DIR Prevailing Wage Manual

The DIR Prevailing Wage Manual provides comprehensive guidelines for compliance with prevailing wage laws administered by the Department of Industrial Relations. This manual covers wage determination procedures, contractor obligations, worker classifications, certified payroll requirements, enforcement mechanisms, and compliance monitoring for public works projects. Below are key sections covering legal requirements, wage determinations, compliance procedures, reporting obligations, and enforcement actions.

1. Overview of Prevailing Wage Laws 2. Wage Determination Process 3. Contractor Responsibilities 4. Worker Classification Guidelines 5. Certified Payroll Requirements 6. Compliance Monitoring 7. Enforcement Procedures 8. Recordkeeping Requirements 9. Appeals Process 10. Penalties and Sanctions 11. Frequently Asked Questions

Overview of Prevailing Wage Laws

Prevailing wage laws require payment of locally prevailing wages and fringe benefits to workers on public works projects. Key statutes include Labor Code sections 1770-1782 covering public works contracting.

Law/Regulation	Description
Labor Code §1771	Requires payment of prevailing wages on public works
Labor Code §1773	Director to determine prevailing wage rates
Labor Code §1774	Contractor obligation to pay prevailing wage
Labor Code §1776	Certified payroll record requirements
8 CCR §16000-16403	DIR prevailing wage regulations
Labor Code §1720	Definition of public works
Labor Code §1777.5	Apprenticeship requirements
Labor Code §1810-1815	Enforcement provisions
Labor Code §1741	Penalties for violations
Labor Code §1771.5	Coverage of off-site work

Wage Determination Process

DIR conducts annual surveys and issues prevailing wage determinations for each craft, classification, and type of worker.

Survey Process: Annual collection of wage data from construction projects.
Rate Determination: Analysis of survey data to establish prevailing rates.
Publication: Issuance of general prevailing wage determinations.
Updates: Periodic adjustments and special determinations as needed.

IMPORTANT! Contractors must use current wage determinations for all public works projects.

Contractor Responsibilities

All contractors and subcontractors on public works projects must comply with prevailing wage requirements.

Pay prevailing wages: Pay not less than determined rates for all hours worked.
Post wage determinations: Display applicable wage rates at job site.
Submit certified payroll: Provide certified payroll records weekly.
Maintain records: Keep payroll records for three years.

WARNING! Failure to comply may result in penalties, debarment, and contract termination.

Worker Classification Guidelines

Journeyworker: Fully qualified craft worker paid full prevailing wage rate.
Apprentice: Registered apprentice paid percentage of journey rate.
Laborer: Worker performing manual labor requiring minimal skills.
Mechanic: Skilled worker operating or maintaining equipment.
Craft Worker: Worker in specific trade classification.
Foreman: Supervisor of craft workers.
Trainee: Worker in approved training program.
Specialist: Worker with specialized skills.

Certified Payroll Requirements

Contractors must submit certified payroll records weekly using DIR approved forms.

Required Information: Employee name, address, classification, hours worked, wage rates, deductions, fringe benefits, and contractor certification.

Submission: Certified payroll records must be submitted to the awarding body weekly. Retention: Maintain records for three years from completion of project. Electronic Submission: DIR-approved electronic systems may be used.

Compliance Monitoring

DIR conducts regular compliance monitoring through field inspections and record reviews.

Pre-job conferences: Review requirements before project commencement.
Site visits: On-site inspections of working conditions and wage payments.
Record audits: Examination of payroll records and documentation.
Worker interviews: Confidential interviews with project workers.

Note: Contractors must cooperate fully with DIR compliance officers.

Enforcement Procedures

DIR may initiate enforcement actions for prevailing wage violations.

Notice of Violation: Formal notice of alleged violations.
Hearing: Administrative hearing on violations.
Penalty Assessment: Monetary penalties for violations.
Debarment: Exclusion from public works for serious violations.
Civil Action: Court action to recover unpaid wages.

WARNING! Willful violations may result in criminal prosecution.

Recordkeeping Requirements

Contractors must maintain comprehensive records for three years.

Record Type	Retention Period	Required Information
Payroll Records	3 years	Hours, wages, classifications, deductions
Employment Records	3 years	Hiring, termination, classification changes
Contract Documents	3 years	Bids, contracts, change orders
Fringe Benefit Records	3 years	Contributions, payments, plans
Certified Payroll	3 years	Submitted certified payroll reports

Appeals Process

Contractors may appeal wage determinations and enforcement actions.

Wage Determination Appeals: File within 30 days of issuance. Enforcement Appeals: Request hearing within 15 days of notice. Administrative Review: DIR review of appeals. Judicial Review: Superior court review of final decisions.

Penalties and Sanctions

Violations of prevailing wage laws may result in significant penalties.

Violation	Penalty	Additional Consequences
Failure to pay prevailing wage	Back wages plus penalties	Debarment up to 3 years
False payroll records	$100 per day per worker	Criminal prosecution
Failure to submit records	$100 per day	Contract termination
Worker misclassification	Back wages plus 20% penalty	Liquidated damages
Retaliation against workers	Reinstatement + back pay	Additional penalties

Frequently Asked Questions

Question	Answer
What projects require prevailing wages?	All public works projects over $1,000
How often must payroll be submitted?	Weekly certified payroll reports
What is the penalty for violations?	Back wages, penalties, possible debarment
Can apprentices be used on public works?	Yes, if registered in approved program
How long must records be kept?	Three years from project completion
What is the appeals process?	Administrative appeal to DIR
Are fringe benefits required?	Yes, as specified in wage determination
What constitutes a public work?	Construction paid for with public funds
Can contractors be debarred?	Yes, for willful or serious violations
How are wage rates determined?	Annual survey of construction wages

Contact: Department of Industrial Relations - Division of Labor Standards Enforcement

Website: www.dir.ca.gov/dlse