California’s Prevailing Wage Law requires contractors to pay specific wage rates on public works projects. The rates are published by the State’s Department of Industrial Relations (“DIR”). The published rates include many different prevailing wage rates, which are based on the geographic location and the type of work that is performed. The rates are organized and published by the DIR in General Prevailing Wage Determinations, which set forth the rates for worker classifications (e.g., Laborer, Carpenter, Plumber, Operator). The specific rates applicable for each craft, classification, or type of work, and for each geographic locality throughout the state, can be located on the DIR website at www.dir.ca.gov Understanding how to read a General Determination is important to understanding the required rate.
California Labor Code (section 1774) states that workers must be paid not less than the “specified prevailing rates of wages” to all workmen employed in the execution of the contract. These specific rates are found in the General Determinations, which correspond to the type of work actually performed by individual workers. As explained in the State’s Public Works Manual,
“A worker’s title or status with the employer is not determinative of an individual’s coverage by the prevailing wage laws. What is determinative is whether the duties performed by the individual on a public works project constitute covered work. An individual who performs skilled or unskilled labor on a public works project is entitled to be paid the applicable prevailing wage rate for the time the work is performed, regardless of whether the individual holds a particular status such as partner, owner, owner-operator, independent contractor or sole proprietor, or holds a particular title with the employer such as president, vice-president, superintendent or foreman. For example, a “working” foreman or a “working” superintendent – one who performs labor on the project in connection with supervisorial responsibilities – is entitled to compensation at not less than the prevailing rate for the type of work performed.”
General Determinations include both a Basic Hourly Rate and the Total Hourly Rate for each location and classification. Employers are required by California law to pay employees the Basic Hourly Rate as the minimum hourly wage for all hours worked. The Total Hourly Rate includes the Basic Hourly Rate and additional compensation for “employer payments” which are typically fringe benefits such as health insurance, vacation, pension and other “fringe benefits.” Employers can choose to pay fringe benefits directly to employees as part of their wages or can obtain an offset for the employer’s “actual cost” of the benefit provided to the employee that was paid into a bona fide health, pension, vacation, or fringe benefit plan. Either way, the total compensation paid by the employer to the employee must match the Total Hourly Wage set by the Director in the General Determination.
The Total Hourly Rate for a Laborer classification for Group 1 in Los Angeles County as determined by the Director in February of 2017 is $52.08 per hour straight time, $68.25 per hour overtime, and $84.42 per hour Sunday, Holidays and double time.
Here is the actual Director’s determination for a Laborer Group 1 as of February 22, 2017 (Source: Determination SC-23-102-2-2017-1 issued February 22, 2017 for all localities within Imperial, Inyo, Kern, Los Angeles, Mono, Orange, Riverside, San Bernardino, San Luis Obispo, Santa Barbara, and Ventura counties.)
In this example, the Total Hourly Rate is composed of $32.34 in Basic Hourly Rate pay and $19.74 in fringe benefit allowances. Employers in this example must pay at least $32.34 per hour in wages for straight time. In addition, they must pay $19.74 into approved health, pension, vacation and training plans or pay it directly in wages. Either way, the total hourly wage paid by the employer must be $52.08 per hour for straight time.
If the employer is only paying the Basic Hourly Rate of $32.34 as the wages and no other benefits or compensation then the worker is being underpaid.
The General Prevailing Wage Determinations made by the Director of Industrial Relations are determined by certain geographic locations and specific work classifications.
Locations for the Director’s determinations can be Statewide classifications, a Northern or Southern California classification or by a specific County such as Los Angeles, San Diego, Riverside, San Bernardino, Orange County, Alameda, Sacramento, etc. You can review the different area location classifications and rates that are applicable for your public works project at https://www.dir.ca.gov/oprl/2017-1/PWD/index.htm.
Examples of worker classifications include boilermaker, blacksmith, iron worker, electrical utility lineman, telecommunications technician, telephone installation worker, tree trimmer, stator rewinder, electrical utility lineman, metal roofing, driver for on/off-hauling or to/from a construction site, asbestos workers, heat and frost insulators, inspector, carpenters, cement masons, operating engineers, drywall installer, laborer, landscape maintenance laborer, pile drivers, slurry seal workers, teamsters, tree trimmer, electrician, field surveyor, bricklayer, plasterer, plumber, roofer, sheet metal worker, water well driller and tile setter.
If by chance your type of work is not listed in any of the determinations by the Director of the DIR, the law establishes that the proper rate is the rate of the work that “most closely resembles” the type of work performed.
Workers who are being underpaid or not paid the proper prevailing wage rate have options. They can research online the proper rate, they can file a complaint with the DIR or they can contact a prevailing wage attorney at Donahoo & Associates, PC for a free, confidential consultation. If you contact an attorney be sure to inquire if the attorney has experience in California’s Prevailing Wage Law.
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