What Is a Certified Payroll and How Do You File It?

Government Construction Office

All federal and federally-aided construction contracts and subcontracts are obliged to submit weekly payrolls. It reports employee information and has been made available for the convenience and documentation of contractors and subcontractors. In order to satisfy the requirements of Regulations, Part 3 and 5 (29 C.F.R Subtitle A), it is important that Form WH-347 is filled. 

The Copeland Act (40 U.S.C. 3145) prohibits forceful termination or dismissal from employment by coercion, intimidation, or threat of a person involved in the construction and repair of public work. Under this Act, the contractors and subcontractors are supposed to submit a weekly statement outlining the wages paid to each employee in the previous week. The payrolls are to be submitted to the Federal Agency responsible for financing the construction project. The contractors also need to share a signed ‘Statement of Compliance’ along with the payrolls which are a declaration that all information included in payroll sheets is complete and true. It is also an assertion that laborers and mechanics working under them have been compensated with wages that meet the criteria of the Davis-Bacon Act. 

The Davis- Bacon and related acts require the contractor to pay the prevailing wage or more. Fringe benefits are decided by the Department of Labor and the employers have to comply with them. The employer or the contractor can pay fringe benefits to the workers by including it in the bona fide benefit plans or funds. They can also make this payment in cash to the workers who are eligible for it. 

A contractor is obliged to clearly state the money that is being paid to each mechanic or laborer. This money can include the basic pay rate and the cash paid in lieu of fringe benefits. It also defines the form of compensation as well. If you are new to the preparation of payroll, we can walk you through each section for better understanding.

-  The form has space where the contractor or subcontractor is supposed to fill in information such as the name of the firm and check the box that best describes your firm. There is an address box as well where you have to enter the location of your business. 

- The payroll numbers on the form begin with the number 1 where you have to enter what is the payroll number of the submission 

- It is to be stated clearly when the work week ends

- The project and location field on the payroll form is pretty self-explanatory and so I the name of the project and contract number under which the employees are being filed. 

The form consists of 9 columns in total and we’ve explained each of them in detail below:

Column 1

Each worker should have an inpidual ID. This is usually the last four digits of their Social Security Number. The ID and the name of the worker are to be stated in the first column and are mandatory parts of the form.

Column 2

Column 2 is not mandatory and is supposed to include withholding exemptions if any. It exists for the convenience of the contractor so they can keep a record.

Column 3

In the third column, you are supposed to classify what work is being done by each of the employees. If you are not sure which category each of your employees fall into, you can refer to the classification and minimum wage schedule set in the contract. If you require further clarification, a contracting officer or an agency representative will be able to help you out. Sometimes an inpidual can be classified into more than one category. In such a case, there needs to be an accurate breakdown of the number of hours they were employed for a particular form of work classification. Since the work hours lie in different categories, they will be submitted as separate entries on the form.

Column 4

The fourth column has to have information about the hours of service of the employee. You will have to state the day, date, normal working hours, and any overtime hours of each of the workers. As per the Contract Work Hours Standard Act, any hours that exceed 40 in a week are considered overtime.

Column 5

Column 5 is the accumulation of total working hours including overtime. 

Column 6

The per-hour rate is to be stated in Column 6. This includes the fringe benefits or cash that is paid in lieu of fringe benefits. The straight time section has to include the actual hourly pay rate whereas the fringe benefit amount is to be written separately. The overtime hourly rate has to be mentioned as well which should not be less than the basic pay rate.

Column 7

If the worker has earned money on the projects other than the one mentioned on the payroll, then their total earnings have to be written down.

Column 8

This column is for mentioning deductions and is further subpided into five. If there are more than five deductions, you can make use of the first four columns and under the ‘other’ column mention the balance deductions. Make sure that any deductions made should be as per the Copeland Act Regulations, 29 C.F.R, Part 3. If the employee has been involved with other jobs as well, their actual deductions have to be from their weekly gross wage.

Column 9

The net total paid to the employee after the deductions has to be added to this column.

Statement of Compliance and Fringe Benefits and Section 4(c)

The ‘Statement of Compliance’ that has to be submitted with the form does not have to be notarized but is subject to penalties under the 18 U.S.C. § 1001 if the information provided is untrue.

Payment or non-payment of fringe benefits has to be predetermined and clearly mentioned. The overtime pay should be more than the sum of the basic predetermined rate and should include the half time premium on the basic pay.

If a contractor is not making the payment as per the wage determination, they have to pay the deficient amount to the worker as cash and state it in Section 4 (c) of the form.

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.

Most Common Certified Payroll Report Mistakes And How to Avoid Them

October 28, 2020
Davis-Bacon Act and the respective state “mini Davis-Bacon Acts” impose a condition on construction projects. According...

Avoiding Davis-Bacon Act Violations

September 3, 2022
Did you know that if a project receives more than $2,000 in government funding you could face a compliance obligation?...

Certified Payroll Reporting: Key Things You Need to Know

March 22, 2023
If you are a contractor working on a federally funded project, you may be required to submit certified payroll reports...