Prevailing Wage and Davis-Bacon Compliance in Ohio

Ohio's Public Works Regulations

Ohio has a dual system of prevailing wage laws:

• State Law: The Ohio Revised Code (ORC) Chapter 4115, known as the Ohio Prevailing Wage Law, requires that contractors and subcontractors working on public works projects funded by state or local government pay their workers no less than the prevailing wage rates determined by the Ohio Department of Commerce, Division of Industrial Compliance.
• Federal Law: For federally funded or federally assisted public works projects, contractors must also comply with the federal Davis-Bacon Act, which sets prevailing wage rates as determined by the U.S. Department of Labor.

Key point:

• The Ohio Prevailing Wage Law laws apply to:
  • New construction: $250,000 or more for state or local projects.
  • Reconstruction, enlargement, alteration, repair: $75,000 or more.

Definition of "Public Works" in Ohio

In Ohio, public works refers to construction, reconstruction, improvement, enlargement, alteration, or repair projects funded wholly or partly by public funds. This includes:

• Roads, highways, and bridges

• Public schools, libraries, and government buildings

• Water treatment plants and other public infrastructure

Projects that meet these criteria and exceed the specified cost thresholds are subject to Ohio's prevailing wage law. Federally funded public works projects must adhere to the Davis-Bacon Act's wage requirements.

Prevailing Wage Determinations: Federal and State Requirements

Federal Davis-Bacon Act

• Requires contractors on federally funded or assisted public works projects to pay workers the locally prevailing wages for similar projects, as determined by the U.S. Department of Labor
• These prevailing wages are determined based on local wage surveys and include basic hourly and fringe benefits.

Ohio's Prevailing Wage Law

• The Ohio Department of Commerce sets prevailing wage rates for state-funded public works projects.
• These rates are based on local wage data and collective bargaining agreements.

• The prevailing wage rate for each job classification must be paid for all hours worked on qualifying public projects.

Components of Wage Determinations

Both federal and state wage determinations in Ohio include:

• Basic Hourly Rate: The minimum hourly wage that workers must be paid for their specific job classification, excluding fringe benefits. The basic hourly rate is determined by wage surveys conducted by the U.S. Department of Labor for federally funded projects and by the Ohio Department of Commerce for state-funded projects.
• Fringe Benefits: Non-cash benefits include health insurance, pensions, and vacation pay.
• Total Hourly Rate: This includes the basic hourly wage and fringe benefits. Contractors can either provide these fringe benefits directly to workers or pay the equivalent value in cash. If fringe benefits are not provided, the full total hourly rate (basic wage + fringe benefits) must be paid to workers in cash.

Compliance for Contractors and Subcontractors

To comply with prevailing wage laws in Ohio, contractors and subcontractors must follow these steps:

1. Determine the Wage Rates:
   • Contractors must determine the applicable prevailing wage rates for the specific job classifications and the project's location.
   • For federal projects: Wage rates are available on the Wage Determinations Online (WDOL) portal via SAM.gov
   • For state projects: Wage determinations are made by the Ohio Department of Commerce.
2. Submit Certified Payroll Reports:
   • Contractors working on public works projects must submit weekly certified payroll reports to the contracting agency.
   • For federal projects: Certified payrolls are submitted using Form WH-347 from the U.S. Department of Labor.
   • For state projects: Contractors must submit payroll reports to the Ohio Department of Commerce.
3. Pay Correct Wages:
   • Contractors must ensure that all workers are paid the correct prevailing wage, including the basic hourly wage and any applicable fringe benefits.
4. Post Wage Rates On-Site:
   • Display the prevailing wage determinations in a visible place on the job site
5. Maintain Accurate Records:
   • Contractors must keep accurate payroll records for at least three years after the project's completion. These records must include hours worked, wages paid, and fringe benefits provided.

Penalties for Non-Compliance

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

• Back pay for underpaid workers
• Fines
• Disqualification from bidding on future public works projects
• Debarment from future government contracts

Unique Aspects of Ohio's Prevailing Wage System

• State-Specific Prevailing Wage Law: Ohio enforces a statewide prevailing wage law, which covers most public construction projects and ensures fair pay for workers.
• Threshold-Based Application: The law applies only to projects exceeding specific cost thresholds, which vary by type (e.g., new construction vs. renovation).
• State-Specific Wage Surveys: Ohio conducts its own wage surveys to determine prevailing rates, ensuring they reflect the state's unique economic conditions and labor market trends.

Relevant Resources

• U.S. Department of Labor: Wage Determinations Online (WDOL): SAM.gov - Wage Determinations
• Ohio Department of Commerce: Prevailing Wage: Ohio Prevailing Wage Information
• Certified Payroll Form WH-347: U.S. Department of Labor Certified Payroll Form