What Is Certified Payroll Reporting?

What Is Certified Payroll Reporting?

If your business is exploring opportunities to work on construction projects funded by the federal government as a contractor or subcontractor, you will be required to submit certified payroll records on a weekly basis. This is an essential step to demonstrate your commitment to fair compensation for your workers.

The Davis-Bacon Act requires employers to pay their workers the prevailing wage rate for a specific geographic area for their specific work class on a federally-funded project. Many States and Municipalities have similar Prevailing Wage Schedules. The certified payroll reports must be submitted weekly to the Government Agency that "owns" the Project using Form WH-347 for all contracts subject to Davis-Bacon labor standard provisions.

It is important to note that employers must file these reports even if work is temporarily halted. Employers have a maximum of seven calendar days from the payment date to comply with the regulations. Certified payroll reports ensure that employees are paid fairly and that contractors and subcontractors comply with federal laws.

What is Certified Payroll and Which Companies Must Use It?

Certified payroll is a unique weekly payroll report, typically completed using Form WH-347, required from contractors on federally-funded projects. This report proves that workers are being paid the prevailing wage in compliance with federal standards.

Certified Payroll is a type of report confirming whether contractors and subcontractors working on government-funded projects pay their employees the prevailing wages, as mandated by the Davis-Bacon and Related Acts. In short, companies that are working on projects that receive public funds must submit certified payroll reports.

Why Are Certified Payroll Reports Required?

Certified Payroll Reports underscore the cornerstone of integrity in federally funded construction contracts. They are ideal tools designed to affirm that contractors uphold the obligation to compensate workers with the rightful prevailing wages and supplemental fringe benefits.

This systemic process shields workers' economic well-being and embodies the principles of fair competition and equitable employment. Non-compliance, submitting erroneous or delinquent reports, exposes employers to potential liabilities and penalties. It is a stringent yet necessary check and balance mechanism that maintains transparency and promotes ethical business standards in the contracting environment.

What is the Davis-Bacon & Related Acts?

The Davis-Bacon and Related Acts (DBRA) are federal laws establishing specific wage and fringe benefit requirements for contractors performing work on federally-funded or federally-assisted construction projects.

The Davis-Bacon Act, passed in 1931, was established to protect local labor and construction workers from the undercutting effects of lower-wage laborers in that region or from other regions. The Act ensures that contractors and subcontractors pay their laborers employed on federal projects no less than the locally prevailing wages and fringe benefits for corresponding work on similar projects in the area.

DBRA Compliance

Contractors and subcontractors must submit weekly certified payroll records to demonstrate compliance with compensation requirements. This involves a transparent report detailing wages and fringe benefits paid to each worker. Non-compliance can result in penalties, withheld contract payments, and potential disbarment from future contracts.

What Do Certified Payroll Reports Include?

To comply with federal regulations, certified payroll reports must include the following details for employees who have worked on federal projects subject to coverage:

  • Full name and identifying number of the worker
  • Work classification
  • Hours worked daily, including the day, date, straight time, and overtime hours.
  • Total hours
  • Rate of pay
  • Fringe benefits, either paid to a bona fide Plan or to the employee in cash
  • Gross amount earned
  • All payroll deductions and a total of the deductions
  • Net wages paid for the week

How does eMars Help With Certified Payroll Reporting?

The Compliant Client is a web-based solution designed to simplify the management of a company's payroll compliance obligations. It is easy to learn and use, with a user-friendly interface and intuitive design. It helps users stay up-to-date with all compliance regulations and ensures that the business remains compliant at all times.

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