Avoiding Cascading Effects: Why Suspension of The Davis-Bacon Act May Allow Forced/Exploited Labor

Avoiding Cascading Effects: Why Suspension of The Davis-Bacon Act May Allow Forced/Exploited Labor

Avoiding Cascading Effects: Why Suspension of The Davis-Bacon Act May Allow Forced/Exploited Labor

This blog post is Part 1 of a 3 part series on the intersection of human trafficking and disaster response by Benjamin Thomas Greer, JD, a subject matter expert in the field of human trafficking and child sexual exploitation; specifically instructing and developing human trafficking courses for law enforcement and emergency management personnel for the California Governor’s Office of Emergency Services.

Emergency responses after a major incident include many types of teams, tasked with responding to catastrophic events to save lives and then restore and rebuild communities. The U.S. Government and FEMA are the backbone of that response in the United States and the government has a series of procedural safeguards passed over decades to deter labor exploitation in government contracts across the board. However, when not fully and consistently imposed, it is impossible for these safety measures to ensure the stability and dignity of workers. When exceptions are made during disasters, even with right intentions, it can allow exploitation to slip in and workers to find themselves in modern slavery. As the frequency and intensity of disasters seem poised to continue, the need to incorporate a research based anti-exploitation mitigation plan into any disaster response system comes into sharp focus.

When disaster strikes, post-disaster rebuilding efforts in the U.S. often include the suspension of the Davis-Bacon Act (DBA), a 1931 United States federal law that established the requirement of paying the local prevailing wages on public works projects for laborers and mechanics. Despite the legislation being almost 100 years old, DBA is one of the primary tools the United States Government deploys during disaster recovery to ensure fair labor standards are met when government projects flood into the disaster hit area. 

As a piece of depression era legislation, the DBA was intended to provide and safeguard a minimum wage for employees providing services under all federal contracts at all times. The legislation came about as during the Great Depression public works’ period, when employers attempted to capitalize on the mass numbers of transient, out-of-state laborers willing to work for much lower rates than local workers. At the time, the employer friendly regulations allowed for the manipulation of local labor markets into artificially low wage sectors, undercutting the government’s economic revitalization goals. To counteract this market manipulation, Congress passed the Davis-Bacon Act in 1931 and has since amended DBA many times. The DBA applies to subcontractors and contractors employed on federally funded, or partially federally funded contracts in excess of $2,000 for the repair, alteration, or construction of public works or public buildings. The law requires contractors and subcontractors to pay their laborers no less than the locally prevailing wages and fringe benefits for corresponding work on similar projects within the project area. Additionally, it states workers must be paid at a rate of one and one-half times their regular pay rate for hours worked over 40 hours per week on prime contracts in excess of $100,000. 

Another labor market safeguard that works with the DBA is a law that requires employers to provide to the Department of Homeland Security proof that their workers are either citizens of the United States or that they are legally permitted to work in the United States. These two laws work in a symbiotic relationship to ensure taxpayer funds are supporting legitimate work while providing stable and livable wages. Without one, or both, of these legal tools, exploitation is given space to take root and thrive. However, during a national disaster these protections are subject to suspension at the President’s discretion. And as experience has demonstrated, suspension can lead to an exploitative situation for workers helping rebuild during this chaotic time.

The most notable suspension of DBA occurred after Hurricane Katrina in 2005 by former President George W. Bush. The suspension was intended to expedite hurricane recovery efforts by temporarily reducing the administrative overhead of the prevailing wages and recovery costs of higher worker standards. When urging the President to suspend the act, Republican policymakers claimed that the prevailing wage requirements under the DBA would “raise total construction costs by 38%” and urged the President to suspend the act in the face of the “massive rebuilding challenges.” As our nation faced an unprecedented challenge in its response to Katrina, this decision seemed logical on its surface. But studies have since shown that the suspension of the DBA during Katrina failed to reduce disaster response costs. In addition, the Department of Homeland Security temporarily suspended rules requiring contractors to present 1-9 forms allowing migrants to fill these roles. This left local residents estranged from the new jobs, since unlike the migrant workers, their wage expectations were in keeping with the local standards. 

The DBA was reinstated on November 8, 2005, and two weeks before the reinstatement, the White House Chief of Staff acknowledged the suspension failed to garner any savings. On top of this, when the regular policies were reinstated, President Bush did not make the provisions of the DBA retroactive. Employers who secured contracts with workers during the suspension period were not required to raise wages for those employees back to the prevailing local wage. Nor were employers required to provide any back pay at the prevailing wage rate after the reinstatement, effectively maintaining low wages and upsetting the balance of the local economy. 

Despite the ongoing controversies surrounding the DBA, for almost 100 years suspension of the act has become a central component of disaster recovery efforts in the U.S. While there are no examples in which the suspension of DBA has the intended effect of speeding up the recovery process, justifications to suspend the law continues and sometimes begins long before the disaster has even occurred. As emergency management agencies better appreciate the interplay of disasters and labor exploitation, their response must necessarily include anti-trafficking/anti-labor exploitation resiliency and mitigation planning as part of the disaster planning process. As all-risk emergency response agencies constantly evolve to address threats, anti-trafficking/exploitation preparedness provides an opportunity to demonstrate true dedication to public safety and community support. 

Towards this, the US Department of Labor should review all labor contracts entered during Davis-Bacon Act suspension periods for efficacy and best labor practice. While this legal action is done with sincere intent to foster growth after disaster, the action may have deleterious effects as demonstrated in the example of Hurricane Katrina. Subject matter experts and scholars should examine the suspension practice to evaluate if, with the advancement of technology and digitizing paperwork, the suspension can ever be justified. Alternatively, a determination should be made if another procedure can be imposed that maintains workers’ physical and economic rights through the whole post-disaster recovery process. After all, it is the recovery of the whole community, including local laborers and the economy, not just the buildings and infrastructure, that needs to be included in the execution of any relief package. 

It’s clear there is a correlation between the removal of procedural labor safeguards and unfair labor practices and even modern slavery. The challenge now is to find a counteraction to this failed policy. In his master’s thesis from the University of Chicago’s Master of Science in Threat and Response Management entitled, The Nexus Between Disaster Response and Labor Exploitation: How to Build a More Resilient and Humanitarian-Focused System, Maxwell Novoselac rightly proposes FEMA expand the Emergency Support Functions to address these issues. His recommendations include: 

Develop Emergency Support Function – Equity and Labor Rights

The emergency support functions (ESF) detailed in the National Response Framework (NRF) provide a framework for activating up to fifteen teams dedicated to common elements of a disaster that need to be addressed. Common activated ESFs include: transportation, search and rescue, long-term community recovery.

Developing and implementing an ESF dedicated to equity and labor rights will help solve both the contracting issues … and the labor exploitation issues demonstrated by this and previous studies. This ESF would be responsible for reviewing disaster related contracts for equity and labor rights red flags, developing a hotline for survivor and responder concerns of disaster operations, and providing equity and labor rights guidance for emergency operations. 

One major benefit of developing this ESF is that state, local, tribal, and territorial governments model their disaster response capabilities after the frameworks provided by FEMA. While they are not required to activate each ESF for every disaster, developing this ESF would provide a framework for smaller jurisdictions to address this issue when the disaster is not being supported by FEMA.

Emergency managers and community leaders bear an immense responsibility when attempting to restore communities impacted by catastrophic events. Anecdotal evidence and recent studies have begun to illuminate the interplay of instability following a disaster and the increase in trafficking activity within the impacted area. It is important that leaders understand how their actions can contribute to creating an exploitation friendly environment. As the frequency and intensity of disasters continue to increase, the need to incorporate a nuanced anti-exploitation mitigation plan into our disaster response system becomes ever more pressing.

Emergency managers are tasked with responding to catastrophic events to save lives and restore communities following a major incident. Their training covers responses to incidents and anticipation of the cascading events that may result from the original incident. Typical disaster management training focuses on how to respond to countless natural cascading events, such as inoperable communication systems after hurricane-related outages, or the spread of infectious disease in congregate sheltering. Unfortunately, when leaders choose to counteract these natural cascading effects with labor law suspensions, a unique, manmade, cascading effect of increased cases of labor exploitation may occur as a direct result of their actions. Whatever the intention behind suspending these protective laws, devastating harm may be inflicted on the survivors, victims, and disaster affected communities as a result. 

The nascent field of the nexus of trafficking and emergency management is becoming better known. The next crucial step is how we, as emergency management agencies, evolve our response structure to account for not just the effects of the disaster, but the increased risk to labor trafficking and modern slavery that comes hand in hand with these events. Only then will the response truly support the rebirth of strong, healthy communities instead of potentially adding to the tragedy we aim to address.  

Benjamin Thomas Greer, JD – Mr. Greer is a subject matter expert in the field of human trafficking and child sexual exploitation; specifically instructing and developing human trafficking courses for law enforcement and emergency management personnel for the California Governor’s Office of Emergency Services. Before joining OES, he served as a Special Deputy Attorney General for the California Department of Justice. Aside from his work with CalOES he is a Research Associate for the University of Cambridge’s Centre for Applied Research in Human Trafficking.


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