Prevailing wage

The federal Davis-Bacon Act applies to federally funded or assisted construction contracts over $2,000. The Department of Labor publishes wage determinations by county and type of construction, listing the required rate for each classification, such as carpenter, electrician or laborer.

Many states have their own prevailing wage laws for state and local public work, often called “little Davis-Bacon” acts, with their own rates and thresholds. Some states have none. The bid documents for a public job should say which rules apply.

On covered jobs, contractors and subs submit certified payroll each week, showing each worker’s classification, hours, pay and fringe benefits. The federal form is the WH-347, and states may have their own. Misclassifying or underpaying workers can lead to back pay, penalties and being barred from public work.

Fringe benefits can be paid as cash or into qualifying benefit plans. Price labor from the wage determination, not from your usual rates, since they can differ a lot, and add the office time certified payroll takes.