Chapter RCW, the Prevailing Wage Law

Transcription

1 2014 CASC - MRSC workshop Prevailing Wage Chapter RCW Chapter RCW, the Prevailing Wage Law Requires the payment of prevailing wage to worker based upon classification of labor performed RCW [Pages 24-25] This Act is applicable to all public work involving state agencies or local governments Federal and State prevailing wage laws: For projects where both the state prevailing wage law and the federal Davis-Bacon Act apply, contractors must pay the higher of the state or federal prevailing wage rates, on a classification-by-classification basis WAC [Page 46] 1

2 Washington State Law - Prevailing Wages Required on: Public work: All work, construction, alteration, repair, or improvement Maintenance performed by contract RCW [pgs ], WAC (7) [pgs ], Construction, reconstruction, maintenance or repair RCW [pg. 25] Turn-Key Projects (Certain private construction caused by public entity agreements to lease, rent, or purchase) - RCW [pg. 22] Off-Site Fabrication of Non-Standard Items Unlike the federal law, off-site work specific to the public work requires prevailing wages Building Service Maintenance (janitorial work) RCW [pgs ] Responsible Contractors RCW Before any contract award determine: At the time of bid submittal is the contractor responsible? Is the contractor a registered contractor or licensed electrical contractor? Does the contractor have a UBI? If the contractor has employees does it have industrial insurance coverage? Does the contractor have an employment security department number? Does the contractor have a state excise tax registration number? Is the contractor debarred (not eligible to bid on any public works contract); If the public works project has apprenticeship utilization requirements in RCW , has the contractor been found out of compliance by the Washington state apprenticeship and training council for the one-year period preceding the date of the bid solicitation? Has the contractor violated RCW (reporting off-site pre-fab) more than one time as determined by the department of labor and industries? Contractors hiring subcontractors must verify subcontractor responsibility. RCW CPARB Responsible Bidder Guideline: 2

3 Prevailing Rate of Wage Effective Date Generally, for work that was competitively bid, the prevailing wage rates in effect on the bid due date for the prime contractor are the rates that apply to that contract Except: Use the contract award date if the award was not within 6 months of the bid date. WAC [Pages 37-38] Annual updates are required for building service maintenance (janitorial) contracts. WAC [Page 46] Projects awarded by other than bid use the award date. WAC (4). Job Order Contracts use the issue date of each work order. RCW & 450 and RCW Paperwork: Intents & Affidavits Certified Payroll All contractors and subcontractors at all tiers must file the Intent and Affidavit forms on public work RCW [Pages 26-27] Public Agency liability RCW [page 27] Owner/operators must file Intent & Affidavit forms RCW [pages 26-27] Apprentices are listed by name and registration number on the Affidavit Trainees are not state registered apprentices. Posting of Intent forms on the job site Projects over $10,000 RCW [pages 24-25] No minimum amount or threshold for state prevailing wage even small jobs require prevailing wages Certified Payroll Records are not mandatory under state law but must be produced on the request of an interested party WAC

4 New Legislation SHB 1254 (2014 session) Effective June 12, 2014 If, at the time an individual or entity files an affidavit of wages paid, the individual or entity is exempt from the requirement to pay the prevailing rate of wage under RCW , the department of labor and industries may not charge a fee to certify the affidavit of wages paid. Fees will apply to the Intent Ordinary Maintenance What about the phrase except for ordinary maintenance in the RCW (4) definition of public work? Maintenance work does requires prevailing wages. For prevailing wage, only the work done by regular public employees (not contractors) is exempted as ordinary maintenance. Case law: City of Spokane v. L&I, 100 Wn. App 805,810 (2000). 4

5 Failure to File the Affidavit? Filing On Behalf Of (FOBO): By statute and policy, the hiring contractor can assume liability for any unpaid wages, document an allowable basis for the FOBO, and get a FOBO Affidavit. The policy is on the L&I web site at: Legislative change: SHB 1420 removed the time frame limit for FOBO Now you do not need to wait until 31 days after final acceptance. Because FOBOs involve a compliance investigation (failure to file), they take longer to process. Please do encourage the hiring contractor to request the FOBO ASAP. Combined Intent/Affidavit - Small Works $2,500 or less Combined Intent/Affidavit form This method makes the public contract awarding agency directly liable to workers for unpaid prevailing wages RCW (2)(d) [pages 26-27] Dividing a project to come under the dollar limit is prohibited RCW (2)(e) [pages 26-27] Signature of contracting agency required Awarding agency must retain copies 3 years Send copies of the forms to L&I within 30 days Form fee waived by L&I policy $500 civil penalty for failure to file 5

6 Restrictions on use of alternative combined forms The contract awarding agency decides if the alternative process may be used. The contractor must file the form with the public contract awarding agency. The public contract awarding agency must send a copy to L&I within 30 days. Note: NGOs may not use combined forms since they are not subject to the relevant laws that control public agency use of the combined forms and assign liability for wages. Liability to the public agency for unpaid wages is a condition of using an alternative filing process. See RCW (2)(d) and RCW (4). No subcontractors. No subcontractors are allowed in this alternative process. This helps control exposure to possible liabilities. Single payment. Multiple payments require using a separate (regular) Intent before any initial payment and a separate (regular) Affidavit before the final payment is made. See RCW [pages 26-27] No time and materials. Total cost with tax must be within the form s dollar limit. No dividing or phasing of projects. The law prohibits breaking the project into units or phases to avoid the maximum dollar limit. The public agency must approve the combined forms by signature. No payment may be made until the form is approved by the public agency. $500 civil penalty. Failure to file subject to penalty. RCW [page 27] Prevailing Wages for Apprentices RCW Apprentice workers employed upon public works projects for whom an apprenticeship agreement has been registered and approved with the state apprenticeship council pursuant to chapter RCW, must be paid at least the prevailing hourly rate for an apprentice of that trade. Any worker for whom an apprenticeship agreement has not been registered and approved by the state apprenticeship council shall be considered to be a fully qualified journey level worker, and, therefore, shall be paid at the prevailing hourly rate for journey level workers. WAC Any apprentice employed on public works projects for whom an apprentice agreement is registered and approved by the state apprenticeship council pursuant to chapter RCW within sixty days of hiring may be considered an apprentice and paid the applicable prevailing hourly rate for an apprentice of that trade for all hours worked. 6

7 Apprentice Utilization Requirements Agencies that have apprentice utilization requirements: State agencies that report to the Governor (DES) - Projects over $1 million School districts - Projects over $1 million Four-year institutions of higher education - Projects over $1 million WSDOT - Projects over $2 million RCW Defines Apprenticeship as registered Apprenticeship Defines the utilization requirement as applying to all labor hours on a project and defines which hours count RCW Defines the requirement as 15% of all labor hours have to be performed by apprentices Defines who the utilization requirement applies to Defines reporting requirements, and allowable adjustments to the utilization requirement LNI Apprenticeship Staff: Erik Sackstein Erik.Sackstein@Lni.wa.gov Jody Robbins Jody.Robbins@Lni.wa.gov Emergencies Warranty Work Bidding Exception: Emergencies (RCW ) An emergency means unforeseen circumstances beyond the control of the municipality that either: (a) Present a real, immediate threat to the proper performance of essential functions; or (b) will likely result in material loss or damage to property, bodily injury, or loss of life if immediate action is not taken. Competitive bid requirements may be waived by the governing board in the event of an emergency. Note: Prevailing Wage requirements do apply to emergency work. Tell the contractor this is a prevailing wage job and, after dealing with the emergency, it will be necessary to ensure the workers were paid not less than the prevailing rate of pay and file the completed Intent & Affidavit forms. Warranty Work: Warranty work is additional work on the same public works contract. Prevailing wages are still required. The original Intent on the contract is still effective. A new (amended) Affidavit will be required to report on the new total hours of work. 7

8 ON-CALL CONTRACTS The State Auditor s Office made this statement: On-Call contracts are not specifically authorized in state law. These contracts can result in noncompliance with the public works contracting and prevailing wage statutes. Since the On-Call contracts are not authorized by state law, we recommend local governments establish policies, procedures and internal controls to ensure their contracting process is in compliance with public works contracting statutes (RCW Chapter 39.04, 39.06, and ) as well as prevailing wage statutes (RCW Chapter 39.12). RCW limits alternate forms of contracting: It is the intent of the legislature to establish that, unless otherwise specifically provided for in law, public bodies may use only those alternative public works contracting procedures specifically authorized in this chapter, subject to the requirements of this chapter. RCW Please check with L&I if you have questions about the Intents and Affidavits required for contracts for recurring work. RCW requires an Intent for each contract and an Affidavit for each project. There may be facts that define when you have a new contract and what prevailing rates are applicable. The legislature provided its direction for job order contracts: Prevailing wages for all work performed pursuant to each work order must be the rates in effect at the time the individual work order is issued. RCW (6). For purposes of chapters 39.08, 39.12, 39.76, and RCW, each work order issued shall be treated as a separate contract. RCW (6). Tools to Aid Compliance Track the contractors & subcontractors & their work! Check the UBI, contractor registration, DOR account and L&I industrial insurance account status for all subcontractors. Do you have boilerplate contract language that makes the prime responsible for reporting when a subcontractor first starts work and what days & hours they work, along with the number of workers they have on the project? Does your project manager track and double check this information? Rather than waiting for acceptance, when a contractor s work is complete, secure the Affidavit. Are the contractors posting their Intents? Employee interviews about prevailing wage compliance are effective. They are required for Davis-Bacon projects and a good practice for the state law. 8

9 Prevailing Wage - Tumwater PW1@LNI.WA.GOV Jim Christensen, Industrial Statistician, Program Manager Jim.Christensen@LNI.WA.GOV (360) Ramona Christensen-Russell, Industrial Relations Specialist Ramona.Christensen-Russell@LNI.WA.GOV (360) Marcus Ehrlander, Industrial Relations Specialist Marcus.Ehrlander@LNI.WA.GOV (360) Laura Herman, Industrial Relations Specialist Laura.Herman@LNI.WA.GOV (360) Reasa Pearson, Industrial Relations Specialist Reasa.Pearson@LNI.WA.GOV (360) Desiree Schott, Customer Service Specialist Reasa.Pearson@LNI.WA.GOV (360) Leeann Bosshard, Secretary Supervisor Leeann.Bosshard@LNI.WA.GOV (360)