Prevailing Wage Payroll Reporting Software
Certified Payroll Solution
For projects that are publicly funded or backed by the government, the contractors or the subcontractors have to submit a Certified Payroll. A certified payroll typically mentions the number of employees working on the project, the type of work they do, and their prevailing wage information, which is the pay and benefits they are entitled to.
If your construction company has won a bid, it is imperative to understand how a certified payroll works and how to put together a prevailing wage payroll report. The Davis-Bacon Act of 1931 makes it mandatory for contractors to comply with certain rules or risk penalties.
The Davis-Bacon Act
The Davis-Bacon Act, also called DBA, is a federal law in the US that was passed by Congress in the 1930s. This was when the economy was impacted by the Great Depression and the competition had become intense in the market. As a result of market dynamics, workers were being hired on very low wages and this law came into being to protect them.
Under this law, contractors who win a bid of over $2000 on a government-funded construction project are required to pay their workers the prevailing wage and fringe benefits. The law also requires the contractors to complete a prevailing wage certified payroll outlining the details of the employees, their working hours and gross pay.
Is prevailing wage certified payroll software a necessity for contractors?
Although the software is not required for completion of a certified payroll, it is important that all employee details are accurately recorded. As soon an employee starts working for you, their hours need to be categorized under the designated prevailing wage at the time. Keeping a record manually leaves room for inaccuracies, therefore we recommend that a time tracking software be employed to help you with the payroll completion. There are a number of other factors that you need to take into account during the process:
Accurate and Timely
When attempting to complete any prevailing wage certified payroll reports, make sure the information contained in it is accurate and timely. This information could be anything regarding your company such as the number of employees, their contracts and the nature of the project.
Wage Determination Number
A county-based Davis-Bacon wage is listed online that could be found by putting in a Wage Determination number. This figure is a reference number that is different for every state and can help you in finding out the accurate prevailing wage by the nature of the job and location.
Some of the requirements that are to be fulfilled can get complicated, hence it is recommended that everything is double-checked as failure to submit accurate information can result in heavy penalties.
Federal Form WH-347 and its usage
A federal form WH-347 exists to make the submission of weekly certified payrolls convenient. Although its completion is not mandatory, the framework assists the contractors to check if all certified payroll requirements have been fulfilled.
Certified Payroll Requirements
Besides ensuring workers are being paid the prevailing wage, there are a number of other requirements that need to be fulfilled.
✓ The payment for Certified Payroll needs to be done weekly.
✓ The Certified payroll has to mention the Employee’s full name, address, job classification, pay rate, hours and days of work and the total payment made to them accurately.
The instructions for the accurate completion of the certified payroll form are provided by the Department of Labor. Part of complying with the DBA rules is to exactly state the Wage Determination for each employee and their job classification. While some classifications are specific like that of plumbers and bricklayers, the more general classification of workers can lead to confusion.
Points North has rate management functionality built into its software solution that can help you track an unlimited number of certified projects and manage the prevailing wage rates for each of them in one centralized spot.
Easily import prevailing wage rates into our system as well as any applicable fringe benefit amounts. Store and manage your prevailing wages by different factors — by project, by work classification, and even by employee.
Time Data Imports
Need to track daily hours worked based on job and work classification as part of your prevailing wage certified payroll reporting? Export your time data to a file format that can easily be uploaded into our system. This will automatically interact with the prevailing wage rate data in our platform to determine the appropriate pay amounts for each employee each pay period.
We are compatible with any timekeeping system capable of generating a flat file from your timecards. Our time entry imports allow for mapping your data to the appropriate fields so no specific template is required.
If you have the required information (your hours worked by day, by job, and by work classification), they can be imported without any manual modifications to your file. With those key pieces of information, we can simplify payroll processing by determining the pay rate applied to each time entry based on rules you define.
Do you have complex overtime or fringe calculations that can’t be easily performed by your timekeeping platform or your payroll solution? Our team is capable of analyzing and building your custom requirements into our platform to automate your calculation process each pay period, eliminating the need to build formulas into multiple spreadsheets or perform complicated analysis by hand.
The combination of employee daily hours worked and your prevailing wage/fringe rates set up in our platform on a job and/or work classification basis allows your calculated data to be easily exported out of our system so you can instantly upload it into your payroll solution, ensuring that your payroll gets processed on time and correctly.
Easily click a button, send data out of our system and load it into your payroll system to process payroll properly!
Violation of the Davis-Bacon Act and its repercussions
In recent years, compliance checks have become more stringent and between 2014 and 2018, back wages exceeding $1.3 billion were collected. The American Bar Association hired 350 new investigators to ensure compliance thus making sure that violations such as withholding of funds on federal contracts or its termination altogether don’t take place.
Prevailing Wage Certified Payroll FAQ
Here are some common questions regarding what the prevailing wage entails.
All workers employed on public works projects must be paid the prevailing wage determined by the Director of the Department of Industrial Relations, according to the type of work and location of the project. The prevailing wage rates are usually based on rates specified in collective bargaining agreements.
California's prevailing wage laws ensure that the ability to get a public works contract is not based on paying lower wage rates than a competitor. All bidders are required to use the same wage rates when bidding on a public works project. California law requires that not less than the general prevailing rate of per diem wages be paid to all workers employed on a public works project.
When the director of the California Department of Industrial Relations determines that the general prevailing rate of per diem wages for a particular craft, classification, or type of worker is uniform throughout an area, the director issues a determination enumerated county by county, but covering the entire area. General determinations are issued twice a year on February 22 and August 22.
When a particular craft, classification or type of worker is not covered by a general determination, the awarding body may request a special prevailing wage determination. Requests must be made at least 45 days prior to the bid advertisement date.
The date upon which the determinations of the director of the California Department of Industrial Relations go into effect. This date is 10 days after the issue date of the determination.
Projects consisting of single-family homes and apartments up to and including four stories are subject to payment of prevailing wages when paid for in whole or in part out of public funds, including federally funded or assisted residential projects controlled or carried out by an awarding body.
A process in which the awarding body or any other interested party (such as a contractor, employee, union or labor-management compliance organization) may request a written determination by the director of the Department of Industrial Relations about a specific construction project or type of work to be performed.
Compensation for all hours worked in excess of eight hours per day and 40 hours during any one week should be not less than one-and-one-half times the basic rate of pay. For specific overtime requirements, please refer to the prevailing wage determinations.
Prevailing wages must be paid to all workers employed on a public works project when the public works project is more than $1,000. If an awarding body has a labor compliance program, prevailing wages are not required to be paid for any public works project of $25,000 or less when the project is for construction work; or for any public works project of $15,000 or less when the project is for alteration, demolition, repair or maintenance work.
Carpenters, electricians, plumbers, ironworkers, flaggers, craftsmen, welders, concrete finishers, longshoremen, power equipment operators, and helpers are all job classifications that fall under prevailing wage law. Construction, waste management, and manufacturing are the industries most commonly fined for violating prevailing wage laws, due to their relevance to government construction, alteration, and repair projects.
We have direct certified payroll reporting compatibility with all of our partners: ADP, UKG, Paycor, Paychex, and Quickbooks.
We also are compatible with our time partners, including Quickbooks, Clockshark, and Raken.
With that being said, there are many other payroll companies that we have successfully worked with in the past. We have helped clients with their certified payroll reporting from Paycom, Infinisource, KTBS, CheckWriters, PDS, Stratex, Ceridian, ExtensisHR, Sanford Technology Group, Viewpoint Spectrum, and Paylocity.
Prevailing Wage Payroll Reporting Software
Points North offers reporting software that can help you ensure that the classification and other information you provide is lined up correctly. Our software solution for prevailing wage certified payroll reporting can help you in a number of ways such as accurate recording of the employee working hours and saving all their work data over time in a secure manner. Our tracking mechanism is real-time and will help you navigate information from even two years ago, easily. Get a free demo of our software.