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Wage Rates Used for BHA Projects

Wage Rate Classifications
Each job performed for the Bremerton Housing Authority will have a prevailing wage requirement. The prevailing wage rate that is required for each job will be defined by a wage determination that will be issued with the solicitation requesting bids or proposals from contractors.
  • The contractor must comply with the certified payroll requirements outlined in the project contract. The certified payroll must list employees working in each job classification exactly as the job classification is defined in the wage determination to ensure that there is no ambiguity during a certified payroll review by BHA or audit by the funding agency.
  • If an employee works in more than one job classification, the time worked in each classification must be documented separately and the appropriate wage and fringe benefit rates must be paid for each classification.
  • The contractor must ensure that the job classifications that will be used on the job are included in the wage determination provided in the solicitation or contract. If the job classification is not included in the wage determination, the contractor must request that the job classification be added by contacting the Bremerton Housing Authority in writing as soon as possible. The request for an additional job classification must be processed by the funding agency and can take some time to complete. Until the job classification is added to the wage determination, the exact wage and fringe amounts for that job classification are not definite. BHA will work with the contractor to determine the amount of wage and fringe to pay until the actual amount is approved, but the contractor may be required to pay restitution to the employee if the amount already paid is less than what is approved. If this is the case, BHA and the contractor will work together to ensure that the contractor is fairly compensated for this additional expense.

 

Certified Payroll
All projects contracted by BHA require certified payroll. Contractors must be familiar with the requirements and format of certified payroll. As this is a complex topic, a full discussion of certified payroll cannot be covered here. There are, however, some items the contractor should note:
  • The contract will specify whether certified payroll will need to be submitted to BHA or maintained at the contractor's office.
  • If the certified payroll is maintained at the contractor's office, it must be made available upon request by BHA or the funding agency for review.
  • Certified payroll forms vary based on the type of funding for the project. State prevailing wage certified payroll forms may be found on the Department of Labor & Industries website. Certified payroll forms for HUD and Davis Bacon projects may be found on the U.S. Department of Labor website.
  • Certified payroll requirements for Owner/Operator are varied depending on who performs the work. Please click here for more information on Owner/Operator guidelines.
  • BHA will work with the contractor to ensure that all of the requirements for certified payroll are met.
Owner/Operator

If the work performed on a project is performed solely by an owner/operator, there is no prevailing wage required. The company is required to comply with certified payroll requirements though. The owner would be listed with "Owner/Operator" in the job classification column.

If the only employee listed is the Owner/Operator, the certified payroll must be executed by the contractor and the contractor at the next level up (subcontractor and prime contractor) or the contractor and Bremerton Housing Authority.

If the Owner/Operator is listed on the certified payroll with other employees that are subject to the prevailing wage requirement, the certified payroll is executed by the contractor only.

Overtime Requirements

State Overtime Requirements:

Overtime is defined as any hours worked by an employee that are above 40 hours in a 7-day workweek.

An employer must pay 1.5 times the regular hourly wage rate which includes any cash payment of benefits. If an employee receives $20 in wage and $10 in cash payment of benefits, the employee's overtime is calculated using a regular hourly wage rate of $30 - or $45 at time and a half.

Federal Overtime Requirement:

Overtime is defined as any hours worked by an employee that are above 40 hours in a workweek.

The employee must be paid 1.5 times the regular hourly wage rate plus the required fringe benefits at straight-time. If an employee receives $20 in wage and $10 in cash payment of benefits, the employee's overtime is calculated using a regular hourly wage of $20 with the $10 in fringe added to the hourly overtime rate - or $40 at time and a half.

Additional Resources

There are various resources available to contractors who require or are interested in additional information on federal and state prevailing wage requirements.

Seminars may be found by clicking on the links below:

HUD and Davis-Bacon Wage Requirements Seminars - Check with U.S. Department of Housing and Urban Development Website by clicking here.
State Prevailing Wage Requirements Seminars - Check with Department of Labor and Industries Website by clicking here.

Guidebooks may be found by clicking on the links below:

Davis-Bacon Act Guidance
State Prevailing Wage Guidance
 

 

Example of how Wage and Fringe Benefits must be paid

The Bremerton Housing Authority is required to pay wage rates specified by the project's funding. Because wage rates and fringe benefits can be difficult to understand, examples are provided below for a laborer under the Non-Routine Maintenance Wage Rate Determination. These options apply to all labor classifications for HUD routine and non-routine maintenance wage rates, Davis-Bacon wage rates, and state prevailing wage rates.

Information for Examples Below:
Required Laborer (Non-Routine) Wage Rate as of October 1, 2015 - $15.44 per hour
Required Laborer (Non-Routine) Fringe Benefit as of October 1, 2015 - $4.68 per hour
Minimum Wage Rate and Fringe Benefit that must be paid in some combination - $20.12 per hour ($15.44 per hour + $4.68 per hour)


The employee must receive the minimum wage rate in wage. So the employee must receive at least $15.44 for every hour of work performed.

The cost of all benefits provided to the employee needs to be converted to an hourly cost in order to determine whether the employer is currently paying $4.68 or more in benefits. Fringe benefits include: vacation (including paid holidays, personal days); health and welfare (sick pay, health and/or life insurance); pension (retirement/annuity plans); and apprenticeship/training programs. Only employer contributions may be counted toward this figure. Employer payments which are mandated by Federal, state or local law (e.g., Social Security, State disability or unemployment insurance) are not considered fringe benefits.

Example #1:
After converting the cost of fringe benefits for the employee to an hourly rate, the company has determined that it provides fringe benefits to the employee of $4.68 or more per hour. The company is only required to pay the employee $15.44 per hour in wages. The company may pay more than that amount, but that is the minimum amount the employee must receive for each hour worked in that classification.


Example #2:
After converting the cost of fringe benefits for the employee to an hourly rate, the company has determined that it provides fringe benefits to the employee of only $2.00 per hour. Because this amount is lower than the $4.68 required by HUD, the remaining $2.68 per hour must be paid in addition to the minimum wage rate. The company is therefore required to pay the employee $18.12 ($15.44 + $2.68) per hour in wage and fringe. The company may pay more than that amount, but that is the minimum amount the employee must receive for each hour worked in that classification.


Example #3:
The company pays no fringe benefits to its employees. It will need to pay the full amounts of both the wage rate and fringe benefit amount to the employee for each hour worked. The employee must receive $20.12 ($15.44 + $4.68) per hour. The company may pay more than that amount, but that is the minimum amount that the employee must receive for each hour worked in that classification.


Employee works in more than one job classification:
If an employee performs work in two (or more) job classifications, that employee must be paid the wage rate for the appropriate job classification for however many hours are worked in that classification. If that person works as a laborer for three hours and a plumber for five hours, that employee needs to receive the laborer's wage and fringe benefit amount for three hours and the plumber's wage and fringe benefit amount for five hours.

Owners/Operators:
If a company is owned by a sole proprietor or partnership, HUD wage rates and fringe benefit amounts to do not apply to the owner(s) of the company. Those rates do apply to any employees that the company has.


Davis Bacon Wage and Fringe Benefit Rates

Most BHA projects are funded at least in part by federal dollars, so either HUD wage rates or Davis Bacon wage rates apply. BHA has few jobs that require Davis Bacon wage and fringe rates, and the contractor will be informed that these apply in the solicitation for the project. The applicable wage determination will be included as part of the solicitation packet and will be finalized in the contract executed by the Bremerton Housing Authority and the contractor. The wage and fringe rates provided in the solicitation must be used when developing the proposed estimate for the work.

When determining whether the contractor pays any fringe benefits to third parties (needed to determine what amount the employee will be paid per hour for both wage and fringe benefits), HUD states the following in its "A Contractor's Guide to Prevailing Wage Requirements for Federally-Assisted Construction Projects" (January 2012):

Fringe benefits can include health insurance premiums, retirement contributions, life insurance, vacation and other paid leave as well as some contributions to training funds. Fringe benefits do not include employer payments or contributions required by other Federal, State or local laws, such as the employer's contribution to Social Security or some disability insurance payments.

State Prevailing Wage and Fringe Benefit Rates

If a project is funded entirely with non-federal funds, then only state prevailing wage rates are required. This rarely happen with BHA projects, but it does occur occasionally. The applicable state prevailing wage requirements will be included in the solicitation for the project and will be finalized in the contract executed by the Bremerton Housing Authority and the contractor. The wage rates provided in the solicitation must be used when developing the proposed estimate for the work.

When determining whether the contractor pays any fringe benefits to third parties (needed to determine what amount the employee will be paid per hour for both wage and fringe benefits), the following is how the State defines "usual (fringe) benefits" in RCW 39.12.010, WAC 296-127-014, and WAC 296-127-01410:

The prevailing rate of wage also includes usual benefits. Usual benefits include medical insurance, pensions, approved apprenticeship training programs, and vacation and holiday pay. Deductions from workers paychecks are not usual benefits. Usual benefits are employer paid. Benefits that are required by law (industrial insurance, Social Security, etc.) do not qualify as usual benefits. Employers must pay a wage and usual benefits package that adds up to the prevailing rate of wage. Employers are not required to provide usual or fringe benefits and, if they do not, the total prevailing wage rate must be paid as an hourly rate.
 

HUD Routine and Non-Routine Maintenance Wage Rates

HUD Routine or Non-Routine Wage Rates apply to any BHA project that is federally funded but not covered by the Davis Bacon Act. HUD wage rates are changed periodically - primarily when a new collective bargaining agreement is reached between the Bremerton Housing Authority and the Teamsters Union. Contractors will be notified by BHA when the wage rates change.

HUD defines work as either routine or non-routine.

  • Routine work is what happens on a regular and frequent basis. Maintenance staff and janitorial staff fall in this category.

  • Non-routine work occurs less frequently and is not necessarily scheduled. This would include electrical or roofing work - or any other work performed by a classification in that wage determination. There are inspections and service work that are performed annually by licensed contractors (HVAC, elevator, etc.). Although these inspections and services routinely occur each year, they are subject to the non-routine maintenance wage rates because of the required qualifications of the contractor performing the work.

  • The Bremerton Housing Authority will define which wage rate is to be used when issuing the solicitation for the work.
How wage rates are determined

The wage rates that apply to a particular project are determined by the type of funding that is being used for the project. The Bremerton Housing Authority works with the funding agency to determine the type of wages to be used - Davis-Bacon, HUD Routine or Non-routine, or State Prevailing wage rates. The appropriate wage rates will be defined in the solicitation for the project, and those wage and fringe benefit rates must be used when developing the proposal. The wage rates are finalized in the contract executed by the contractor and the Bremerton Housing Authority. Once the contract is executed, the wage rate requirements for that project will not change.

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Bremerton Housing Authority
600 Park Avenue
Bremerton, WA  98337

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