the person or entity immediately of the ineligibility and provide them the opportunity to be heard by the department within thirty calendar days of the written notice.

Section 3 -- Amends section 103 of the general municipal law adding new subdivision 1-c that states that in determining the lowest bidder, the officer, board or agency of any political subdivision or any district charged with awarding of contracts, shall consider whether or not the bidder is debarred pursuant to paragraph b of subdivision three of section two hundred twenty-b of the labor law in making such determi- nation of the award.

Section 4 -- Establishes the effective date.

Justification

The annualization method currently utilized by the Commissioner of Labor for calculating supplemental benefits which contractors are required to provide employees who work on private and

public work projects forces contractors to either switch from providing employees with supplemental benefits (health insurance, pension, etc.) to cash payments of supplemental benefits or to pay workers at a higher overall supplement rate which includes time spent on private projects. In essence, the methodology currently utilized by the Commissioner extends the reach of the public work law to partially cover private work as well. The rate for supplements on private work projects should be determined through forces of the free market economy, rather than the rates required for public work projects. The methodology prescribed by the Commissioner of Labor frustrates the purpose of the prevailing wage law by extending it beyond public work. The federal methodology for annualization of benefits under the Davis Bacon Act is fair and does not penalize employers for doing both public and private work. As such, this legislation would clarify that the method utilized by the federal government under the Davis Bacon Act is the method that will be applied in this State.

Legislative history

S.4018 (2011-12), Held in Labor S.4309/A.2143 (2009-10), Held in Labor A.5704 (2007-08), Held in Labor A.11455 (2006), Referred to Labor

Fiscal implications

No fiscal implications.

Effective date

This act shall take effect on the one hundred twentieth day after it shall have become a law and shall apply to all contracts and agreements entered into on and after such date. Effective immediate- ly, the addition, amendment and/or repeal of any rule or regulation necessary for implementation of this act on its effective date is authorized and directed to be made and completed on or before such effective date.