Davis Bacon Related Acts

The wage rate determinations issued are good for the duration of the project. Since wage determination is multi-year, a contract is “on-notice” as wage increases come into effect. The contractor must pay increases as noted on the determination issued by the Director of Labor accordingly.

The threshold for public works construction projects under the prevailing wage law covers:

• Projects in value excess of $2000 that involve a state or country governmental contracting agency,
• Contracts that underwent a formal bid process, lease arrangement, or purchase order voucher
• Warranty work performed by a contractor or subcontractor.

Under Hawaii Prevailing Wage Law, overtime for public works projects must be paid for all hours worked on Saturdays, Sundays, a legal state holiday, or on any other day for work more than eight hours. The overtime payment is at a rate of time and one-half. These are the recognized holidays in Hawaii:

• Jan 1, New Year’s Day
• 3rd Monday of Jan, Martin Luther King Jr. Day
• 3rd Monday of Feb, Presidents’ Day
• Mar 26, Prince Kuhio Day
• Friday before Easter Sunday, Good Friday
• Last Monday of May, Memorial Day
• Jun 11, King Kamehameha Day
• Jul 4, Independence Day
• 3rd Friday of Aug, Admission Day
• 1st Monday of Sept, Labor Day
• Nov 11, Veterans’ Day
• 4th Tuesday of Nov, Thanksgiving Day
• Dec 25, Christmas

Aside from the days stated above, overtime compensation must also be paid for all election days in the country where the election is held (except for primary and special election days), and also on any day that is proclaimed a holiday by the President or Governor. Lastly, note that the Hawaii Prevailing Wage Law does not require different wage rates for shift differentials (i.e. for working different shifts during the day).

The law applies to the transport of materials, supplies or equipment to and from a public work site, or between two public work sites, or between a public work site and a dedicated site, as long as they are performed by someone employed at the job site.
The provision of a fringe benefit contribution does not include compensation for lodging.

Yes. The Prevailing Wage Law in Hawaii requires workers to be paid any combination of the basic hourly wage rate and fringe benefits to meet the applicable prevailing wage rate.

A fringe benefit is a contribution towards a fund, plan or program that is made by a contractor to a trustee or third person. These programs, such as medical or life insurance and pension, provide benefits to a laborer or mechanic. The fringe benefits required under the Prevailing Wage Law must:

• Fall into one of 6 allowable categories: health and welfare, life or disability insurance, vacation and holiday pay, apprenticeship or similarly-approved programs, pensions, other bona fide benefits as determined by DLIR
• Be made at least monthly to the eligible fund, plan or program, such as HMSA
• Be paid for all hours worked, including for overtime

Yes. Apprentices and trainees are required to be parties to an agreement registered with or recognized as a U.S. Department of Labor and Industrial Relations, Workforce Development Division nationally-approved apprenticeship program. It could also be a program recognized by the Hawaii Department of Labor, Industrial Compliance, in order for the apprentices and trainees to be paid apprentice or trainee rates.
There is an allowable ratio of apprentices or trainees to the number of workers in the same trade classification given any public work under the same employer. This ratio is given by the Department of Labor and Industrial Relations. To be clear, any registered or recognized apprentice will not be considered a journey-worker for the ratio requirement, even if they receive the journey-worker rate.
Under Chapter 104, the “summer hire” classification or any temporary summer help is not recognized. They must be classified and paid according to the work performed, using the closes wage rate schedule listed.

Government contractors must submit a Certified Copy of Payrolls to the contracting agency weekly. They are also responsible for submitting the certified copies of the payrolls of the subcontractors of that project. The certification affirms that the payrolls are complete and correct, that the appropriate wage rates are listed, and that the classifications used match the work performed.
These records contain the name and home address of each employee, as well as their classification, weekly straight time and overtime, daily and weekly hours worked, amount and type of deductions, rate of pay, actual wages paid, and date of payment.
These payroll records need to be maintained for three years after the completion of the project by the contractor and subcontractors. These records should also be made available for inspection by the contracting agency, the DLIR and any representatives.
Note that Hawaii requires general engineering, general building and specialty contractors to be licensed.

Underpayment of prevailing wages or failing to pay for overtime can lead to a termination of the contractor or subcontractor’s right to proceed with the work. The contracting agency may complete the work by contract or by other means. In that instance, the government contractor or contractor’s surety is liable to the contracting agency for any additional costs.

The DLIR and the contracting agency conduct investigations and assessments of contractors and subcontractors to ensure compliance. The following are penalties for violations:

• First violation – 10% of back wages due or $25 per offense, whichever is greater
• Second violation (occurs within 2 years of the first notification) – back wages due in full or $100 for every offense, whichever is greater
• Third violation (occurs within 2 years of the second notification) – double the amount of back wages or $200 for every offense, whichever is greater, and suspension for 3 years from doing public work projects

For the first or second violation, the contractor is immediately suspended until the penalties are resolved. For a third violation, the contractor is suspended as mentioned above, until all wages and penalties are paid full.

There are also penalties for contractors who fail to make payroll records accessible, or who fail to provide information upon request within 10 days, or who fail to keep records as stated, or who falsify any required record.

Interference with or delaying of any investigation, which includes failure to provide information upon request within 10 days, failure to allow employees to be interviewed during working hours, and falsification of payroll records, also has consequences. The contracting agency will withhold any further payments until the delay ceases. A penalty of $1000 per project and $100 per day thereafter can also be imposed.