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Public Works (Prevailing Wage) FAQs
The following are frequently asked questions regarding prevailing wage for public works projects.
The Act affects prime contractors and subcontractors who perform work on any state or political subdivision construction contracts which exceed the current contract threshold amount. This law protects construction workers, such as carpenters, plumbers, power equipment operators, laborers, etc. Covered workers must receive the appropriate craft prevailing wage rate as determined by the Commissioner of Labor and Workforce Development.
The Davis-Bacon Act (DBA) pertains to public construction projects awarded by a federal agency, such as work on military bases and U.S. Postal Service buildings. Certified payrolls must be filed with the proper federal agency. The New Jersey Wage and Hour office does not monitor projects which are covered exclusively by the DBA.
The New Jersey Prevailing Wage Act applies to public works contracts awarded by the state, a political subdivision of the state, or a regional school board. Examples of projects covered by the New Jersey Prevailing Wage Act include schools, roads, water and sewer systems, airports, dams, and public buildings.
Some projects such as airports and highways may be subject to both the DBA and the New Jersey Prevailing Wage Act.
N.J.S.A. 34:11-56.26(5) defines public work as "construction, reconstruction, demolition, alteration, custom fabrication, or repair work, or maintenance work, including painting and decorating, done under contract and paid for in whole or in part out of the funds of a public body."
"Public Work" shall also mean construction, reconstruction, demolition, alteration, custom fabrication, or repair work done on any property or premises, whether or not the work is paid for from public funds, if, at the time of the entering into of the contract the property or premises is owned by the public body.
N.J.S.A. 34:11-56.26(4) defines a public body as "the State of New Jersey, any of its political subdivisions, any authority created by the Legislature of the State of New Jersey and any instrumentality or agency of the State of New Jersey or of any of its political subdivisions."
There are several scenarios in which work can be subject to prevailing wage:
- When there is an agreement or contract between a public body and a contractor to perform "public work", which is defined as construction, reconstruction, demolition, alteration, custom fabrication, or repair work, or maintenance work, including painting and decorating, done under contract and paid for in whole or in part out of the funds of a public body, except work performed under the rehabilitation program. "Public work" shall also mean construction, reconstruction, demolition, alteration, custom fabrication, or repair work, done on any property or premises, whether or not the work is paid for from public funds, if, at the time of the entering into of the contract the property or premises is owned by the public body or:
- Not less than 55 percent of the property or premises is leased by a public body, or is subject to an agreement to be subsequently leased by the public body; and
- the portion of the property or premises that is leased or subject to an agreement to be subsequently leased by the public body measures more than 20,000 square feet.
- When the property or premises where the work is to be performed is owned by a public body at the time the contract is awarded, even if the public body is not a party to the contract and the contractor will not be paid with public funds.
- When participating in projects undertaken with the involvement of the New Jersey Economic Development Authority, New Jersey Redevelopment Authority (NJRA), and New Jersey Housing and Mortgage Finance Agency (NJHMFA). Also, effective August 23, 2004, projects undertaken with the involvement of the Casino Reinvestment Development Authority, New Jersey Educational Facilities Authority, New Jersey Healthcare Facilities Financing Authority, or a County Improvement Authority require the payment of prevailing wage. Effective November 7, 2005, projects undertaken with the involvement of the New Jersey Commerce, Economic Growth, and Tourism Commission (including the Urban Enterprise Zone Authority) require the payment of prevailing wage. Such involvement can be in the form of loans, loan guarantees, expenditures, investments, tax exemptions or other incentives or financial assistance.
Provided that the application is properly completed, a certificate of registration will be mailed to the applicant within 30 days from the receipt of the application.
In order for a project to be subject to prevailing wage, the total value of the project must exceed $15,444 (effective July 1, 2019, the amount is $16,263) if the work is being done for, or on property or premises owned by, a municipality; or $2,000 if the work is being done for, or on property or premises owned by, any other public entity, including boards of education and municipal utility authorities.
Yes. The following Authorities must require that contractors and subcontractors performing work on projects that have received financial assistance from those Authorities pay prevailing wage rates as determined by the Commissioner of Labor and Workforce Development when they meet the definition of "public work":
- NJ Economic Development Authority
- NJ Redevelopment Authority (NJRA)
- NJ Housing and Mortgage Finance Agency (NJHMFA)
- Urban Enterprise Zone Authority (NJ Commerce, Economic Growth, and Tourism Commission)
- Casino Reinvestment Development Authority
- NJ Educational Facilities Authority
- NJ Health Care Facilities Financing Authority
- Any County Improvement Authority
You will find listings of projects and contact information on the following websites. Please be advised that some sites may also list projects awarded by a County Improvement Authority, which are, therefore, 'public works' projects, as defined above.
Please Note: The New Jersey Department of Labor and Workforce Development cannot guarantee the accuracy or completeness of information contained on the below-listed websites.
New Jersey Economic Development Authority:
http://www.njeda.com/
New Jersey Redevelopment Authority:
http://www.njra.us/
New Jersey Housing and Mortgage Finance Agency (NJHMFA):
http://www.nj.gov/dca/hmfa/
Urban Enterprise Zone Authority:
http://www.state.nj.us/dca/affiliates/uez/index.shtml
Casino Reinvestment Development Authority:
http://www.njcrda.com/
New Jersey Educational Facilities Authority:
http://www.njefa.com/
New Jersey Health Care Facilities Financing Authority:
http://njhcffa.com/
County Improvement Authorities: (some counties do not list a County Improvement Authority on their website.)
The following authorities list projects undertaken with their involvement, on their website:
Cumberland County Improvement Authority:
http://www.ccia-net.com/
Gloucester County Improvement Authority:
http://www.gcianj.com/
Mercer County Improvement Authority:
http://www.mcia-nj.com/
Passaic County Improvement Authority:
http://www.passaic.countynj.org
Somerset County Improvement Authority:
http://www.co.somerset.nj.us/government/administrator-s-office/improvement-authority
The following authorities do not list current projects on their website:
Camden County Improvement Authority:
http://ccia.camdencounty.com/
Hudson County Improvement Authority:
http://hcia.org
Monmouth County Improvement Authority:
http://www.co.monmouth.nj.us/page.aspx?ID=1553
The following County Improvement Authorities do not currently have websites. Other contact information is provided:
Essex County: Mr. Abramowitz, Essex County Director of H.R. (973) 621-4977.
Salem County: Mr. Jack Kugler, Director, jkugler@salemcitynj.com.
Union County: (908) 820-9710
The following counties do not currently have Improvement Authorities: Cape May, Hunterdon, Ocean, Sussex, and Warren Counties.
County websites are listed on the State of New Jersey website at:
https://www.nj.gov/nj/gov/county/localgov.html
Yes. Contractor Registration is required on any project for which New Jersey prevailing wage is required.
Yes, if the particular Term Contract is for work that would be subject to the PWA, the vendor would be required to pay the applicable Prevailing Wage rates and would be required to have a valid Public Works Contractor Registration Certificate. The types of work that are subject to the PWA are discussed elsewhere in the Frequently Asked Questions.
A public agency has the following responsibilities under this or any public works contract:
- To determine if the value of the work exceeds the PWA value threshold (effective July 1, 2014, the amount is $15,444 for municipalities; effective July 1, 2019 the amount is $16,263 for municipalities; $2,000 for all others)
- If the value exceeds the threshold, request a Prevailing Wage Rate Determination from the Department here.
- To include the Determination in the contract with the contractor
- To accept and file Certified Payrolls from the contractor
Financial assistance, by or through the BPU, to an otherwise privately-funded project, subjects the work to a requirement to pay Prevailing Wage. This includes solar installations and weatherization projects.
The amount of the contract must exceed the prevailing wage contract threshold for municipalities described in paragraph (a) of subsection (11) of the New Jersey Prevailing Wage Act (C.34:11-56.26), in order for the work to be subject to Prevailing Wage.
No, rebates given directly to a homeowner (or tenant) for energy-related work or other improvements to be performed at their place of residence do not carry a requirement to pay Prevailing Wage.
Yes, SRECs/TRECs for any solar project connected to the distribution system with capacity of one megawatt (dc) or more will be deemed financial assistance from the BPU and subject to prevailing wage.
Prevailing wage rates are generally set for each of the State's twenty-one (21) counties.
A "wage determination" lists the wage and fringe benefit rates for each classification of laborer and craftsman which the Commissioner of Labor and Workforce Development has determined to be prevailing in a given locality. The public body must provide a copy of the wage determination issued for a project at the time of awarding the contract.
Note: the public body's failure to supply rates is not sufficient defense for the contractor's failure to pay prevailing rate.
Yes. The scale of wages must be posted in a prominent and accessible place at the work site or at such places that are used by employers to pay workers their wages.
Contact the Division of Wage and Hour Compliance at (609) 292-2259 or (609) 292-2283.
The Craft Prevailing Wage Rate in effect at the time the contract is awarded applies, but the contractor is responsible to comply with any projected wage rate increases indicated in that wage determination.
The Prevailing Wage Act defines custom fabrication as the fabrication of plumbing, heating, cooling, ventilation and exhaust duct systems, and mechanical insulation that is going to be installed on a public works project.
Yes; the fabrication of plumbing, heating, cooling, ventilation or exhaust duct systems, and mechanical insulation that is to be installed on a public works project is subject to Prevailing Wage, even when the fabrication work is performed at a location other than the public works jobsite.
The firm must meet the following requirements:
- Possess a Public Works Contractor Registration Certificate from the Division of Wage and Hour Compliance, obtained by submitting a completed application for registration with a non-refundable fee
- Upon approval from the Division, pay the craft-appropriate Prevailing Wage rate to the workers performing the fabrication work
- Record workers names, work classifications, daily/weekly hours, and rate of pay
- If any workers are classified as “Apprentices” in a certified apprenticeship program:
- Documentation of enrollment in approved programs is required
- Proof of cost and coverage if the employer claims credit for fringe benefits provided is required
- Custom fabricators must submit Certified Payrolls to public body like all other public contractors/subcontractors
Refer to the definition of "public work.”
No. See the definition of "public work.”
Yes, such activities would be subject to both the New Jersey Prevailing Wage Act and the Public Works Contractor Registration Act. However, activities such as programming of existing systems, placing, or plugging in of equipment, would not be subject to either Act.
The classification "Electrician - Teledata" applies to service, maintenance, moves, or changes to wiring and devices for telephone or internet connectivity, and is limited to 15 or fewer drops. It cannot be used for work in any new construction project. Work in new construction, or consisting of more than 15 drops, is classified as "Electrician".
Contractors and subcontractors must:
- Be registered with the Department of Labor and Workforce Development, pursuant to the Public Works Contractor Registration Act
- Pay prevailing wage rates based upon work classifications actually worked for all actual hours of work
- Post a wage determination in a prominent place where workers have access
- Submit certified payroll records to the public body within 10 days of payday
- Permit on-site inspection and employee interviews by authorized representatives of the Commissioner of Labor and Workforce Development
- Produce payroll-related records to authorized representatives of the Commissioner within 10 days of a request
The Prevailing Wage Rate Determination in effect on the date of the purchase order/contract issued by the public body for whom the work is to be performed would apply.
No, if your firm is strictly a supplier of materials you would not be subject to either the New Jersey Prevailing Wage Act or the Public Works Contractor Registration Act unless your contract calls for installation, whether or not the work is done by your firm or a sub-contractor.
Yes, the Certified Payrolls must be submitted to the public agency awarding the contract or purchase order.
All employers must pay wages to all employees in full at least twice a calendar month.
A "certified payroll record" is a payroll record which is certified by a principal or authorized agent of any business entity employing covered workers on a public project, to be true and accurate.
Such records shall be submitted for each payroll period within ten (10) days of the payment of wages.
Yes. The information required for owner/operators is the same as for employees, with no exceptions.
No. The law requires that all subcontractors and contractors file certified payrolls within 10 days of pay dates with the awarding public body. An original signature certifying the accuracy of the payroll records is required on the payroll filed with the public body.
Yes. You are an employee of the corporation. Therefore, you must report and pay yourself just as you would any other employee.
The highest standard applies, whichever rate is higher must be paid. Both laws must be followed, since prevailing rate is a minimum wage, by paying the higher rate, both laws are satisfied.
An employee may only be paid the apprentice rate if he or she is enrolled in an apprenticeship program that is approved by the United States Department of Labor - Bureau of Apprenticeship and Training. Otherwise, the employee must be paid at least the 'Journeyman' rate.
Yes. Foremen who are performing "hands on" work must be paid prevailing rates of pay in the appropriate classification(s) for the "hands on" work.
A company may take credit for the actual cost of providing their employees certain fringe benefits, such as: Medical/Hospitalization coverage, Dental coverage, Pension or Retirement plan, Paid Time Off (vacation, holidays, sick days), or Life Insurance. To calculate the cost per hour, divide the annual cost of the benefits by 2,000 hours, for each employee. This amount should be entered in the column labeled "Total Fringe Benefit Cost / Hr." on the Certified Payroll Form, for each employee.
Items such as use of company vehicles or cell phones, lodging reimbursement, or company-provided tools may not be credited towards the Prevailing Wage. Under no circumstances may statutory deductions (Unemployment Insurance, Income Tax, etc.), Workers' Compensation Insurance, or the portion of any fringe benefit that is deducted from the employee's pay, be credited towards the Prevailing Wage.
Yes, there are no exemptions for owner/operators or sole proprietors.
File a wage complaint here.
Workers should keep a record of their hours and save their pay stubs to help verify the amount of wages received. If work is being performed in more than one classification, the worker should identify at what time of the day he or she was doing the various jobs, as well as the total hours worked in each classification.
When a complaint is received, the Department of Labor and Workforce Development will investigate.
Contractors who violate the provisions of the Prevailing Wage Act are subject to administrative fees and penalties and may be prohibited from engaging in future public works projects.
Yes.
Yes.
Yes, when picking up materials from the public works project, they are considered a contractor, and therefore are subject to Contractor Registration. The material supplier would also be subject to Contractor Registration, as they too would be considered a contractor, in this situation.
They would be subject to Prevailing Wage when picking up and hauling materials from the jobsite, but not while delivering to the jobsite.
No, material suppliers are exempt from Prevailing Wage/Contractor Registration, unless they are also acting as a contractor.
While hauling materials to a public works site, and while returning to the supplier to pick up another load, the “Truck Driver – Material Delivery Driver” rates apply. While hauling materials from a public works site, and while returning to the site to pick up another load, the “Truck Driver” rates apply. The “Truck Driver” rates also apply when operating on-site. See the next 2 questions for information regarding “blended” rates.
Except in counties for which the Wage Determination shows a “blended rate”, the time would be “split” – while hauling the asphalt to the site, the “Truck Driver – Material Delivery Driver” rate would apply, and while hauling the millings from the site, the “Truck Driver” rates would apply. If there is a blended rate published for the county in which the jobsite is located, the blended rate must be used.
If shown in the Wage Determination applicable to the county in which the jobsite is located, the blended rate is paid to a truck driver who is performing work on the site (including removal of materials) and also serving as a material delivery driver. This “round robin” must continue for a minimum of 6 hours.
Yes. The removal of the dirt is part of the work included in the public works contract, therefore any trucker removing the dirt is considered a subcontractor.
Yes.
No.
The delivery of items that require set-up or installation is subject to Prevailing Wage / Contractor Registration, if the items are required by the contract. The “Truck Driver” rates would apply to such deliveries.
The rates applicable to the county in which the public works site is located.
The rates applicable to the county in which the public works site is located.
Prevailing Wage would apply from when the driver reached the asphalt plant until when he left the public works site for the last time that day. The initial leg of the trip (to the asphalt plant) and the final leg of the trip (back to the company’s yard) would not be subject to Prevailing Wage (but would be subject to basic Wage and Hour laws).
Yes, Prevailing Wage begins as soon as the driver arrives at the plant.
