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Prevailing Wage and Davis-Bacon Compliance in Illinois

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Illinois's Public Works Regulations

Illinois has both state and federal regulations governing prevailing wages for public works projects:

State Law: The Illinois Prevailing Wage Act (820 ILCS 130) applies to public works projects funded by the state or local governments.
Federal Law: For federally funded or federally assisted projects, contractors must comply with the federal Davis-Bacon Act, which sets wage standards based on federal determinations.

Definition of "Public Works" in Illinois

In Illinois, public works refers to the construction, maintenance, or repair of state-owned or funded facilities, including infrastructure projects like:

Roads and highways
Public schools
Government buildings
Bridges and utilities

Key Points:

Any construction project that is financed fully or partially by public funds is considered a public works project.
Both the Illinois Prevailing Wage Act and the Davis-Bacon Act may apply depending on the funding source.

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Illinois Prevailing Wage Determinations: State and Federal Requirements

Illinois Prevailing Wage Act

The Illinois Department of Labor (IDOL) determines the prevailing wage rates for state-funded public works projects.
These rates are updated annually on a county-by-county basis and reflect the wages typically paid to workers in similar job classifications in the local area.
Illinois prevailing wage determinations may sometimes align with federal rates but are set independently by the state.

Federal Davis-Bacon Act (DBA)

Under the Davis-Bacon Act, the U.S. Department of Labor sets prevailing wages for federally funded projects.
These rates are based on local wage surveys and cover both basic hourly wages and fringe benefits for various job classifications.

Components of Wage Determinations

Both state and federal wage determinations in Illinois include:

Basic Hourly Rate: The minimum wage rate paid directly to workers for every hour worked.
Fringe Benefits: Non-cash benefits include health insurance, retirement plans, and vacation pay.
Total Hourly Rate: The sum of the basic hourly rate and fringe benefits.

For example, if the basic hourly wage is $30 and fringe benefits are $10, the total hourly rate is $40. If fringe benefits are not provided, the full $40 must be paid in cash.

Compliance for Contractors and Subcontractors

Contractors and subcontractors working on public works projects in Illinois must:

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Determine Applicable Wage Rates

For federal projects: Use the U.S. Department of Labor's Wage Determinations Online (WDOL) portal via SAM.gov.

For state projects: Refer to the Illinois Department of Labor.

Submit Certified Payroll Reports

For federal projects: Use the U.S. Department of Labor's Form WH-347. For state projects: Submit to the Illinois Department of Labor.

For state projects: Submit to the Illinois Department of Labor.

Handle Fringe Benefits

Ensure workers are paid no less than the applicable prevailing wage for their job classification, including both the basic hourly rate and fringe benefits.

Post Wage Rates On-Site

Contractors must post the prevailing wage determinations in a prominent place on the job site where workers can see them.

Maintain Accurate Records

Contractors must maintain detailed records of hours worked, wages paid, and any fringe benefits provided. These records should be available for inspection by the Illinois Department of Labor or the U.S. Department of Labor.

Penalties for Non-Compliance

Failure to comply with prevailing wage laws in Illinois can result in:

Fines
Back pay for underpaid workers
Disqualification from future public works contracts

Unique Aspects of Connecticut's Prevailing Wage System

Annual Wage Determinations: Illinois sets its prevailing wage rates annually through surveys and reports from contractors, unions, and public bodies.
County-Specific Rates: Prevailing wages in Illinois are determined at the county level, meaning rates can vary significantly across the state.
Comprehensive Coverage of Fringe Benefits: In Illinois, prevailing wages include not only base hourly rates but also fringe benefits such as health insurance, retirement plans, and vacation time. Contractors are required to meet these standards, either by directly providing the benefits or paying the equivalent amount in wages.

Relevant Resources

U.S. Department of Labor: Wage Determinations Online (WDOL): SAM.gov - Wage Determinations
Illinois Department of Labor: Prevailing Wage Rates: Illinois Prevailing Wage Rates
Certified Payroll Form WH-347: U.S. Department of Labor Certified Payroll Form

Does Illinois have a state-specific prevailing wage law?

Yes, Illinois has its own prevailing wage law, known as the Illinois Prevailing Wage Act. This law applies to state or locally funded public works projects and requires contractors to pay workers at least the prevailing wage set by the Illinois Department of Labor. For federally funded projects, the Davis-Bacon Act applies.

How are prevailing wage rates determined in Illinois?

For federally funded projects, prevailing wage rates are determined by the U.S. Department of Labor based on local wage surveys. For state-funded projects, the Illinois Department of Labor (IDOL) sets the prevailing wage rates through county-level surveys of wages paid to workers in similar job classifications.

What are the penalties for non-compliance with prevailing wage laws in Illinois?

Failing to pay the correct prevailing wage can result in financial penalties, known as fines. Contractors may also be required to provide back pay to workers for any underpayment. Consistent violations of wage laws could lead to debarment, disqualifying contractors from bidding on future public works projects.

How are fringe benefits handled under prevailing wage laws in Illinois?

Fringe benefits are part of the total prevailing wage. Contractors can either provide fringe benefits such as health insurance or pension contributions, or they can pay the equivalent value in cash to the workers. If fringe benefits are not provided, the contractor must pay the full total wage in cash (basic hourly rate + fringe benefits).