California Prevailing Wage
California’s Prevailing Wage Law has been around since the 1930s but has significantly expanded in recent years, making California’s prevailing wage requirements some of the most expansive and comprehensive in the country. As a result, workers are entitled to be paid prevailing wages on essentially any construction project paid for with public funds (including certain private construction projects) in California. These wage requirements can massively increase wages owed to workers — and claims may be brought years after the work is complete.
The most common prevailing wage violations on public works projects are:
- Failing to pay workers at the correct rate for their trade classification
- Failing to provide workers fringe benefits or payment in lieu thereof
- Failing to pay workers for all hours worked on the public works projects
- Demanding that workers pay wages back to their employer (i.e., kickbacks)
What are the Prevailing Wage Requirements in California?
California Labor Code requires that all workers employed on “public works” be paid not less than the general prevailing rate of per diem wages applicable to the trade or craft of the work that they perform. This is true whether the worker is employed by a contractor or subcontractor in performing the work required by a contract for public work.
“Public works” is defined in the Labor Code to include all construction, alteration, demolition, installation, maintenance, or repair work done under contract paid for in whole or in part out of public funds. This can also include pre-construction and post-construction activities related to a public works project.
All workers on public works projects over $1,000 must be paid prevailing wages determined by the Director of the Department of Industrial Relations (DIR), according to the type of work and location (county) of the project. The DIR publishes the prevailing wage rate determinations on its website. For example, the following prevailing wage hourly rates apply to workers on public works projects in the San Francisco Bay Area, as of 2022:
- Tree Trimmer (High Voltage Line Clearance): $39.26 basic hourly rate, plus $20.70 in fringe benefits, for a total compensation of $59.96 per hour.
- Boilermaker-Blacksmith: $49.62 basic hourly rate, plus $42.01 in fringe benefits per hour, for a total compensation of $91.63 per hour.
- Iron Worker: $47.98 basic hourly rate, plus $34.46 in fringe benefits per hour, for a total compensation of $82.44 per hour.
The rates are usually based on the rates specified in union collective bargaining agreements applicable to the trade/classification of work. Please contact Pelton Graham to determine which prevailing wage rate should apply to the work you are performing on a public works project.
Frequently Asked Questions – California Prevailing Wage
How do I know if I am working on a public works project?
The best indicator is if you are working on a project directly for a city, county, municipality, district, public housing authority, or agency of the state of California. For example, projects in public schools, public hospitals, police/fire departments, county buildings, etc.
Another indication is that the prevailing wage determination may be posted at the jobsite.
If you are still unsure of whether you are working on a public works project, or if you have an unpaid prevailing wage claim, please call Pelton Graham for a confidential consultation.
How do I know what rate I am supposed to be paid for my work?
The applicable prevailing wage rate is determined based on the type of work you are performing on the project (i.e., the trade classification associated with your work) and the location of the project. Although certain trade classifications have the same rate throughout the state, most have different rates for different areas of the state, based on the county where the work is performed.
The prevailing wage determinations published by the DIR also dictate the effective date of the determination and the expiration date. If there are no predetermined changes to the wage rates, the date of the advertisement of bids for the project determines which rate is applicable to the work on that project.
Q1. How is the prevailing wage rate determined?
A1. The prevailing wage rate is the basic hourly rate paid on public works projects to a majority of workers engaged in a particular craft, classification or type of work within the locality and in the nearest labor market area (if a majority of such workers are paid at a single rate). If there is no single rate paid to a majority, then the single or modal rate being paid to the greater number of workers is prevailing.
Q2. How does the prevailing wage affect me?
A2. California’s prevailing wage laws ensure that the ability to get a public works contract is not based on paying lower wage rates than a competitor. All bidders are required to use the same wage rates when bidding on a public works project. California law requires that not less than the general prevailing rate of per diem wages be paid to all workers employed on a public works project.