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The Contractors Plan

USDOL Announces Proposed Overtime Update

March 12, 2019 Written by: Kevin Jackson

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/.

The Contractors Plan

2018 Construction Spending Update

March 05, 2019 Written by: Kevin Jackson

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

The Contractors Plan

Forty-Two Percent Of Americans Struggle To Save For Retirement

February 25, 2019 Written by: Kevin Jackson

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.

The Contractors Plan

State of the Union: Calls for Unification Around Infrastructure

February 13, 2019 Written by: Kevin Jackson

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.

The Contractors Plan

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

February 01, 2019 Written by: Brittney Greer

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.

The Contractors Plan

House Transportation & Infrastructure Committee Aims to Pass Infrastructure Bill

January 23, 2019 Written by: Brittney Greer

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.

The Contractors Plan

It Appears The Government Shutdown Has No Apparent End In Sight

January 16, 2019 Written by: Brittney Greer

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.

The Contractors Plan

Survey Shows Construction Industry Salaries Are On The Rise

January 07, 2019 Written by: Brittney Greer

In December, the National Center for Construction Education and Research (NCCER) announced results from their 2018 Construction Craft Salary Survey which indicates that salaries are on the rise in the construction industry. Findings also showed that skilled craft professionals continue to earn high wages.

The survey shows that in 2018 the annual salaries ranged from $47,771 to $92,523; up from 2015 when the range was $47,166 to $88,675. Findings also indicated that since 2015 the majority of the individual craft positions experienced an increase of 4-20 percent in their annual salaries.

Currently, the highest earning position remains that of project managers at $92,523 and supervisors at $88,355, while numerous professionals are earning over $65,000 such as combo and pipe welders, instrumentation technician, and industrial electrician. Two positions which saw the most dramatic pay increase from 2015 were HVAC technicians, up 20 percent, and sheet metal worker, up 18 percent.

One hundred thirty-two companies, representing 353,503 employees from the commercial and industrial construction industries, voluntarily provided data for this survey. Figures in the study represent average annual salaries for 32 specific individual craft areas, not including overtime, bonuses, per diem or other incentives.

The Contractors Plan

E-Verify Inaccessible Due to Government Shutdown

December 27, 2018 Written by: Brittney Greer

Currently, employers will not be able to access their E-Verify accounts and services due to the federal government shutdown. The E-Verify program is run by the Department of Homeland Security (DHS) which is one of the agencies affected by the shutdown and until funding for the government is resolved these services will remain inaccessible. In the meantime, employers should plan to keep track of all new hires during this shutdown.

This means that while E-Verify is unavailable, employers will not be able to access their E-Verify accounts to create an E-Verify case, enroll ins E-Verify, view or take action on any case, add or edit any user accounts, reset passwords, terminate accounts or run reports. Also, employees will be unable to resolve E-Verify Tentative Nonconfirmations (TNCs).

Employers should also be aware that many upcoming webinars have been canceled and that there will be no telephone or email support during this time.

DHS recognizes that this has a significant impact on operations, and to help minimize the burden on both employers and employees they will be implementing the following policies:

  • The “three-day rule” for creating E-Verify cases is suspended for cases affected by the unavailability of E-Verify.
  • The period during which employees may resolve TNCs will be extended.
  • DHS will provide additional guidance regarding “three-day rule” and period to resolve TNCs deadlines once operations resume.
  • Employers may not take adverse action against an employee because the E-Verify case is in an interim case status, including while the employee’s case is in an extended interim case status due to the unavailability of E-Verify.
  • Federal contractors with the Federal Acquisition Regulation (FAR) E-Verify clause should contact their contracting officer to inquire about extending federal contractor deadlines.

The government shutdown may continue into the new year so employers should implement methods for keeping track of new hires and employee issues so that cases can be created once the system is back online. DHS also suggests the use of several of their free E-Verify resources which can be found at https://www.e-verify.gov/e-verify-and-e-verify-services-are-unavailable

The Contractors Plan

Building Blocks For Retirement: Market Volatility

December 20, 2018 Written by: Brittney Greer

The stock market has exhibited significantly higher volatility thus far in the final quarter of 2018, with large up and down swings. This volatility is being driven by a number of different factors including uncertainty with the Federal Reserve’s potential interest rate path for 2019, the Trump administration tariffs proposal, the Brexit situation in Europe, and potentially slowing U.S. corporate earnings growth, among other factors. However, it is important to note that, in general, company fundamentals and global economic growth remain solid to strong.

Please click here to read the full document provided by Pentegra Retirement Plan Services.