Prevailing Wage Law for Construction Contractors

Construction Contractors

Prevailing wage laws state that when contractors or subcontractors are hiring workers for public jobs, they should pay them at least as much as the local, prevailing wage rate. This rate acts as a minimum constraint for construction workers working in any geographical area. Prevailing wage laws prevents labor exploitation and help ensure that construction workers are not underpaid. One of the goals of prevailing wage laws is to ensure that there is no discrimination between local and non-local labor and that the minimum cost of labor will remain the same.  


The Davis-Bacon Act was passed to define the prevailing wage requirements for federal projects. The Davis-Bacon Act is applicable on all the 50 states when working on federal construction projects.  Related Davis-Bacon Acts were also passed later for most states to help cover holes in the Davis-Bacon act itself. As of now, 32 states currently have written prevailing wage laws. 


Roles and Duties of the Contractor

Contractors play a crucial role in ensuring compliance with prevailing wages and the Davis-Bacon Act. One of the primary duties of a contractor is to accurately determine the prevailing wage rates for each job classification involved in the project. They are responsible for ensuring that workers receive the correct wages and benefits as specified in the Davis-Bacon wage determinations. To accurately gather prevailing wages, find a reliable source such as the DOL website or a local government website. 


Contractors must also keep detailed records of all hours worked, wages paid, and fringe benefits provided to each worker. Contractors may also need to submit certified payroll reports to the contracting agency on a regular basis. These reports provide a detailed breakdown of the wages paid to each worker, including their job classifications and any applicable fringe benefits. By submitting these reports, contractors demonstrate their compliance with prevailing wage laws and the Davis-Bacon Act. These documents must be accurate and correctly filed to stay compliant with prevailing wages, which is why many companies turn to solutions such as Points North’s Certified Payroll Reporting to handle proper submission and form generation. 

Rights of the Worker

As a worker, how do you investigate if you are being paid less than minimum wages? For federal projects, the worker can call the Wage and Hour office hotline, send an email containing all the related questions and concerns here, or visit their local office.  


If a worker finds that they are underpaid they have the right to make a claim. First, however, it is suggested that they should consult the prime contractor about this. The payment discrepancy may be an accounting error or a small dispute that can be dealt with internally. If the issue isn’t solved internally, it is suggested that the worker should contact the US Department of Labor or the State’s Department of Labor. No documentation is required to start the claim. 

Looking for a way to more easily track prevailing wages as a contractor? Let us help you stay compliant under the Davis-Bacon Act. Thousands of contractors throughout the country rely on Certified Payroll Reporting to simplify their prevailing wage reporting, join them today by clicking here to contact us. 

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