What is prevailing wage?
rate that is equal to the rate customary or prevailing for the same work
in the same trade or occupation in the town in which such public works
project is being constructed.
How is prevailing wage determined?
the Labor Commissioner has adopted and used the prevailing wage
rate determinations as have been made by the United States Secretary of
Labor, under the provisions of the Davis-Bacon Act, as amended.
What is the obligation of the contracting agency in obtaining
prevailing wage rate schedules?
contracting agency or agent empowered to let a public works contract
shall contact the Labor Commissioner at least ten (10) days, but not
more than twenty (20) days prior to the date such contracts will be
advertised for bid. These initial Rate Schedules are “Project
Specific” and cannot be downloaded from the DOL Web page.
The Date on the initial rate schedule cannot be more than 20 days prior
to the Advertise For Bid Date --- If the project is NOT advertised
within 20 days of the Date appearing on the rate schedule, the
Contracting Agency must contact the DOL by telephone or by Fax to
obtain an updated Initial rate schedule. Rate schedules MUST be included
in the Bid Documents / Bid Specifications at the time of Bid, and not
provided later through an addendum.
shall request the initial prevailing wage rate schedules when:
advertised and competitively bid – awarded to GC or CM
Bids for Design/Build project
Proposals, individual Purchase Orders
Each Phase of a
project or each Prime Contract that is advertised separately by the
CA or CM
where construction or renovation is required or authorized by State
or Political Subdivision
Administrator or Construction manager negotiates a contract to
administer a project for the Contracting Agency – Initial Rates
required for each package when advertised
If a contract is advertised to bid on January
30, then the initial request for a prevailing wage rate schedule should be
made no later than January 20 and no earlier than January 10 to comply with
Any initial prevailing wage rate schedule
dated more than twenty (20) days prior to the advertise for bid date is no
longer valid and must be updated. The contracting agency can obtain
updated rates by calling (860) 263-6549.
Also, be aware that contracting agencies
cannot use the Annual Rates downloaded from the DOL website in the initial
bid package. Annual Rates ONLY apply to ongoing projects and go into
effect each July 1st. If the Annual Rates are improperly
used in the initial bid package, the contracting agency may be subject to a
financial liability if the correct rates are higher.
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Contracting Agency may designate their Agents (Construction
Administrator, Construction Manager, Clerk of the Works) to act on their
Department of Labor, in writing, to request a prevailing wage rate
schedule for each prevailing wage project.
are “Project Specific”, not Generic.
Date on Rate
Schedule cannot be more than 20 days prior to the Advertise for
MUST be included in the Bid Specifications at the Time of Bid,
not provided later through an addendum.
If the project
does not go out to Bid within the 20 days from the date the Rate
Schedule was issued, you must contact DOL (by Phone or Fax) to
request an update.
Each contract must
quote C.G.S. Section 31-53(a), that mandates the requirements of
prevailing wage rates. A mere statutory reference is not
Certify to the
Department of Labor the total dollar amount of work to be done in
connection with the public works project, regardless of whether the
project consists of One or More Contracts.
Contractor’s Wage Certification Form and up to date Certified
Payroll Form to Contractor.
Debarment List to ensure all contractors and subcontractors
performing work on project are not Debarred.
certified payrolls on a monthly basis, by mail (retaining the
are a public document that must be made available to anyone upon
request immediately if in person to view. Copies must be made
available within 4 days upon receipt of written request.
Conduct on site
labor wage checks and maintain Daily Job Reports/Diaries.
payrolls for compliance and refer discrepancies to the Department of
Labor for investigation.
where violation of wage payment is documented and pay directly to
worker, or pay through the Department of Labor on behalf of worker
all wages due.
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What is a Public Works Project?
Connecticut General Statutes Section 31-53 Public Works Projects
This summary is intended
to provide the basis for the Division's determinations as to whether
projects by the State or its agents (and political subdivisions or their
agents) are covered for prevailing wage purposes.
prevailing wage law was enacted to provide for competitive bidding on a
level playing field and at the same time provide an appropriate standard of
living for Connecticut's workers. Over the years, the law has withstood many
repeal attempts. In the 1993 and 1997 legislative sessions, the law was
actually strengthened to ensure increased compliance.
However, the legislature has recognized that not all projects should be
covered by the prevailing wage law. Instead of exempting specific
construction projects the legislature has applied a monetary threshold test.
There are essentially two categories of construction outlined in the statute
(1) new construction and (2) any remodeling, refinishing, refurbishing,
rehabilitation, alteration or repair of any public works projects. The
threshold for new construction has increased over the years from $50,000 of
total cost of all work to be performed to the current $400,000 which was
mandated in 1991. The other category has increased from $10,000 to the
current $100,000 of total cost. Again, the legislative response to exempting
projects was to raise the monetary thresholds.
Labor Department's role is to interpret the law consistently with
legislative intent. Toward that end, the Division has had to commit
extensive resources in enforcement of the law.
Division issues prevailing wage schedules upon the request of the
contracting agency or their agents. Agents can be purchasing officers,
boards of education, architects and other individuals. This means that the
initial assessment as to whether a project is covered is made by the
contacting agency, not the Department of Labor. Section 31-53(e) states in
empowered to let such contract shall contact the Labor
Commissioner at least ten but not more than twenty days prior to
the date such contracts will be advertised for bid, to ascertain
the proper rate of wages
However, when a contracting agency is unsure of the
applicability of the law, it should contact the Division. The Division also
determines coverage if a complaint is received where no rates have been
The following guidelines are used by the Division to determine the
applicability of the law.
At the outset, a
question arises as to what is a public works project. Although, section
31-53 does not specifically define public works project, the Division
has historically relied upon the accepted dictionary definition of
public works as "Construction projects, such as highways or dams
financed by public funds and constructed by a government for the general
public". Webster 's II New Riverside
The Division also
looks to the Federal Davis-Bacon Act for guidance especially since
Federal Davis-Bacon rates were adopted in 1977. The definition of a
public works project under Title 29, Part 5 of the Code of Federal
Regulations covers contracts federally financed or assisted
construction. Section 5.2k provides:
"Public building" or “public work" includes building or work,
the construction, prosecution, completion, or repair of which as
defined above is carried on directly by authority of or with
funds of a Federal Agency to serve the interest of the general
public regardless of whether title thereof is in a federal
two definitions are consistent with each other and essentially require that
the State's (or agent or political subdivision) funds are utilized for the
construction, rehabilitation or repair of a project which serves the
interest of the general public.
One common question
relating to this definition is whether grant-in-aid agreements where the
State or political subdivision is not the contracting agency for the
construction, are considered projects subject to the prevailing wage law.
The Department has historically concluded that when a grantee receives funds
for a primarily private benefit, the subsequent construction would not be
covered under Section 31-53. The state or political subdivision must be a
party to the funding agreement and the entity for which the work is to be
done. The basic rule has been utilized by the Division in finding that
grant-in-aid agreements where (1) the State or political subdivision does
not let out the contract, and (2) the general public does not receive a
benefit - are not covered under Section 31-53.
Once it is determined that
the project is a public works project several scenarios may develop where
the coverage of the law is not evident or confusing to the contracting
agencies. The following is a list of such scenarios with responses based on
past enforcement practices of the Division:
Scenario #1: There is
no classification of the work that will be performed.
Under Section 31-53(d) the Labor Commissioner may either (a)
predetermine the prevailing rate of wages by holding hearings in the
locality where the work is to be performed or (b) adopt and use the Federal
Davis-Bacon rates which are published approximately every three months and
are based upon surveys of prevailing practices in Connecticut. Since 1977,
the practice of the Labor Commissioner has been to adopt and use the Federal
Davis-Bacon rates. If a specific classification is not listed, the
contracting agency can request the Department of Labor to issue a
conformance rate specific to said project. This Division will look for
conformity with existing classifications and again look at prevailing
Scenario #2: The total
cost of one part of the project does not exceed the threshold or the cost
borders on the thresholds.
question often asked is whether each aspect of a contract can be looked at
separately. For example, can we look at just the electrical work,
mechanical, or carpentry etc and if each segment does not reach the $100,000
threshold separately is the project covered? Section 31-53(g) states that
"the provisions of this section shall not apply where the total cost of all
work to be performed by all contractors and subcontractors in connection
with any remodeling, refinishing, refurbishing, rehabilitation, alteration
or repair of any public works project is less than $100,000 dollars". This
section has been interpreted to mean that the entire cost of the project
must be included to determine whether the threshold should be met. The
interpretation was conveyed to DAS in 1986 when it asked whether a task
labor contract for work performed at UConn and UConn Health Center was
covered. This contract asked for bids by the hour for electrical, painting,
carpentry, and plumbing and although each aspect might be under $100,000,
the total cost of the contract was close to $1 million. The Division
responded that these contracts would be covered.
Another situation arises when the project is estimated at
over the threshold, but the bids come in under the threshold. If the project
bids are close to the threshold then in all likelihood one change order will
push the project over the top. It has been the policy of the Division to
apply the threshold requirements of Section 31-53(g) retroactively in the
situation where a contractor bids a project and then subsequent change
orders bring the total cost of all work to be performed on the project over
the threshold amount. In this type of situation, the Division will look to
the contractor or subcontractor for reimbursement of wages at the prevailing
rate from the first day work was performed on the project. However, if the
contractor can demonstrate that he/she bid in good faith, but there was a
major factor - unknown at the time of the bid - which resulted in the change
order, the prevailing rate will not be applied retroactively, but from the
date of the discovered change in the project.
Scenario #3: The
contract requires purchase of equipment and installation.
An issue may arise as to the coverage of a project when it
requires purchases of supplies and installation, as well as construction
components. For example, a contract which meets the threshold otherwise may
involve an alteration to update a computer system and the substantial
portion of the funds is for supplies and installation. Again, the
Division looks to the Federal Davis-Bacon Act for guidance. Specifically, in
the Field Operation Handbook for the U.S. Department of Labor, Section 15 d
10 discusses the criteria for determinations:
performed in conjunction with supply or service (e.g., base support)
contracts is covered by the DBRA where it involves more than an
incidental amount of construction activity (i.e., the contract contains
specific requirements for substantial amounts of construction,
reconstruction, alteration, or repair work, and such work is physically
or functionally separate from the contract (see Reg. 4.116(c)(2)). For
example, D-B coverage has been extended to installing a security system
or an intrusion detection system, installing permanent shelving which is
attached to a structure, installing air-conditioning ducts, excavating
outside cable trenches and laying cable, installing heavy generators,
grounding systems, where a substantial amount of construction work is
work involves more than an incidental amount of construction activity
depends upon the special circumstances of each particular case and no
fixed rules can be established which would accommodate the facts of
every situation. Factors requiring consideration include the nature of
the prime contract work, the type of work performed by the employees
installing the equipment on the project site (i.e., the techniques,
materials, and equipment used and the skills called for in its
performance), the extent to which structural modifications to buildings
are needed and the cost of the installation work -- either in terms of
absolute amount or in relation to the cost of the equipment and the
total project cost.
The above handbook sections are consistent with federal case
law and administrative Wage Appeal Board cases. Obviously, these are fact
specific cases and each situation has to be judged based on the particulars
of each project. This issue has only recently been raised with respect to a
large project involving the installation of a telecommunications system for
an office building leased by the State. This project must be evaluated based
upon the above criteria.
Scenario #4: The State
or political subdivision has entered into a lease agreement.
Questions may also arise as to coverage when the State or political
subdivision leases property where construction or renovation is involved.
The Division has recently concluded that there is no requirement that the
State or political subdivision be the holder of title to the property
subject to construction, renovation, addition or alteration as a
prerequisite to coverage under Section 31-53. Like the Davis-Bacon Act,
Connecticut's law does not specifically address such situations; however,
the Courts have upheld the U.S. Department of Labor's practice of applying
Davis-Bacon rates to projects where the property is leased not owned by the
"The Court finds that it is reasonable to conclude, as the
Wage Appeals Board has done, that the nature of the contract is not
controlling so long as construction work is part of it." Building and
Construction Trades Department, AFL-CIO, et al., v. Turnge Civ. A. No.
87-2827. U.S. Dist. Court, District of Columbia.
The Field Operations
Handbook Sec. 15b06 also addresses lease situations:
the Government enters into a lease/purchase agreement D-B applies, because
the cost of the construction is eventually paid for by the Government. D-B
also applies to a lease option or to a term lease agreement where there is
substantial and segregable construction activity, and where the structure is
a public building or public work. This may be true, for example, where the
building is built at the request of the Government pursuant to Government
specifications for Government use or purpose for the period of the lease.
Recently, we have seen quite a few lease projects where title is not held
with the State, but the construction is clearly authorized and paid for by
the State. In this type of situation, there should be a contract which
describes the construction work or renovations to be performed. Even if the
contract is called a "lease agreement" and even if it is between the State
and the owner of the property who eventually subcontracts the actual
construction, it is work carried on by the authority of the State or with
funds of the State and is thus subject to the mandates of Section 31-53.
lease arrangements, it is necessary to confirm that the contract (or lease
agreement) contains provisions regarding the construction or renovation,
alteration or repair required or authorized by the State or political
subdivision. If it can be shown that the construction is not required by the
State or political subdivision before it will enter into or continue in a
lease agreement, the mere increase in lease payments which reflects the
owner passing along a portion of his cost in the improvements would not
render the agreement subject to Section 31-53.
Our experience has shown that during economic times where
private construction is minimal there is tremendous competition to win
government contracts. It is also during this time that there is increased
pressure on contracting agencies to lower the cost of projects. However,
without regard to the various arguments surrounding the impact of prevailing
wage on the cost of construction, it is important for the Labor Department
to stay the course despite market fluctuation. Over the years, this has been
done to the benefit of contractors, workers, and agencies who need to know
there is consistency in maintaining a "level playing field".
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Coverage When Bid Under
In response to the
question regarding this agency's interpretation of the applicability of
Connecticut General Statutes Section 31-53 to projects which are bid under
$100,000, but through change orders subsequently meet the threshold
requirement of Connecticut General Statutes Section 31-53(g).
Connecticut General Statutes Section 31-53(g) states:
provisions of this section shall not apply where the total
cost of all work to be performed by all contractors and
subcontractors in connection with new construction of any
public works project is less than four hundred thousand dollars
or where the total cost of all work to be performed by all
contractors and subcontractors in connection with any
remodeling, refinishing, refurbishing, rehabilitation,
alteration or repair of any public works project is less than
one hundred thousand dollars.
It has been the
policy of the Wage & Workplace Standards Division, the enforcement unit
for the prevailing wage law, to apply the threshold requirements of
Connecticut General Statutes Section 31-53(g), retroactively in the
situation where a contractor bids a project and then subsequent change
orders bring the total cost of all work to be performed on the project
over the threshold amount ($100,000 alteration, rehabilitation,
renovation or $400,000 new construction). In this type of situation the
Division will look to the contractor or subcontractor for reimbursement
of wages at the prevailing rate from the first day work was performed on
The language of this section must be read consistent with
the intent of the legislation in ensuring that mechanics, laborers or
workers employed on substantial public works projects be paid the
prevailing rate of pay. This is the only practical interpretation to be
given to this provision to avoid the purposeful underbidding of
contracts to avoid compliance with the statute. However, if the
contractor can demonstrate that he/she bid in good faith, and there was
a major factor - unknown at the time of the bid - which resulted in the
change order, the prevailing rate will not be applied retroactively, but
from the date of the discovered change in the project.
not look to the contracting agency to pay the difference in rate. From
our perspective, it is the statutory responsibility of the contractor/
subcontractor to ensure that prevailing rates are paid to the
workers on the job. It may be necessary for the Contracting Agency to
confer with their attorney regarding your agency's contractual
obligation to pay the contractor or subcontractor the reimbursement for
the prevailing wages in this type of situation.
matter of policy, we suggest for projects which come close to prevailing
rate thresholds, that prevailing rates be made a term in the contracts.
This would serve the dual purpose of protecting the agency from
potential contractual liability when the inevitable change orders start
to appear and also would prevent the purposeful underbidding of
contracts on public works projects.