Navigating IG and Compliance Oversight
A certified payroll report, or “CPR” as it is more generally called, is a specialized report that contractors and subcontractors are required to submit when working on federally funded, federally assisted, state, or local projects that are subject to the Davis-Bacon Act or state/local prevailing wage laws. The report provides a detailed account of employee wages and hours, ensuring that workers are being paid the correct prevailing wage and benefits as required by law. It’s called “certified” because the person preparing it must sign a statement of compliance, certifying under penalty of perjury that the information is accurate and that all workers have been paid in accordance with the regulations.
Certified payroll reporting is a critical part of ensuring fair competition among contractors and protecting workers from being underpaid. It provides government agencies and project owners with a mechanism to monitor and enforce prevailing wage laws, which helps to maintain a level playing field for all bidding contractors. For contractors, accurate and timely reporting is essential for maintaining a good reputation and avoiding financial and legal repercussions.
Certified payroll is required for many public works projects, including those funded or assisted by federal programs as well as projects covered under state and local prevailing wage laws. This can include construction, alteration, or repair of public buildings or public works. The requirement applies to both prime contractors and all levels of subcontractors involved in the project. Certified payroll reports must typically be submitted on a weekly basis.
The Davis-Bacon Act (DBA) is a foundational piece of legislation that mandates that contractors and subcontractors on federally funded construction projects valued at over $2,000 must pay their laborers and mechanics no less than the local prevailing wages, including fringe benefits. Certified payroll reporting is the primary tool used to demonstrate compliance with the wage and benefit requirements set forth by the Davis-Bacon Act.
Further, many states and municipalities have passed their own “Little Davis-Bacon” or local prevailing wage laws that mirror these federal requirements. In those cases, certified payroll reporting plays the same role – it’s the official record that contractors and subcontractors are complying with state or local prevailing wage standards. Additionally, many of these state and local prevailing wage counterparts have their own thresholds and requirements that must be followed. Whether at the federal, state, or local level, certified payroll reporting is the primary tool agencies and project owners use to verify wage compliance on public works projects.
While both certified payroll and regular payroll reports are used to calculate wages and withholdings, they serve distinct purposes and have different requirements. For example, regular payroll applies to all employees in the private sector for general business operations. Certified payroll reports, on the other hand, is specifically for employees working on public works projects that fall under federal, state, or local prevailing wage laws. Additionally regular payroll adheres to standard tax laws and general labor regulations.
Certified payroll reports, however, have much more stringent reporting requirements, including the submission of a signed statement of compliance to the contracting government agency. A generic CPR template won’t always be enough, as different states and localities may have their own laws and formats they will accept. Furthermore, differences are also found in the wage rates. For example, the wage rates for CPR compliance are not determined by the employer, but are instead based on the prevailing wage rates for a specific geographic area and job classification, as determined by the U.S. Department of Labor (and their state counterparts).
The Davis-Bacon Act (DBA) requires record retention for at least three years after the completion of a project. An auditor could request these records at any time. State and local prevailing wage laws, on the other hand, often have different requirements for certified payroll recordkeeping. For example, the requirement is five years in California and six years in New York. The bottom line is, contractors need to follow federal Davis-Bacon rules and the stricter state or local requirements, if applicable.
The penalties for non-compliance with certified payroll reporting are severe and can have significant financial and reputational consequences for both agencies and contractors. For example, non-compliant contractors may be required to pay back wages, and they can face hefty fines. Further, non-compliance can lead to legal issues and debarment from future federal or other public contracts. Finally, violations are often a matter of public record, which can lead to reputational damage that affects a company’s ability to secure future projects.
Final Thoughts
Certified payroll reporting is a complex, but essential, part of the public works contracting industry. It is a critical component of labor compliance that protects workers and ensures fair competition. While manual processes can make certified payroll reporting tedious and prone to errors, a modern, cloud-based solution like eComply is designed to simplify and automate these processes. With features like real-time tracking, automated review of CPRs, wage determination updates, and seamless data integration, eComply helps agencies and contractors to minimize administrative burdens and reduce the risk of non-compliance, allowing these organizations to focus on the work itself.
For agencies, it provides a verifiable framework for oversight, allowing agencies to confidently manage a network of contractors while upholding legal and ethical standards. This transparency builds trust with stakeholders and protects the agency’s reputation. For contractors, eComply is more than just a requirement; it’s a competitive advantage.
By demonstrating a proactive commitment to compliance, contractors can win more contracts and avoid costly penalties. Additionally, it simplifies a contractor’s operations by centralizing all necessary documentation, training, and reporting, turning a potential administrative burden into a streamlined system for growth. Ultimately, embracing eComply isn’t just about following the rules – it’s about creating a more efficient, secure, and trustworthy environment for everyone involved. Request a demo and learn more about how eComply can support your organization by automating and streamlining certified payroll and labor compliance.
The U.S. Department of Labor (DOL) plays a crucial role in overseeing federal worker wages, safety, and utilization for contracts receiving federal funding. Among its many responsibilities, the Davis-Bacon and Related Acts (DBRA) stand out as a cornerstone for fair labor practices in public works.
The U.S. Department of Labor (DOL) oversees federal worker wages, safety, and utilization for contracts receiving federal funding. The Davis-Bacon and Related Acts (DBRA) applies to contractors and subcontractors working on construction, alteration, or repair (including painting and decorating) of public buildings or public works and says that contractors must pay their laborers and mechanics employed no less than the local prevailing wages and fringe benefits for corresponding work on similar projects in the area. The DBRA applies to wages, fringe benefits, and overtime. Most states have implemented their own version of the Davis-Bacon Act, which are often referred to as Little Davis-Bacon.
This act is essential because it guarantees that laborers working on public contracts receive fair pay according to local wage rates. This prevents exploitation, helps workers contribute fairly to their communities, and ensures a level playing field. Non-compliant contractors may face penalties and fines for not following prevailing wage requirements. eComply Labor Compliance solution offers a digitized approach for organizations and their prime contractors to track and manage contracts, subcontractors, workforce utilization, and wages by project, providing a consistent and accurate way to deliver reports as required by regulations.
The main goal of the Davis-Bacon Act is to establish clear rules for public agencies and their contractors about worker wages on public infrastructure projects. Passed during the Great Depression, it aimed to stop contractors from hiring out-of-town workers at lower wages, which lowered local wage levels. By safeguarding workers, promoting fair competition, and supporting skilled labor, the act continues to play an important role.
The Davis-Bacon Act is enforced by the US Department of Labor’s Wage and Hour Division (WHD). The WHD conducts routine audits and investigates complaints filed against contractors to identify violations. In states with “Little Davis-Bacon” acts, the equivalent state department, such as California’s Department of Industrial Relations (DIR), handles enforcement.
The Department of Labor’s Wage and Hour Division continuously reviews and monitors wages across the country. They maintain the SAM.gov website, a valuable resource where agencies and contractors can search for wage information. Several factors, including average wages in the region, craft and work classifications, job titles, and historical local wages, determine prevailing wages.
Yes, Davis-Bacon wages are adjusted for inflation. Typically, these wages are updated twice a year. However, in instances of significant changes in labor market conditions, updates can occur more frequently to accommodate those shifts.
Navigating the complexities of the Davis-Bacon Act and ensuring compliance can be a major challenge for organizations and their contractors. B2Gnow’s eComply Labor Compliance solution provides a digital platform for tracking and managing contracts, subcontractors, workforce utilization, and project-specific wages. This automation ensures accurate and consistent reporting that meets regulatory standards, while also keeping wage rates up-to-date with real-time updates, reducing the risk of a Department of Labor audit.
To learn how eComply can streamline your labor compliance processes and help your organization stay audit-ready, request a demo today.
Navigating the rules around prevailing wages can be tricky for agencies and contractors, especially when working on a mix of public and private projects. While the Davis-Bacon Act sets federal standards for wages on certain federally funded projects, not every construction job falls under these rules. Having a clear understanding when prevailing wages apply, as well as how state laws may add their own requirements, can help contractors stay compliant and avoid costly penalties.
The U.S. Department of Labor (DOL) sets prevailing wages, known as Davis-Bacon wages, for federally funded construction projects. These wages, along with fringe benefits and overtime, are mandated by the Davis-Bacon and Related Acts (DBRA) for contractors and subcontractors involved in the construction, alteration, or repair of public buildings or public works. The DBRA ensures that laborers and mechanics on these projects are paid at least the local prevailing wages and benefits for similar work in the area. Many states have also adopted their own versions of this act, often referred to as “Little Davis-Bacon.”
Davis-Bacon wage determinations are published on SAM.gov by the U.S. Department of Labor’s Wage and Hour Division. This division reviews and monitors wages nationwide and maintains the Sam.gov website, where agencies and contractors can search for prevailing wages related to their contracts. These wage determinations set the minimum hourly rates and fringe benefits that must be paid to laborers and mechanics on federally funded construction projects. Prevailing wages are determined based on factors such as regional averages, crafts and work classifications, job titles, and historical local rates. Prime and subcontractors sourcing workers for public projects can search the wage database to find the correct wage. If the organization uses eComply, the process of inputting and maintaining wage data is done for them at no additional cost.
The Davis-Bacon wage rate is the prevailing wage set by the U.S. Department of Labor (DOL) for a specific project location, worker classification, and type of work. These rates are updated periodically, often semiannually, but may be revised more often if economic conditions or local wage surveys suggest a change is necessary. The wage rate determines the minimum hourly pay and fringe benefits that must be provided to laborers and mechanics working on federally funded construction projects.
Prevailing wages are determined using a three-step calculation method established by the U.S. Department of Labor:
These wages are often used for public works projects and government contracts to ensure fair pay based on local labor market conditions.
Prevailing wage requirements ensure that workers on public works projects receive fair compensation based on local labor market conditions. These requirements typically include:
In California, for example, all workers on public works projects must be paid prevailing wages. Similarly, for certain clean energy tax incentives under the Inflation Reduction Act (IRA), the Treasury Department and IRS require compliance with prevailing wage and apprenticeship standards as defined by the DOL. The DOL provides the guidance and determinations used to verify compliance.
A solution like eComply can help agencies and contractors by digitizing the prevailing wage process. The solution organizes, tracks, and calculates reported wages to actual wages and flags any discrepancies. It will also notify the contractors if there are apprenticeship requirements and can track that data as well.
Davis-Bacon Act is the rule that sets the standards for the prevailing wage. Sometimes people refer to it as Davis-Bacon wage.
Davis-Bacon fringe benefits are additional compensation that employers must provide to workers on federally funded construction projects. These benefits can be given in two ways:
Fringe benefits must be provided for all hours worked. When calculating overtime, the value of bona fide fringe benefits can be included in the regular rate for overtime pay, while cash payments are considered part of the worker’s wages. However, payments required by law, such as Social Security or workers’ compensation, do not count as fringe benefits benefits.
The Davis Bacon Act is enforced by the US Department of Labor’s Wage and Hour Division (WHD). The WDH will perform routine audits and will also investigate complaints filed against a contractor, to determine if a violation has occured. If a state has a Little Davis Bacon Act, that state’s equivalent department, such as California’s Department of Industrial Relations (DIR), enforces the law. eComply can help agencies and prime contractors match workers wages as reported in the system to real time wages, and if a discrepancy is found, the system will send notifications to the related parties. This gives them a chance to resolve the discrepancy before the DOL audits them.
No, not all construction projects require prevailing wages under the Davis-Bacon Act. Contractors can determine if prevailing wage requirements apply by considering the following factors:
By knowing the key factors—such as project funding, contract type, thresholds, and applicable state laws—contractors can determine whether Davis-Bacon or other prevailing wage requirements apply to their projects. Staying informed not only helps protect workers with fair pay, but also ensures that projects run smoothly without unexpected compliance issues. For those managing multiple projects or complex contracts, tools like automated wage tracking systems can make staying compliant easier than ever.
Ensure your projects meet federal wage requirements without the stress. Get in touch with our team and let us handle your certified payroll management.
Writing personalized outreach messages doesn’t have to be time-consuming. In 2024, we launched the first AI-powered feature in our B2Gnow Outreach & Events module, Outreach Content Assistant, making it faster and easier to create effective, professional communications to all of your vendors.
Within the Content tab of the Outreach & Events module, a new “Generate Outreach Content” button unlocks a simple, guided form. From there, the AI handles the heavy lifting enabling you to:
The result? An AI-generated email draft tailored to your needs that is delivered instantly. You can:
It’s flexible, editable, and built for speed, helping your team spend less time writing and more time engaging.
Note: This feature is available today, but it’s not enabled by default. Contact B2Gnow Customer Support via the Help Center to have it turned on for your organization.
The Outreach Content Assistant is part of our broader effort to bring AI into compliance workflows in practical, high-impact ways. By reducing time spent on outreach prep, your team can:
AI won’t replace the human touch, but it can make your outreach process significantly more efficient.
To help shape the future of AI in our platform, we’re actively working with customers, including members of our Customer Advisory Board, to better understand their challenges and identify where AI can make the greatest impact. If you’d like to share your feedback or are interested in joining the Customer Advisory Board, please contact B2Gnow Customer Support through the Help Center. To learn more or get started with B2Gnow, please request a demo.
Written by John Garay, Vice President of Product, B2Gnow
Artificial Intelligence (AI) is reshaping how public and private sector organizations manage vendor sourcing, certification processing, labor compliance, and grant management. At B2Gnow, our mission is to streamline these complex processes while expanding opportunities for small, local, and diverse vendors. With AI, we’re extending that mission, helping all stakeholders save time and accelerate results across the public project lifecycle.
Every minute spent on manual work is a minute taken from what matters most: building infrastructure, supporting small businesses, or delivering funding where it’s needed. Our AI vision is centered on delivering practical, time-saving tools across our product suite:
AI in our solutions will be designed to augment, not replace, human expertise, making complex workflows easier, faster, and more accurate.
And because every customer is at a different stage in their AI journey, all AI features will be configurable, giving organizations full control over when and how to adopt them.
We’re actively developing AI capabilities to transform the Online Application (OLA) and Certification Management (CM) process. Planned features include:
As with all our AI features, these will be optional and configurable, allowing agencies to adopt enhancements at their own pace.
Our vision goes beyond certification. We’re exploring how AI can drive results in:
These innovations will deliver the same core benefits of faster outcomes, reduced administrative burden, and smarter decisions across our full solution suite.
We’re committed to adopting AI responsibly and effectively:
This is just the beginning. As we continue to build AI capabilities across B2Gnow, eComply, and BlackCat, we remain focused on one goal: helping you save time, reduce friction, and expand opportunities for the vendors and communities you serve. Learn more and schedule a demo.
Up next: Learn how our first AI-powered feature is already helping customers create faster, smarter vendor outreach campaigns – coming soon in our next blog!
Written by John Garay, Vice President of Product, B2Gnow
