TIP #4

Three factors determine the prevailing wage:

• The bid advertisement date.
• Whether the money is State, Federal, or from both will choose what pay rate to use.
• The County where the Jobsite’s physical address location.

The Request for Proposal (RFP) will reference the determination number on the Director of Industrial Relations website. The determination number may be from a prior year if construction on the project has already started. The determination number from the bid advertisement date stays the same until the project’s completion. There is one exception if the project is a Design-Build project. The Design-Build project will have multiple determinations based on the bid advertisement date of each bid package. Two decisions are issued each year in February and August. The State determination number referenced, i.e., 2021-1, then visit the DIR website www.dir.ca.gov to find the prevailing wages for your specific trade(s). If Federal and State funds, the Federal determination is included in the contract. If it is not in your agreement, ask for it. When the project has both Federal and State determination, you must check both and pay the higher of the two.

Prevailing wage is base pay plus fringes will equal the prevailing wage. The base pay, health & welfare, vacation, pension, training fund, and other hourly is the rate to be paid. If the job site is over 50 miles from the employee’s home, include travel pay and sustenance to the prevailing wage.

READ THE FOOTNOTES

The prevailing wage determination has letters and symbols; they are not decorations. Read every footnote; they explain essential instructions. Look for the double asterisks (**); this indicates predetermined increases built into the determination. Not accounting for the predetermined increases will cause you to underbid the project.

UNION VS NON-UNION

Non-union contractors pay the base pay plus all the fringes EXCEPT the training fund to the employee. If you pay the training fund to the employee, you will have to pay the training fund twice because there are no takebacks in the prevailing wage. Pay training fund to the California Apprentice Council.

Union contractors pay the base pay to the employee and send the fringes to the Union Trust Fund on behalf of the employee every month. The union trust fund report and money are due by the 15th of each month for the prior months’ hours worked. If the money and union reports are late, liquidation damages start accruing until the money is received

If a Project Labor Agreement (PLA) is attached to the project, all contractors follow the union rules. There will be a separate blog regarding PLA agreements.