California Prevailing Wage

The prevailing wage is a base reimburse rate that was established and is currently being supported by State and Federal law. This was made in order to ensure that prevailing wage contractors adequately compensate their construction employees involved in public work projects based on their craft and hours of work. The hourly pay rate and the fringe benefits make up the whole of the prevailing wage rate.

What You Need to Know About California Prevailing Wage

The prevailing wage laws in California ensure that a prevailing wage contractor’s ability to get a public works contract is not dependent on paying a lower wage rate than competing companies. As a prevailing wage contractor, you are expected to offer compensation not less than the prevailing wage rate to your employees. Here are some of the things you should know about the prevailing wage in the state of California:

Determining California’s Prevailing Wage Rate

The Davis-Bacon Act of 1931 is a law that requires prevailing wage contractors to pay the local prevailing wage rate to laborers and mechanics of public work projects. According to California’s prevailing wage law, the prevailing wage rate is going to be decided by using local data on the basic hourly rate paid to a majority of workers engaged in a specific craft, classification, and the nearest labor market in the area.

Issuing General Determinations of the Prevailing Wage

The general determinations of the prevailing wage rate per type of work are issued twice a year: during February 22 and August 22. Ten (10) days after the issuance of the general determinations, the prevailing wage rate will automatically be effective. Depending on your employees’ craft, specialization, and area, the prevailing wage rate may differ from others.

To have an idea of the prevailing wage rate in California with respect to the type of work that your employees do, proceed to the Director’s General Prevailing Wage Determinations by the State of California’s Department of Industrial Relations.

Public Works Project Threshold Requirement

In the state of California, prevailing wages should be paid to all employees working on a public works project when it is worth over $1000. However, should there be an awarding body elected to initiate a labor compliance program approved by the Department of Industrial Relations, for every public works project under the authority of that awarding body, the prevailing wages may not be followed. When the construction of the public work project is worth less than $25000, or if the project for demolition, repair, or maintenance work is less than $15000, the prevailing wage rate may not be applied.

Deal with Your Prevailing Wage Requirements Effectively with ARCHER JORDAN!

As a prevailing wage contractor, you are bound by the law to provide prevailing wage to your employees, from the hourly pay rate to the fringe benefits portion. Learn how to comply with the Davis-Bacon Act with the help of ARCHER JORDAN.

As one of the premier fringe benefits administrators in the country, ARCHER JORDAN will help address your inquiries about California’s prevailing wage law. Call us now at +1 888-745-0754!

5-Easy Steps to Fringe Benefit Compliance

In this FREE guide we’ll show you how to create a fringe benefit plan that secures your business