Prevailing Wage and Davis-Bacon Compliance in New Mexico

New Mexico's Public Works Regulations

New Mexico has a dual system of prevailing wage laws:

• State Law: New Mexico has its own prevailing wage law, called the Public Works Minimum Wage Act (NMSA 1978, §§ 13-4-10 to 13-4-17), which applies to public works projects funded by state or local government agencies. Under this law, contractors and subcontractors must pay laborers and mechanics the prevailing wage rates determined by the New Mexico Department of Workforce Solutions (NMDWS) for construction projects exceeding $60,000.
• Federal Law: For federally funded or federally assisted public works projects, contractors in New Mexico must comply with the federal Davis-Bacon Act, which mandates that workers are paid prevailing wages set by the U.S. Department of Labor

Definition of "Public Works" in New Mexico

In New Mexico, public works refers to construction, reconstruction, improvement, repair, or maintenance projects that are funded wholly or partially by state or local government funds. These can include:

• Roads, highways, and bridges

• Public schools and government buildings

• Water and sewer systems

The Public Works Minimum Wage Act applies to all state and locally funded public works projects over $60,000, while the Davis-Bacon Act applies to federally funded projects.

Prevailing Wage Determinations: Federal and State Requirements

Federal Davis-Bacon Act

• This applies to federally funded or assisted projects
• U.S. Department of Labor sets wage rates
• Includes basic hourly wage and fringe benefits

New Mexico Public Works Minimum Wage Act

• For state-funded public works projects, the New Mexico Department of Workforce Solutions (NMDWS) sets the prevailing wage rates for various job classifications based on wage surveys and collective bargaining agreements.

• These rates are updated regularly, and all contractors and subcontractors must comply with these wage rates when performing work on state-funded projects.

Components of Wage Determinations

Both federal and state wage determinations in New Mexico include:

• Basic Hourly Rate: The minimum amount that workers must be paid for their specific job classification, excluding fringe benefits. For both federally funded projects (under the Davis-Bacon Act) and state-funded projects (under the New Mexico Public Works Minimum Wage Act), the basic hourly wage is determined by wage surveys conducted by the U.S. Department of Labor or the New Mexico Department of Workforce Solutions, respectively.
• Fringe Benefits: Non-cash benefits include health insurance, pensions, and vacation pay.
• Total Hourly Rate: The sum of the basic hourly rate and fringe benefits.

For example, if the basic hourly wage is $25 and fringe benefits are valued at $5, the total hourly rate would be $30. The contractor must pay the full $30 as wages if no fringe benefits are provided.

Compliance for Contractors and Subcontractors

Contractors and subcontractors working on public works projects in New Mexico must:

1. Determine Applicable Wage Rates:
   • For federal projects, Wage rates can be found on SAM.gov's Wage Determinations Online (WDOL) portal.
   • For state projects: Wage rates are published by the New Mexico Department of Workforce Solutions (NMDWS).
2. Submit Certified Payroll Reports:
   • For federal projects: Use U.S. Department of Labor's Form WH-347
   • For state projects: Payroll reports must be submitted to the New Mexico Department of Workforce Solutions.
3. Handle Fringe Benefits:

   • Contractors must ensure that workers are paid at least the prevailing wage rate for their specific job classification, including the basic hourly rate and any applicable fringe benefits.

4. Post Wage Determinations On-Site:
   • Display the prevailing wage determinations in a visible place on the job site
5. Maintain Accurate Records:
   • Contractors must maintain detailed payroll records, including hours worked, wages paid, and fringe benefits provided. These records should be available for inspection by the New Mexico Department of Workforce Solutions or the U.S. Department of Labor.

Penalties for Non-Compliance

Failure to comply with prevailing wage laws in New Mexico can result in:

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

Unique Aspects of New Mexico's Prevailing Wage System

• Job Classification Specificity: New Mexico's prevailing wage system includes detailed job classifications for labor and mechanics, ensuring that workers in different trades and skill levels are paid wages that reflect their specialized roles on public works projects.
• Regional Wage Determinations: The system accounts for regional wage variations, meaning prevailing wages may differ across counties or municipalities based on local economic conditions and labor market trends.
• Union and Non-Union Wage Comparisons: New Mexico's prevailing wage rates are often influenced by collective bargaining agreements, but the state also considers data from non-union employers to establish a balanced and representative wage standard.

Relevant Resources

• U.S. Department of Labor Wage Determinations Online (WDOL): SAM.gov - Wage Determinations
• New Mexico Department of Workforce Solutions
• U.S. Department of Labor Certified Payroll Form: Form WH-347