Prevailing Wage and Davis-Bacon Compliance in Vermont
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Vermont's Public Works Regulations
Vermont has its own prevailing wage law under the Capital Construction Act (CCA), which applies to state-funded construction projects. Federally funded projects must abide by The Davis-Bacon Act.
- State Law: The CCA requires contractors on qualifying projects to pay workers prevailing wages and benefits based on rates established by the Vermont Department of Labor.
- Federal Law: Federally funded or assisted construction projects over $2,000 typically require compliance with the Davis-Bacon Act's federally determined prevailing wage rates.
Definition of "Public Works" in Vermont
In Vermont, public works generally refer to construction, reconstruction, improvement, repair, or maintenance projects funded wholly or partially by public funds. These include:
State-funded infrastructure projects under the Capital Construction Act
Roads, highways, and bridges
Public schools, libraries, and government buildings
Water and sewage treatment facilities
Parks, recreational areas, and other public infrastructure
Projects funded by federal resources must comply with the Davis-Bacon Act, while state-funded projects follow the CCA guidelines.
Prevailing Wage Determinations
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
Capital Construction Act
- All employees working on construction projects must be paid at least the average prevailing wage.
- The average prevailing wage is determined by the Vermont Department of Labor.
- An additional 42.5% Fringe Benefit component must also be included.
Components of Wage Determinations
Both federal and state wage determinations in Vermont include:
- Basic Hourly Rate: The minimum hourly wage required for a specific job classification, excluding fringe benefits.
- Fringe Benefits: Non-cash benefits include health insurance, pensions, and vacation pay. The value of fringe benefits in Vermont can be found by multiplying the wage rate by .425.
- Total Hourly Rate: The sum of the basic hourly rate and fringe benefits.
Compliance for Contractors and Subcontractors
Contractors and subcontractors working on public works projects in Vermont must:
- 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: Use the Vermont Department of Labor website for CCA rates
- Submit Certified Payroll Reports:
- For federal projects: Use U.S. Department of Labor's Form WH-347
- For state projects: Contractors in Vermont are typically required to submit their payroll records to the Vermont Department of Labor (DOL) or the specific state agency overseeing the project, such as the Department of Buildings and General Services (BGS).
- Handle Fringe Benefits:
- Ensure workers are paid the prevailing wage rate, including fringe benefits.
- Post Wage Rates On-Site:
- Display the prevailing wage determinations at the project site for workers.
- Maintain Accurate Records:
- Keep detailed payroll records, including hours worked, wages paid, and fringe benefits provided, for at least three years after project completion.
Penalties for Non-Compliance
Failure to comply with prevailing wage laws in Vermont can result in:
- Paying back wages
- Fines
- Risk of being barred from future public contracts
Unique Aspects of Vermont's Prevailing Wage System
- Geographic Wage Determinations: Vermont divides the state into three geographic regions for determining prevailing wages: the Burlington-South Burlington Metropolitan New England City and Town Area (NECTA), the Southern Vermont Area, and the Northern Vermont Area.
Integration of a Fixed Fringe Benefit Percentage: Vermont requires employers to add a specific fringe benefit percentage—currently 42.5%—on top of the prevailing hourly wage. This set percentage is relatively high compared to some other states.
Emphasis on Local Determination: While many states rely on federal wage determinations alone, Vermont's prevailing wages are set by the Vermont Department of Labor.
Relevant Resources
- U.S. Department of Labor Wage Determinations Online (WDOL): SAM.gov - Wage Determinations
- Vermont Department of Labor
- U.S. Department of Labor Certified Payroll Form: Form WH-347
For definitive legal guidance, always consult the Vermont Department of Labor, review the most recent Capital Construction Acts and the Vermont Statutes, and, if federal funding is involved, refer to the Davis-Bacon Act and U.S. Department of Labor regulations.
Vermont Prevailing Wage FAQs
Q Does Vermont have its own prevailing wage law?
Yes. Although Vermont does not have a single, standalone statute that's often referred to as the "Vermont Prevailing Wage Law," the state does require the payment of prevailing wages (including a set fringe benefit percentage) on certain publicly funded projects. These requirements are typically embedded in Vermont statutes (such as 29 V.S.A. § 161) and in the Capital Construction Acts passed by the legislature.
Q What is the 42.5% fringe benefit component?
Under Vermont's prevailing wage requirements, employers must add 42.5% of the base wage rate to cover fringe benefits. For instance: Fringe Benefit = Base Wage × 0.425
This ensures that workers receive not only a fair hourly wage but also supplemental benefits (e.g., health insurance, pensions, paid leave).
Q How can I check the current prevailing wage rates?
For Federal (Davis-Bacon) Projects: Check SAM.gov (Wage Determinations) or the U.S. Department of Labor site.
Q What are the penalties for non-compliance with prevailing wage laws in Vermont?
Penalties include back pay for underpaid workers, fines, and disqualification from future state or federally funded projects.