When preparing for a project that falls under Prevailing Wage Requirements, it can sometimes feel like you need a secret decoder ring to decipher an employee’s Wage Determination. Hopefully we can clear up this mystery for you.
Your project’s Wage Determination Period is determined by when the project was first advertised for bidding. Each year is broken into two sections. Period 1 are projects having a Bid Advertisement date between March 3rd (if a leap year), March 4th (non-leap year) to August 31st. Period 2 are projects with Bid Advertisement dates between September 1st and either March 2nd (leap year) or March 3rd (non-leap year). For example, if your project advertised on June 29th, 2019, the project Wage Determination Period would be 2019-1. It’s important to know these dates when preparing to release a bid advertisement to ensure that a project falls into a specific Wage Determination Period.
All prevailing wage rates change over time. If there is a “predetermined” date to change the wage rate the expiration date will have a double asterisk ** following it, which means the determination will change on that day. So even if you are in the middle of a project and the expiration date takes place during your project, you are required to increase your workers’ wages.
What if there’s a single asterisk * next to the expiration date? This means there isn’t a “predetermined” change to the wage. The rate listed for that Wage Determination will stay the same for the entirety of the project, whether the project lasts six months or six years. This means, if you have a project in the Determination period of 2019-1 and that particular Wage Determination, let’s say Operating Engineer, has a single asterisk *, no matter how long your project lasts, that is the Wage Determination you use to pay your Operating Engineers. If on the same project you also have Laborers, a Wage Determination with a double asterisk**, the wages must be increased as dictated by the DIR.
Looking at the same Laborer, working on a 2019-1 Determination period with a double asterisk ** – How do you know what those wage increases are? How do you know when the increase will take place or by how much? The DIR provides all of the predetermined wage increases. It lists the date the increase will take effect and how the increase is to be allocated. On this same example of a laborer for 2019-1, the DIR dictated there was to be an hourly increase on July 1, 2019 of $2.05. The DIR stipulated that the $2.05 was to be allocated as follows: $1.00 to Basic Hourly Rate, $0.15 to Health & Welfare, $0.87 to Pension, and $0.03 to Vacation. The DIR dictates that the next increase for Laborers will take place on July 1, 2020 and again the following year. If this is a multiple-year project, the Laborer’s wage needs to increase accordingly and an updated Fringe Benefit Statement will need to be provided to the Labor Compliance Administrator.
Overall, it is important to remember the Bid Advertisement date determines the Prevailing Wage Determination and a single asterisk* or double asterisk** determines whether or not there is a predetermined wage increase.
Blog Written By: Teresa Osso, Labor Compliance Manager
Comments or questions? Please feel free to contact Teresa at email@example.com.