Anna Baluch is a freelance writer from Cleveland, Ohio. She enjoys writing about a variety of health and personal finance topics. When she's away from her laptop, she can be found working out, trying new restaurants, and spending time with her family.
Anna Baluch ContributorAnna Baluch is a freelance writer from Cleveland, Ohio. She enjoys writing about a variety of health and personal finance topics. When she's away from her laptop, she can be found working out, trying new restaurants, and spending time with her family.
Written By Anna Baluch ContributorAnna Baluch is a freelance writer from Cleveland, Ohio. She enjoys writing about a variety of health and personal finance topics. When she's away from her laptop, she can be found working out, trying new restaurants, and spending time with her family.
Anna Baluch ContributorAnna Baluch is a freelance writer from Cleveland, Ohio. She enjoys writing about a variety of health and personal finance topics. When she's away from her laptop, she can be found working out, trying new restaurants, and spending time with her family.
ContributorCassie is a deputy editor collaborating with teams around the world while living in the beautiful hills of Kentucky. Focusing on bringing growth to small businesses, she is passionate about economic development and has held positions on the boards of.
Cassie is a deputy editor collaborating with teams around the world while living in the beautiful hills of Kentucky. Focusing on bringing growth to small businesses, she is passionate about economic development and has held positions on the boards of.
Written ByCassie is a deputy editor collaborating with teams around the world while living in the beautiful hills of Kentucky. Focusing on bringing growth to small businesses, she is passionate about economic development and has held positions on the boards of.
Cassie is a deputy editor collaborating with teams around the world while living in the beautiful hills of Kentucky. Focusing on bringing growth to small businesses, she is passionate about economic development and has held positions on the boards of.
Jane Haskins, J.D. contributorJane Haskins practiced law for 20 years, representing small businesses in startup, dissolution, business transactions and litigation. She has written hundreds of articles on legal, intellectual property and tax issues affecting small businesses.
Jane Haskins, J.D. contributorJane Haskins practiced law for 20 years, representing small businesses in startup, dissolution, business transactions and litigation. She has written hundreds of articles on legal, intellectual property and tax issues affecting small businesses.
Jane Haskins, J.D. contributorJane Haskins practiced law for 20 years, representing small businesses in startup, dissolution, business transactions and litigation. She has written hundreds of articles on legal, intellectual property and tax issues affecting small businesses.
Jane Haskins, J.D. contributorJane Haskins practiced law for 20 years, representing small businesses in startup, dissolution, business transactions and litigation. She has written hundreds of articles on legal, intellectual property and tax issues affecting small businesses.
Updated: Apr 17, 2024, 11:52am
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Government-funded jobs can be lucrative and exciting. But if you land one as a contractor or subcontractor, you may be required to submit certified payroll records. To avoid serious penalties for noncompliance, it’s a good idea to familiarize yourself with what certified payroll is and how it works. In this handy guide, we’ll help you do just that.
Certified payroll is a special weekly payroll report used by contractors who are working on federally funded projects. To meet your certified payroll requirements, you’ll need to submit Form WH-347 to the Department of Labor every week. This form includes details about your employees, their wages and benefits, the type of work they performed and the total number of hours they work.
There is also a statement of compliance that states your attached payroll report is accurate and complete. The goal of WH-347 is to ensure you’re paying your employees the prevailing wage or the average wage for employees in a specific occupation. It shows that your business is complying with all prevailing wage requirements.
Certified payroll comes from the Davis-Bacon Act, which was passed by Congress in 1931 to protect workers from low hourly wages. Per the Davis-Bacon Act, if the government gives your business a contract for over $2,000 to complete construction, alteration or repair of public buildings or public works projects, you must comply with certified payroll.
Since the Davis-Bacon Act has been enacted, other acts have been passed to enforce prevailing wage laws. Several examples of these acts include the Housing and Community Development Act of 1974, Federal-Aid Highway Acts and the Federal Water Pollution Control Act.
Prevailing wage laws were created to ensure fair pay to hourly workers. To meet these laws, your employees’ gross wages must adhere to the prevailing wage requirements for work on related projects in surrounding areas. Fringe benefits, such as health insurance and retirement plans, must also meet these requirements.
To determine prevailing wages, the Department of Labor conducts surveys to determine the average wage paid to workers in a specific occupation in a particular area. States with higher average construction wages will have a higher prevailing wage. To find out your wage determination, reach out to the Department of Labor.
Certified payroll is mandatory for contractors and subcontractors who work on various types of federally funded construction contracts that are over $2,000. This may be anything from building a school or repairing a highway. While the term “construction” is broad, it can apply to a variety of activities such as painting, decorating, cleaning, plumbing, drywall and electrical.
At first glance, Form WH-347 can seem overwhelming. To make it easier to understand, here’s a breakdown of each section you’ll need to fill out.
Next, you’ll share detailed information about each employee, including:
While complying with certified payroll takes time and effort, it’s essential if you’d like to avoid serious consequences. The penalties for violating Davis-Bacon laws include:
If you’re new to certified payroll reports or don’t have an experienced professional to guide you, errors can occur. Here are some of the most common mistakes you should be mindful of and do your best to avoid.
There’s no denying that filling out and submitting certified payroll reports each week can be a daunting and time-consuming endeavor. The good news is there are several ways you can simplify the process and ensure compliance.
While you can try to tackle certified payroll reports on your own, it might make sense to enlist the help of a certified payroll specialist. A certified payroll specialist has passed the Certified Payroll Professional (CPP) exam and been accredited by the American Payroll Association (APA). They have the knowledge and experience to handle all types of payroll processes, including certified payroll.
Your payroll data will change every time you add employees, lose employees or give pay raises. By taking the time to create a procedure manual that documents your certified payroll process, you can easily train new team members. A well-written manual can mean the difference between processing your payroll efficiently without errors and facing penalties for noncompliance.
The days of managing payroll on spreadsheets are long gone. To make your life easier, reduce the risk of mistakes and ensure you never lose important data, use an automated payroll solution. Even though you will have to invest in it, it will speed up your process and increase accuracy.
According to the Fair Labor Standards Act (FLSA), you must keep payroll records for at least three years. These include personal employee information, hours worked, pay rate, regular and overtime hours worked, additions to and deductions from pay, total wages per pay period and the dates of payment. Ideally, you’d store your records digitally so they never get lost.
Certified payroll should be on your radar if your business takes on federal construction contracts. To simplify the process and save time, don’t be afraid to ask for help. By doing so, you can rescue your risk of penalties and focus on running and growing your business.
