This year, the Labor Department’s construction agenda ran into a wall in federal court — a wall built from its own overreach. The biggest blow came in June, when Judge Sam Cummings of the Northern District of Texas blocked key parts of the department’s 2023 Davis-Bacon overhaul — the first comprehensive rewrite of the prevailing-wage rules in forty years. The rule, effective October 2023, changed more than fifty provisions governing wages on federal construction projects. The Associated General Contractors sued — and won.
The Davis-Bacon Blow
The court blocked three provisions. First, an “operation of law” clause that would have read Davis-Bacon wages into federal contracts retroactively, even when the government forgot to include them. Second, an expansion of prevailing wages to truck drivers and other workers off the job site, though the 1931 Act covers only “mechanics and laborers” on the project. Third, a narrowing of the material-supplier exemption. Judge Cummings did not mince words: the department had committed “egregious violations” of the Constitution’s Take Care Clause, usurping Congress’s lawmaking power.
The Overtime Rule Falls
Then came November. On November 15, Judge Sean Jordan of the Eastern District of Texas struck down the Labor Department’s entire 2024 overtime rule nationwide. It would have raised the salary threshold for white-collar exemptions from $684 a week to $1,128 by January, reclassifying millions of salaried workers as overtime-eligible. The court held the department had exceeded its authority by letting the salary level displace the duties test in the Fair Labor Standards Act, and struck down the rule’s automatic pay increases every three years as unlawful too.
The Common Thread
The common thread is the Supreme Court’s June decision in Loper Bright, ending forty years of Chevron deference — the doctrine that courts defer to agencies’ readings of ambiguous statutes. Judges no longer give the Labor Department the benefit of the doubt; it must now prove its reading of the law is the best one. In 2024, twice, it could not. With the incoming administration unlikely to defend either rule, both look set to stay sunk.