BEAD Broadband Funding Guide: Labor standards and workforce readiness

Applicants applying for BEAD funding need to engage with significant labor and workforce requirements. There are three sections to be aware of in your state’s plan.

 1. Fair labor practices

The BEAD funding rules require fair labor practices to be one of three primary criteria in the scoring rubric, making up 10-15% of the total points in most states. Eligible Entities will give points to projects based on a demonstrated record of compliance, and plans to be in compliance with federal labor and employment laws (including contractors and subcontractors). 

2. Labor standards and protection

Beyond the mandatory fair labor practices, each Eligible Entity will list additional labor standards and protections and note which are mandatory for applicants. States vary greatly on which of the following are mandatory: 

Applicants need to pay particular attention to prevailing wage regulations at both the federal and state levels. The Davis-Bacon and Little Davis-Bacon rules set wage standards for construction projects, and compliance with these rules is often highly scrutinized.

If the use of prevailing wages is required by an Eligible Entity, applicants should place significant effort into planning for the increased personnel costs associated with compliance and establishing clear documentation for all workers, including contractors and subcontractors. 

3. Workforce readiness (BEAD Requirement 9)

Most of the workforce readiness section details what Eligible Entities need to do to support BEAD construction with workforce readiness plans. However, Eligible Entities may pass some of these responsibilities on to applicants by requiring them to certify commitment to strategies like: 

• Recruiting a diverse workforce
• Workforce union status
• Use of apprenticeships to ensure a qualified workforce 

While this is not an exhaustive list, be aware that applicants will need to write narratives explaining how they plan to provide equitable employment opportunities. Some states even incorporate workforce readiness into their scoring rubric as a secondary criteria. 

Importantly, applicants need to keep in mind what documentation, actions, and metrics need to be reported post-award to prove compliance.

Questions to ask before you start your application

What labor practices are mandatory or optional for your state? 

• It is important to know if and how your state will consider any labor commitments legally binding if your project is chosen. 

Do you have the documentation (listed below) needed to demonstrate compliance with federal labor and employment laws? 

• Records of compliance with and any violations of federal labor and employment laws over the last three to five years, as well as the records of any other entities that will participate in the project. 
• A formal certification of compliance from an officer/director-level employee.
• Wages and payment practices for any employees that will be involved in the construction of the new broadband network. 

Does your state require a fair labor compliance narrative as part of its prequalification requirements?

• If so, they will need to be prepared before the applicant selection process.

What are the financial implications of agreeing to certain labor standards for your organization? 

• Some rural ISPs may see labor costs increase 20-30% if prevailing wages are provided to employees who are engaging in BEAD activities, especially if these wage increases need to be extended across the organization to all employees.

Strategies for success in this category

If you are a new entrant and do not have past labor compliance records, you’ll need to focus on future plans to comply. 

• Consider incorporating labor protections that states encourage, but do not require to set you apart from other applicants and show commitment to equitable and safe practices. 

The strongest way to ensure compliance is to include all requirements in your agreements with contractors and subcontractors.

• Post-award reporting and compliance will take more administrative time than applying to BEAD. Think about how you can ensure contractors comply with requirements. This may mean creating penalties for noncompliance, or even for lack of adequate and timely reporting. 

Start building relationships with and vetting vendors before the application portal opens. 

• Getting a head start on these contracts and agreements will help you see how rules will impact your score and financial plan. 

Questions? Get in touch. 

If you have any additional questions or would like help with your BEAD application, please contact us.