3 Key Differences Between Certified Payroll and Wrap-Up Payroll

Person Holding Money for Certified Payroll

Contractors might be asked to submit two different types of payroll for work performed on a specific contract or project throughout a construction project. These two types of payroll are called Certified Payroll and Wrap-Up Payroll. Although this might seem cumbersome, these two types of payroll are used for different purposes, and there are many differences between Certified Payroll and Wrap-Up Payroll.

What is Payroll?

Payroll refers to the employees you have paid as well as employee information. It is the amount you pay employees during each pay period. It is put in place to:

  • Keep track of worked hours
  • Calculating wages
  • Printing and delivering checks
  • Paying government employment taxes
  • Withholding taxes and other deductions

Payroll systems manage everything related to the process of:

  • Paying employees
  • Filing employment taxes

Main Differences Between Certified Payroll And Wrap-Up Payroll

Certified Payroll

1. What is certified payroll?
Certified Payroll is a detailed payroll report on a federal form, also called WH-347. A Certified Payroll report is a special payroll report that contractors working on government-funded construction projects or public works must submit weekly.

2. What does a certified payroll contain?
It contains various types of information ranging from:

  • Employee's name
  • Employee's wage rate
  • Benefits to which they are entitled
  • Employee's social security number
  • Employee's number of worked hours on a specific project

Certified Payroll report shows all employees on a specific job and gives a snapshot of gross wages, hours, and withholdings weekly.

3. What does its inaccurate information cause?

An authorized person within the company submits Certified Payroll and certifies that the information and wages are correct, along with a statement of compliance. Any falsification of this data can cause criminal prosecution.

Wrap-Up Payroll

1. What is a wrap-up payroll?

Wrap-Up Payroll, also known as Reportable Payroll, is what a company must report to its own Workers Compensation Carrier for the state in which it performs the work. Wrap-Up Payroll reports only include unburdened straight-time payroll. It is known as Limited or Reportable Payroll and does not include any overtime pay.

2. What does a wrap-up payroll require?

Wrap-Up Payroll requires the contractor to add all the accumulated hours for a given Workers Compensation class code, time period, and all the reportable wages for the employees working on a contract or project. Then, this information is submitted to the Wrap-Up Administrator who is handling the project.

3. What does its inaccurate information cause?

Wrap-Up Payroll information must be accurate. Incorrect reporting can result in accounting errors and cause the carrier to report the inaccurate information to bureaus, which can affect your Experience Modification Rate (EMR).

The Bottomline

Not all payrolls are created equal as there are many differences between Certified Payroll and Wrap-Up Payroll. Certified Payroll is a company's accounting of everything paid out under a contract performed for a government client, while Wrap-Up Payroll is what a company has to report to their Workers Compensation Carrier for the state in which they are doing the work.

Build and manage a better workforce with integrated HR solutions from ADP Marketplace partners like Points North.

Certified Payroll Reports: A Guide to Payroll Reporting and Compliance

April 25, 2023
President Biden's 2022 budget proposal includes over $2.3 billion in infrastructure spending. Government agencies at...

Directions and Instructions for Certified Payroll Reporting

August 8, 2019
If you win a contract for the government then you must submit a certified payroll report every week to the project’s...

Certified Payroll Guide

September 4, 2020
WHAT IS CERTIFIED PAYROLL? Contractors (and subcontractors) are compelled to send Certified Payroll Records (CPRs) to...