Proactive vs. Reactive
Specific vs. General
Important vs. Urgent
Successful Prevailing Wage contractors are most often ones that take a proactive mindset. They specifically address wages and benefits, how they are earned, paid, and credited. In addition, they address in detail how employee time, work, and pay is classified. Specifics include who does what, when, where, and even how.
Why be specific?
Very simply because Prevailing Wage law requires it. Every hour worked on a Prevailing Wage project is reported via Certified Payroll, gross wages included. Most Prevailing Wage projects require the submission of Certified Payroll Reports weekly, where the Contractor certifies that employees listed worked the hours stated, at the classification stated, were paid the wages required and received the proper amount of bona fide fringes per the applicable wage determination. The report is signed under penalty of perjury that all of the information being provided is true and accurate.
Why aren’t more contractors proactive?
Because it’s not the fire burning hottest, there are only so many hours in a day and the motivation hasn’t properly presented itself. For instance, one isn’t quite so willing to speed through a construction zone after paying a $400 ticket. We allow “Urgent” to often times take the place of “Important”. There are new problems every day: employees, where’s my money, jobs to bid, weather, and one’s plate is only so big. Prevailing Wage issues may not appear urgent, but that can change quickly when a DOL Investigator walks in the door.
What are some ways Prevailing Wage can be addressed proactively?
A Proactive Contractor knows proper worker classification is always a struggle. The construction contractor must ensure procedures and processes are in place to minimize misclassification opportunities. A Reactive Contractor hopes workers are being classified correctly.
A Proactive Contractor takes maximum allowable credit on Prevailing Wage projects. The contractor has a solid understanding of employee insurance premiums, paid time off, pension plans, and how these fringes affect the quality of employees the company attracts and retains. He knows the steps required to take Prevailing Wage credit for Holiday and Vacation Pay and for company sponsored Apprenticeship training. A Reactive Contractor pays the Prevailing Wage Required Fringe as cash wages or makes only a pension plan contribution because he doesn’t know what else to do.
Because of a consistent and persistent approach, a Proactive Contractor knows his company is in compliance with applicable Prevailing Wage statutes and regulations. Proactive = “Here is what we do.” The Reactive Contractor hopes his company is in compliance. Reactive = “What will you let me have?”
It’s easy to be in compliance if you don’t care how much money you spend. The proactive approach is the only way to be in compliance and cost competitive.
What is the best way to fix a problem? Don’t have it.