Prevailing Wage Rates

Definition

Prevailing Wage Rates are wages set by federal and state governments for construction work based on wages paid for similar work in the same local area. These include the hourly wage, usual benefits, and overtime paid to the majority of workers, laborers, and mechanics.

Purpose

Prevailing Wage Rates ensure fair compensation for workers on public construction projects by reflecting local wage standards, preventing wage undercutting, and promoting equitable labor practices.

Examples of Use

• Public Works Projects: Applying prevailing wage rates to workers on infrastructure and building projects funded by government entities.
• Union Jobs: Reflecting union-negotiated wages in prevailing wage calculations.
• Government Contracts: Requiring compliance with prevailing wage rates in contracts for federal, state, or municipal construction projects.

Related Terms

• Prevailing Wage Law: The legislation that mandates the establishment and enforcement of prevailing wage rates.
• Davis-Bacon Act: A federal law that requires payment of prevailing wage rates on public works projects.
• Labor Standards: Regulations governing wages, working conditions, and benefits for workers.

Notes

• Adjustment: Prevailing wage rates may be adjusted periodically to reflect changes in local wage conditions and economic factors.
• Documentation: Contractors must maintain accurate payroll records to demonstrate compliance with prevailing wage requirements.