Davis-Bacon Prevailing Wage: A Step-by-Step Compliance Checklist for GCs

What Davis-Bacon Actually Requires

The Davis-Bacon Act requires contractors and subcontractors on federally funded construction projects to pay workers no less than the locally prevailing wages and fringe benefits for corresponding work on similar projects in the area. The U.S. Department of Labor (DOL) sets these rates by trade and locality. They are published in wage determinations attached to each federal contract.

Davis-Bacon applies to federal contracts exceeding $2,000 for construction, alteration, or repair of public buildings or public works. Dozens of related "Davis-Bacon Related Acts" extend the same requirements to federally assisted projects, including those funded through HUD, FHWA, and the Army Corps of Engineers. If your contract has federal money in it, assume Davis-Bacon applies until you confirm otherwise.

Non-compliance carries real consequences: back wages owed to every affected worker, potential debarment from future federal work for up to three years, and contract termination. This is not a paperwork formality.

The Step-by-Step Compliance Checklist

Step 1: Locate and Read the Wage Determination Before You Bid

Every federal solicitation includes a wage determination (WD) issued by the DOL. The WD lists required wage rates and fringe benefits by job classification, for example Carpenter, Ironworker, Electrician, or Laborer, in your project's county or region. Find the applicable WD in the contract documents before you build your labor estimate. Bidding without it produces a number you cannot honor.

Wage determinations are available at SAM.gov and the DOL's beta.SAM.gov portal. Confirm the WD number and revision date match what appears in your executed contract. If the project runs long enough to trigger a new determination, the contracting officer will issue a modification.

Step 2: Post the Required Notices on the Jobsite

Federal regulations under 29 CFR Part 5 require you to post the applicable wage determination and the DOL's "Employee Rights Under the Davis-Bacon Act" poster (WH-1321) at the jobsite in a prominent place where workers can read them. Post them before work begins. Failure to post is a standalone violation, separate from any wage payment issue.

Step 3: Classify Every Worker Correctly

Misclassification is the most common Davis-Bacon violation. Each worker must be paid at the rate for the classification that matches the work they actually perform. A worker who spends the day forming concrete is a Cement Mason or Laborer, depending on the task. Paying them at a Laborer rate when the work is classified as Cement Mason shortchanges their pay and violates the act.

If a worker performs duties in two classifications on the same day, pay the applicable rate for each type of work performed, and document the split in your payroll records. If no classification in the WD covers a type of work on your project, you must request a conformance (an additional classification) from the contracting agency before that work begins.

Step 4: Pay Fringe Benefits Correctly

The prevailing wage has two components: the base hourly rate and fringe benefits. Fringes cover health insurance, retirement contributions, vacation, and similar benefits. You can satisfy the fringe requirement in one of two ways: pay contributions to a bona fide benefit plan (health plan, pension plan, etc.) on behalf of the worker, or pay the fringe amount in cash added to the worker's hourly rate. Many smaller GCs pay cash fringes. Either method works, but the total must meet the WD's stated rate for that classification.

Step 5: Submit Weekly Certified Payroll Reports on Form WH-347

For every week in which any work is performed on a covered project, you must submit a certified payroll report using the DOL's WH-347 form (or an equivalent format containing all required data). The WH-347 shows each worker's name, address, last four digits of their Social Security number, job classification, hours worked by day, gross wages, deductions, and net pay. A signed Statement of Compliance accompanies every submission.

Certified payrolls are due no later than seven days after the regular payday for the pay period covered. Submit them to the contracting agency or the prime contractor, depending on your tier. Subcontractors submit to the prime; the prime compiles and submits to the contracting officer. Keep copies for three years after project completion.

Step 6: Flow Down Requirements to Every Subcontractor

As the prime contractor, you are responsible for your subcontractors' compliance, not just your own. Your subcontracts must include Davis-Bacon clauses, reference the correct wage determination, and require weekly certified payroll submissions. Collect WH-347 reports from every sub and lower-tier sub before you approve their pay applications. Paying a sub who has not submitted certified payroll exposes you to joint liability for any wage violations they commit.

Step 7: Conduct Internal Spot Checks Throughout the Project

Do not wait for a DOL audit to discover a problem. At least monthly, pull a sample of workers from each subcontractor's payroll and verify that the classification and rate match the WD. Cross-reference certified payroll hours against daily reports, foreman logs, or access records. A discrepancy found internally is correctable. One found by a DOL investigator is a violation.

Step 8: Respond Promptly to DOL Investigations and Back-Wage Findings

If the DOL opens a wage compliance investigation, cooperate fully and respond to document requests on time. If back wages are owed, the DOL will issue a finding and require restitution. Pay it. Delaying payment or disputing findings without cause accelerates the process toward debarment. If you disagree with a classification decision or wage finding, work through your contracting officer and request a formal hearing through proper DOL channels.

Common Mistakes That Get GCs in Trouble

• Using the wrong wage determination. Always confirm the WD number in your executed contract matches the one you bid from.
• Forgetting apprentices require DOL-registered apprenticeship programs. Apprentice rates only apply when the worker is enrolled in a DOL-approved program. Otherwise, journeyman rates apply.
• Treating owner-operators as exempt. Bona fide owners who perform construction work are generally still covered unless they meet a specific exemption test.
• Missing the seven-day submission deadline. Late certified payrolls are a violation even if the wages were paid correctly and on time.
• Failing to track fringe credit properly. If your benefit plan does not meet bona fide plan requirements, you cannot use it to satisfy the fringe obligation.

Keep Your Records Organized from Day One

Davis-Bacon recordkeeping requirements run three years past project completion. That means a two-year project leaves you holding five years of records. Organize certified payrolls, fringe benefit documentation, apprenticeship certificates, and wage determination copies by project from the start. Scrambling to reconstruct records during a DOL audit is a preventable problem.

Compliance tracking is easier when certified payroll, lien waivers, and insurance documents all live in one place. EZBilling is built for exactly that.