ArtsAutosBooksBusinessEducationEntertainmentFamilyFashionFoodGamesGenderHealthHolidaysHomeHubPagesPersonal FinancePetsPoliticsReligionSportsTechnologyTravel

Is there a defined process to arrive at the costs of public contracts?

Updated on November 11, 2014


The process of bidding on public contracts through government entities is not a simple one. The philosophy of prevailing wages for government contracts impacts the bidding process potentially makes it difficult for businesses to adequately bid a viable contract. Examples have been in the news where a company did not have the winning bid sued on the bases that a prevailing wage for the work to be done was not included in the contractual language. One example resulted in the contract being nullified and the company going out of business simply for the reason they could not pay the fines being imposed. Contractual language should be firm with regards to what was proposed and accepted. Changing the terms and conditions of a contract by reason of a lawsuit sets a destructive precedent. The result of and if a contractor is awarded a contract other bidders can sue if it is felt violations are involved with the requirements for a prevailing wage.

The term prevailing wages is one which bears understanding and possible action by us as individuals and perhaps as our elected officials and/or appointed officials. According to businessdictionary.com the definition of a prevailing wage is: “Trade and public work wages paid to the majority of workers in a specific area. The prevailing was is usually an hourly wage and determines overtime as well as benefits for laborers in that field.”

Given the definition of what is a prevailing wage it is unclear who determines what this wage is from one location to another and one state to another. Many states have their own prevailing wage legislation but what data goes into making this determination is vague to say the least. The requirement for prevailing wages is typically included in public contracts either at the federal, state or local level. It is understandable that there should be a decent wage for work being done whether it is for a government contract or a private contract. The issue should not be about how much is paid but the quality of the work to be performed based on the reputation of a contractor to do the job.

The Department of Labor under their employment and training website identifies the prevailing wage paid to similarly employed workers in a specific occupation in the area of intended employment. Something is missing in this designation of prevailing wages. It is not identified what data is utilized to determine the required wage to be paid. In another aspect contracts that are signed by government entities should be held to be firm contracts. Organizations which did not receive a contract should not have the right to negate a contract legitimately signed by government and contractors through lawsuits and courts should not grant them this power through their decisions.

In further research there is some evidence that prevailing wages amount to union wages and is a push by government which some feel is inappropriate and inefficient. The federal law regarding prevailing wages is through the Davis Bacon Act. The objective of establishing a prevailing wage may not necessarily be a bad thing it is the details within the process or the lack of it in how a prevailing wage is to be determined. According to what could be found the objective was to prevent contractors from bidding such a low price without the capability of performing the requirements is a valid concern.

In doing some additional research I could find not find the source of any wage data being collected to determine a prevailing wage which for the same occupation is different from one state to another. I agree that wages will be different from one state to another but again the source of the data for any occupation in any state is not clearly defined. Some states reference the Davis Bacon Act which is part of the Department of Labor. If the data is based on union wages it omits data from non-union organizations which would impact the wage determination process. It is true that this act relates to contracts from government entities especially those with government funding. If the process to determine the level of wages to be paid on government contracts is flawed which at this point appears to be the case, the price being paid in government contracts may be higher which equates to an overpriced contract and extra expenses which increasing the cost of government operations needlessly. Government has a way of creating processes which are not clearly defined to achieve the end objective.


Comments

    0 of 8192 characters used
    Post Comment

    No comments yet.

    working

    This website uses cookies

    As a user in the EEA, your approval is needed on a few things. To provide a better website experience, hubpages.com uses cookies (and other similar technologies) and may collect, process, and share personal data. Please choose which areas of our service you consent to our doing so.

    For more information on managing or withdrawing consents and how we handle data, visit our Privacy Policy at: https://hubpages.com/privacy-policy#gdpr

    Show Details
    Necessary
    HubPages Device IDThis is used to identify particular browsers or devices when the access the service, and is used for security reasons.
    LoginThis is necessary to sign in to the HubPages Service.
    Google RecaptchaThis is used to prevent bots and spam. (Privacy Policy)
    AkismetThis is used to detect comment spam. (Privacy Policy)
    HubPages Google AnalyticsThis is used to provide data on traffic to our website, all personally identifyable data is anonymized. (Privacy Policy)
    HubPages Traffic PixelThis is used to collect data on traffic to articles and other pages on our site. Unless you are signed in to a HubPages account, all personally identifiable information is anonymized.
    Amazon Web ServicesThis is a cloud services platform that we used to host our service. (Privacy Policy)
    CloudflareThis is a cloud CDN service that we use to efficiently deliver files required for our service to operate such as javascript, cascading style sheets, images, and videos. (Privacy Policy)
    Google Hosted LibrariesJavascript software libraries such as jQuery are loaded at endpoints on the googleapis.com or gstatic.com domains, for performance and efficiency reasons. (Privacy Policy)
    Features
    Google Custom SearchThis is feature allows you to search the site. (Privacy Policy)
    Google MapsSome articles have Google Maps embedded in them. (Privacy Policy)
    Google ChartsThis is used to display charts and graphs on articles and the author center. (Privacy Policy)
    Google AdSense Host APIThis service allows you to sign up for or associate a Google AdSense account with HubPages, so that you can earn money from ads on your articles. No data is shared unless you engage with this feature. (Privacy Policy)
    Google YouTubeSome articles have YouTube videos embedded in them. (Privacy Policy)
    VimeoSome articles have Vimeo videos embedded in them. (Privacy Policy)
    PaypalThis is used for a registered author who enrolls in the HubPages Earnings program and requests to be paid via PayPal. No data is shared with Paypal unless you engage with this feature. (Privacy Policy)
    Facebook LoginYou can use this to streamline signing up for, or signing in to your Hubpages account. No data is shared with Facebook unless you engage with this feature. (Privacy Policy)
    MavenThis supports the Maven widget and search functionality. (Privacy Policy)
    Marketing
    Google AdSenseThis is an ad network. (Privacy Policy)
    Google DoubleClickGoogle provides ad serving technology and runs an ad network. (Privacy Policy)
    Index ExchangeThis is an ad network. (Privacy Policy)
    SovrnThis is an ad network. (Privacy Policy)
    Facebook AdsThis is an ad network. (Privacy Policy)
    Amazon Unified Ad MarketplaceThis is an ad network. (Privacy Policy)
    AppNexusThis is an ad network. (Privacy Policy)
    OpenxThis is an ad network. (Privacy Policy)
    Rubicon ProjectThis is an ad network. (Privacy Policy)
    TripleLiftThis is an ad network. (Privacy Policy)
    Say MediaWe partner with Say Media to deliver ad campaigns on our sites. (Privacy Policy)
    Remarketing PixelsWe may use remarketing pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to advertise the HubPages Service to people that have visited our sites.
    Conversion Tracking PixelsWe may use conversion tracking pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to identify when an advertisement has successfully resulted in the desired action, such as signing up for the HubPages Service or publishing an article on the HubPages Service.
    Statistics
    Author Google AnalyticsThis is used to provide traffic data and reports to the authors of articles on the HubPages Service. (Privacy Policy)
    ComscoreComScore is a media measurement and analytics company providing marketing data and analytics to enterprises, media and advertising agencies, and publishers. Non-consent will result in ComScore only processing obfuscated personal data. (Privacy Policy)
    Amazon Tracking PixelSome articles display amazon products as part of the Amazon Affiliate program, this pixel provides traffic statistics for those products (Privacy Policy)
    ClickscoThis is a data management platform studying reader behavior (Privacy Policy)