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Certified Payroll Requirements | Forms, Reporting & Processing

January 27, 2017 - minute read

Certified Payroll RequirementsThe mere mention of the term “certified payroll” is enough to give many business owners, managers, and administrators a stress headache. Facing a certified payroll every week can be a grueling, teeth-gnashing experience, and it is a fact of life for many contractors and subcontractors working on publicly funded construction projects.

What Is Certified Payroll?

Certified payroll is a weekly reporting requirement under federal law to ensure compliance with the Davis Bacon Act of 1931. This law was enacted to protect local workers from being displaced by seasonal workers and to ensure that they are paid sufficient wages. It requires contractors to pay employees working on government-funded projects prevailing wages, plus fringe benefits, and to meet certified payroll reporting requirements.

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Who Is Required to Do Certified Payroll?

Any company that contracts to work on federal government construction projects or federally assisted contracts exceeding $2,000 is subject to certified payroll reporting requirements under the Davis Bacon Act and related legislation. This includes small businesses that sign on to federally funded projects as subcontractors.

Since the American Recovery and Reinvestment Act of 2009 (ARRA) was enacted, more construction firms and subcontractors than ever before are subject to the Davis Bacon Act. “Construction” is defined broadly in this context. The act applies to contractors and subcontractors that perform services for plumbing, electrical, HVAC, drywall, painting, decorating, or otherwise altering and/or repairing public buildings; building or repairing roads and bridges; or weatherization.

What Are Certified Payroll Requirements?

The federal government requires contractors subject to the Davis Bacon Act to submit a weekly report on federal form WH347, along with a statement of compliance with the original signature of a company official who signs the document – under penalty of perjury. However, many states have enacted their own “Little Davis Bacon” (prevailing wage) laws, with their own, additional certified payroll reporting requirements.

Under federal law, if your company works on a project covered by the Davis Bacon Act, you are required to submit a report for every week of the project, even if your company performed no work on the project during that week. “No Work” certified payroll reports must be submitted during the weeks your company performs no work. Payrolls must be numbered sequentially, and No Work payrolls are included in the sequence.

Prevailing wage laws require contractors to:

  • Pay employees that work on jobs covered by the Davis Bacon Act the required wage on a weekly basis.
  • Complete and submit weekly certified payroll reports within 7 to 10 business days of the date of the payroll.
  • Keep a complete set of certified payroll reports, along with time cards, payroll, and other basic records for the project for a minimum of 3 years after the project is complete.

There may be additional ARRA, EEOC, and state reporting requirements for a project. If you fail to properly complete and timely submit the required reports, your company will not get paid!

How Certified Payroll is Done – Forms and More

Your certified payroll report header information on form WH347 must include:

  • Company name and address
  • Payroll number
  • Work week ending date
  • Project name
  • Project location
  • Identifying contract or project number
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The payroll information portion of your certified payroll report must include, for each employee:

  • Full name and identifying number (i.e., last 4 digits of Social Security number)
  • Number of federal withholding exemptions the employee is claiming
  • Employee classification in accordance with the work performed on the jobsite
  • Day, date, and hours worked for each day of the work week, with regular, overtime, and double-time hours indicated
  • Total regular, overtime, and double-time hours the employee has worked on the project
  • Base rate of pay for straight time and overtime, plus fringe benefit rate per hour – except contractors that pay fringe benefits to a union or bona-fide Fringe Benefit Plan are only required to show the base pay rate for straight time and overtime
  • Gross amount employee has earned to-date on this specific job – if part of the employee’s wages is for work on other jobs, report gross wages on this job and gross wages on all jobs
  • Payroll tax deductions and other withholding, with an explanation of what other withholding is for (health insurance, union dues, child support, etc.)
  • Net wages for the week – must agree with employee’s take home pay

Certified Payroll Reporting for Your Company

If your company is subject to the Davis Bacon Act, we recommend that you let EPAY Systems process your payroll and do the heavy lifting for you. Our full-service human capital management solutions can simplify your payroll process, make it more accurate and efficient, and transform your payroll and tax administration into a seamless experience.

You can make payroll management stress free and save time and money by offloading your biggest payroll headaches on us. We can handle your:

  • Payroll distribution
  • Tax administration and filing
  • Wage garnishments
  • Certified payrolls
  • W-2 processing

Certified payroll reporting can be an administrative nightmare – that reoccurs every week! Contact us today to learn more about how our centralized payroll processing can help you standardize workflows, maximize production, lower compliance risks – and take the headache out of your certified payroll processing.

Filed Under: Human Capital Management