A prevailing wage job is a position where workers are paid wages and benefits that meet or exceed the prevailing wage rate established by government agencies for specific job classifications in public works projects. These wages are mandated by federal, state, or local laws to ensure that contractors and subcontractors on publicly funded projects compensate workers fairly and competitively.
Prevailing wage laws exist to prevent employers from underpaying workers, and create a level playing field in industries like construction, engineering, and public infrastructure projects, just to name a few. To pay prevailing wages helps maintain wage standards and prevent wage suppression caused by low-bid contracting practices for similarly employed workers .
Federal and California Prevailing Wage Laws
Several key employment laws govern prevailing wage requirements:
- The Davis-Bacon Act (DBA) – (also known as the Prevailing Wage Act) Enacted in 1931, this federal law requires contractors and subcontractors working on federally funded construction projects exceeding $2,000 to pay their employees prevailing wages based on local wage determinations set by the U.S. Department of Labor (DOL).
- The McNamara-O’Hara Service Contract Act (SCA) – This law applies to federal contracts for services and ensures that service workers receive wages and benefits that align with local wage determinations.
- The Walsh-Healey Public Contracts Act (PCA) – This law covers manufacturing and supply contracts with the federal government, requiring fair wage payments.
- California Prevailing Wage Laws – Many states have their own prevailing wage laws, often called “Little Davis-Bacon Acts,” which apply to state or locally funded public works projects. Some states require higher wages than federal standards.
How Prevailing Wage Rates Are Determined
Prevailing wages are set by government agencies, typically based on surveys of wages and benefits paid to workers in a particular locality. The U.S. Department of Labor conducts these surveys and issues wage determinations and applicable prevailing wage rates, which specify the minimum wage per hour, fringe benefits, and overtime rates for different job classifications.
Factors influencing prevailing wage determinations include:
- Geographic Location – Wages vary by state, county, or city based on labor market conditions.
- Job Classification – Different trades, such as electricians, plumbers, carpenters, and laborers, have specific prevailing wage rates.
- Union vs. Non-Union Wages – In many cases, prevailing wage rates align with union wages if a majority of workers in the area are unionized.
Industries That Require Prevailing Wage Jobs
Prevailing wage laws primarily impact workers employed in:
- Construction projects – Roads, bridges, schools, hospitals, and government buildings.
- Public utility work – Water treatment plants, electrical grid maintenance, and telecommunications infrastructure.
- Service contracts – Janitorial, security, and maintenance services under federal or state contracts.
Employer Responsibilities in Prevailing Wage Jobs
Employers working on prevailing wage jobs must comply with:
- Certified Payroll Reporting – Contractors must submit certified payroll records to verify that employees receive the correct wages and benefits.
- Fringe Benefit Payments – Employers must either provide benefits directly or pay fringe benefit amounts as additional wages.
- Overtime Requirements – Prevailing wage jobs often have stricter overtime pay rules, requiring higher pay rates beyond standard working hours.
- Worker Classification Compliance – Misclassifying workers to pay them lower wages can lead to legal penalties and wage theft claims.
Worker Rights and Legal Protections
Employees working on prevailing wage jobs are entitled to:
- Fair and competitive wages based on their job classification.
- Legal recourse for wage violations, including back pay and damages.
- Protection from retaliation if they report wage violations.
Workers who suspect wage violations can get a free consultation at Lawyers for Justice, PC to see if their rights have been violated..
A prevailing wage job ensures workers receive fair compensation on government-funded projects, helping maintain industry wage standards. Employers must comply with federal and state laws to avoid legal penalties, while workers should understand their rights to ensure they are paid correctly. If someone feels their collective bargaining agreements were violated, or they were paid improperly for their work, they should seek legal guidance.
When Is Prevailing Wage Required? – FAQ
what is prevailing wage in california? In California, prevailing wage laws require contractors working on public works projects to pay their workers at least the average wage and benefits paid to similar workers in the same trade and location. These rates are determined by the California Department of Industrial Relations (DIR) and are based on collective bargaining agreements and sometimes labor statistics.
what are prevailing wages? Prevailing wages are the minimum hourly wages, including fringe benefits, that contractors must pay to workers on public works projects.
how much is prevailing wage in california? It can depend on county. Some examples include:
- bricklayers and masons: $47.20 per hour
- forklift operator: $49.98
- industrial painter: $41.42
- SEE ALL RATES HERE
how to find out if a job is prevailing wage? A good place to start is to check if it’s a public works project or federally funded, and then check for prevailing wage schedules or wage determinations in your county.
what is prevailing wage rate? In California, prevailing wages can be found here.
what does prevailing wage mean in construction? In the construction industry, a “prevailing wage” refers to the minimum hourly wage, benefits, and overtime pay required to be paid to workers on public works projects. This is done to ensure fair compensation and prevent contractors from undercutting workers’ wages.
when is prevailing wage required? Prevailing wages are required on projects involving public works, including construction, alterations, or repairs, and certain other types of work defined by state and federal laws.
what is the difference between davis bacon and prevailing wage? The key difference between the Davis-Bacon Act and prevailing wage laws is that the Davis-Bacon Act specifically applies to federally funded construction projects, while prevailing wage laws can be state or local mandates applying to public works projects, regardless of federal funding.
