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DOL Proposes Extending Delay on Prevailing Wage Rule

March 18, 2021

Proposed Changes 

The Department of Labor (DOL) has proposed delaying the effective date of the rule ‘Strengthening Wage Protections for the Temporary and Permanent Employment of Certain Aliens in the United States by 18 months.

This prevailing wage rule was put forward in the final weeks of the Trump administration. As of now, wage minimums would increase as follows:

  • I)17th percentile to 35th percentile;
  • II) 34th percentile to 53rd percentile;
  • III) 50th percentile to 72nd percentile;
  • IV) 67th percentile to 90th percentile

These changes were to be phased in over 18-months, beginning on July 1, 2021.

DOL’s proposal would change the effective and transition dates so that the effective date would be November 14, 2022, and the transition date would be January 1, 2023, instead of May 14, 2021, and July 1, 2021, respectively. Additionally, the proposal includes one-year delays for each subsequent transition date, revising them to January 1, 2024, January 1, 2025, and January 1, 2026.

DOL proposes this delay to provide the appropriate time to complete a comprehensive review of the Final Rule. The proposal also states the Department will consider the comments and concerns raised in the original 60-day notice of proposed rulemaking in the Federal Register, including those which point to sources that were used as the basis for this rule which have since been revoked or rescinded.

From the Department of Labor: “The Department has considered allowing the rule to take effect pending its review and the assessment of potential new rulemaking; however, the Department thinks the concerns discussed above call into question fundamental aspects of the rulemaking to such a degree that the fairest and most prudent approach is to propose this delay rather than allow the rule to take effect without seeking additional public input.”

Next Steps for the Public 

The document is scheduled to be published in the Federal Register on March 22, 2021, at which time DOL will accept comments for 30 days here, http://www.regulations.gov.

Additionally, the Department intends to issue a separate request for information (RFI) for public input on the prevailing wage regulation, potentially leading to further changes to the rule’s substance and its implementation.

Impact 

Specific to the timeline, if the rule is delayed, the current prevailing wage rules and rates will remain until the transition period begins on January 1, 2023. DOL, with a possible RFI, has opened the possibility of other potential changes to the timeline and substance of the regulations.