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Prevailing Wage and Davis-Bacon Compliance in South Dakota

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South Dakota's Public Works Regulations

Unlike some states, South Dakota does not have a state-specific prevailing wage law. However, public works projects in South Dakota are subject to federal regulations when federal funding is involved:

Federal Law: The Davis-Bacon and Related Acts (DBRA) apply to federally funded or assisted construction projects in South Dakota.
State Law: South Dakota lacks a "Little Davis-Bacon Act" or any state-specific prevailing wage laws.

The Davis-Bacon Act applies to public works projects that receive federal funding when the total contract value exceeds $2,000. Contractors and subcontractors on such projects must ensure that workers are paid at least the locally prevailing wage rates for their job classifications.

Definition of "Public Works" in South Dakota

In South Dakota, public works refer to construction, reconstruction, improvement, repair, or maintenance projects funded wholly or partially by public funds. These projects may include:

Roads, highways, and bridges
Public schools, government buildings, and other infrastructure
Water and sewage treatment plants
Parks and other public facilities

Public works projects that receive federal funding are subject to prevailing wage requirements under the Davis-Bacon Act.

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Prevailing Wage Determinations: Federal (Davis-Bacon) Requirements

Since South Dakota does not have state-specific prevailing wage laws, the U.S. Department of Labor establishes prevailing wages for federally funded projects under the Davis-Bacon Act. Key points include:

Rates are based on local wage surveys for specific job classifications, inclusive of basic hourly and fringe benefits.
Different rates apply based on worker classifications (e.g., laborers, carpenters, electricians).
Contractors must consult the federal General Wage Determinations published by the U.S. Department of Labor.
The wage determinations specify the basic hourly wages and fringe benefits for each worker classification, ensuring fair compensation for workers on public works projects.

Components of Wage Determinations

Federal wage determinations for South Dakota include:

Basic Hourly Rate: The minimum hourly wage that contractors must pay workers for their job classifications.
Fringe Benefits: Non-cash benefits such as health insurance, retirement plans, and vacation or holiday pay.
Total Hourly Rate: The sum of the basic hourly rate and fringe benefits. For example, if the basic hourly rate is $20 and fringe benefits are $5, the total hourly rate would be $25. If the contractor does not provide fringe benefits, the worker must receive $25 as wages.

Compliance for Contractors and Subcontractors

Contractors and subcontractors working on federally funded public works projects in South Dakota must adhere to the following:

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Determine Applicable Wage Rates

Identify the correct prevailing wage rates for each job classification and project location. Wage determinations are available through the Wage Determinations Online (WDOL) portal on SAM.gov.

Submit Certified Payroll Reports

Use the U.S. Department of Labor's WH-347 form or an equivalent to ensure appropriate wages and fringe benefits are paid to workers.

Handle Fringe Benefits

Ensure workers receive the correct prevailing wage for their job classification, which includes the basic hourly wage and any applicable fringe benefits.

Post Wage Rates On-Site

Display the applicable wage rates at the worksite for transparency and worker awareness.

Maintain Accurate Payroll Records

Keep records of all wages paid to employees for inspection in case of audits or investigations.

Penalties for Non-Compliance

While South Dakota does not have state-specific penalties, federal law imposes strict consequences for violations of the Davis-Bacon Act, including:

Fines
Back pay for underpaid workers
Disqualification from future federally funded projects

Unique Aspects of South Dakota's Public Works System

Minimal State Oversight on Prevailing Wages: The lack of additional state-specific prevailing wage laws means South Dakota operates under a streamlined environment governed only by federal Davis-Bacon Act guidelines.
No State Prevailing Wage Law: Unlike many states, South Dakota relies solely on federal regulations for prevailing wages on public works projects.
Significant Role of Tribal Lands in Public Works: South Dakota's extensive tribal lands mean that public works projects often intersect with Native American communities. These projects require collaboration with tribal governments and adherence to additional federal policies related to Native employment rights and benefits, in addition to compliance with the Davis-Bacon Act.

Relevant Resources

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

For the most current and detailed information, always refer to the U.S. Department of Labor website and consult with legal counsel familiar with federal labor laws and their application in South Dakota.

Does South Dakota have its own prevailing wage law?

No, South Dakota does not have a state-specific prevailing wage law. However, federally funded public works projects in South Dakota are subject to the federal Davis-Bacon Act, which requires contractors to pay workers prevailing wages as determined by the U.S. Department of Labor.

How are prevailing wage rates determined for public works projects in South Dakota?

Prevailing wage rates for federally funded projects are determined by the U.S. Department of Labor through local wage surveys. These wage rates include both a basic hourly wage and fringe benefits, and they are published on the Wage Determinations Online (WDOL) portal via SAM.gov.

What are the penalties for non-compliance with prevailing wage requirements in South Dakota?

Penalties for non-compliance with Davis-Bacon prevailing wage laws include fines, back pay for underpaid workers, and potential disqualification from future federally funded contracts. Repeat offenders can also face debarment from government contracts.

How are fringe benefits handled under the Davis-Bacon Act in South Dakota?

Contractors can either provide fringe benefits, such as health insurance and retirement plans, or they can pay the equivalent value in cash. If no fringe benefits are provided, the contractor must pay the total hourly rate (basic wage + fringe benefits) in cash to the worker.