Quick Reference to Standard Wage Rates for Certain Service Workers
How to Calculate Fringe Benefits
Discharging Fringe Benefit Obligations
Under the Public Service Contract Act
In order to meet their obligation under Public
Act 99-142, employers are allowed to pay the fringe benefit portion of the
prevailing wage rate in cash, by incurring costs for bona fide fringe
benefits or by a combination of cash and benefits.
An employer can pay less than the required,
minimum hourly wages as long as the hourly rate plus the fringe benefit
provided equals the total wage required.
In order to receive credit, the employer must
provide bona fide benefits and those common to the specific industry. No
credit can be taken for any benefit required by law (e.g, social security
contributions or workers compensations, etc.).
An employer may take credit for the annual
cost of a benefit by converting the costs to an hourly cash equivalent
(annual cost of fringe benefit divided by total number of hours worked in
the year). If the cost of a benefit varies per employee, the credit must be
Employees excluded from a benefit plan for
whom the employer makes no contribution or incurs no cost must be paid in
cash or furnished other bona fide fringe benefits equal in monetary value.
If the plan requires contributions to be made during eligibility waiting
period, credit may be taken. No credit is allowed for contributions for
employees who by definition are not eligible to participate in the plan.