Prevailing Wage (Prevailing Wage)
The locally prevailing hourly wage and fringe benefit rate that the US Department of Labor (or state labor departments) determines for each job classification and geography.
Definition
Prevailing wage requirements come from Davis-Bacon (construction) and the Service Contract Act (services) at the federal level, plus state "Little Davis-Bacon" laws. The US Department of Labor publishes Wage Determinations on SAM.gov listing rates by job classification, geography, and project type. Contractors must pay at least the published rates plus fringe benefits.
When it applies
Applies to federal Davis-Bacon construction and SCA service contracts. Many states (California, New York, Washington, Massachusetts, Maryland) have broader prevailing-wage requirements that apply to state-funded work even without federal money. Bid pricing must reflect prevailing-wage labor cost, which often runs 30-100% higher than equivalent private-sector wages.