Prevailing Wage & Labor Compliance FAQ

Question 1

Do you handle both California DIR and Davis-Bacon?

Accepted Answer

Yes. We manage both California DIR eCPR portal submissions and federal Davis-Bacon certified payroll requirements. Our team is experienced with multi-jurisdictional projects that require compliance with both state and federal prevailing wage laws simultaneously.

Question 2

Will we have a backup analyst?

Accepted Answer

Absolutely. Every client engagement is staffed with a primary analyst and a designated backup. This ensures continuity of service during vacations, illness, or high-volume periods — your deadlines are never at risk due to staffing gaps.

Question 3

What types of projects do you support?

Accepted Answer

We support public works, federally funded infrastructure, affordable housing, solar and clean energy, and HUD-assisted projects. Our team handles compliance for general contractors, subcontractors, developers, and awarding bodies across California and nationally.

Question 4

How quickly can you onboard a new project?

Accepted Answer

Most projects are onboarded within 3–5 business days. We review your contract documents, funding sources, and applicable wage determinations, then set up your compliance tracking system and contractor onboarding workflow before the first certified payroll is due.

Question 5

Do you work with subcontractors, or only general contractors?

Accepted Answer

We work with all tiers — awarding bodies, prime contractors, subcontractors, and developers. Subcontractors often need the most support with weekly CPR preparation, fringe benefit calculations, and audit response. We offer flexible engagement models from full-service compliance management to targeted support for specific reporting obligations.

Question 6

Does the IRA require prevailing wages on all solar projects?

Accepted Answer

The IRA's prevailing wage requirement applies to projects that begin construction after January 29, 2023 and claim the full 30% Investment Tax Credit (or other enhanced IRA credits). Projects under 1 MW of output are exempt. All others must pay Davis-Bacon prevailing wages and maintain certified payroll records for the duration of construction and, in some cases, for 10 years of operation.

Question 7

What are the apprenticeship requirements under the IRA?

Accepted Answer

The IRA requires that a minimum percentage of total labor hours on qualifying projects be performed by registered apprentices — starting at 10% for projects beginning construction in 2023, rising to 12.5% in 2024, and 15% thereafter. The requirement applies to each trade and occupation, and contractors must make a good-faith effort to hire apprentices from registered programs.

Question 8

What happens if we don't comply with IRA prevailing wage rules?

Accepted Answer

Non-compliance can reduce your Investment Tax Credit from 30% to 6% — a significant financial penalty. The IRS also imposes correction payments (back wages plus interest) and penalties of $5,000 per worker per year for willful violations. Proper documentation from day one is the best protection.

Question 9

Do California solar projects have additional requirements beyond federal rules?

Accepted Answer

Yes. California public works solar projects must comply with DIR prevailing wage requirements, which are separate from and often higher than federal Davis-Bacon rates. Contractors must register with the DIR, submit certified payrolls via the eCPR system, and meet California's apprenticeship utilization requirements — which differ from the federal IRA thresholds.

Question 10

Can you manage compliance for our subcontractors too?

Accepted Answer

Absolutely. We monitor certified payroll submissions for all tiers of subcontractors on your project, issue cure notices for deficiencies, and maintain a complete compliance file for every sub. This is especially important under the IRA, where the prime contractor is responsible for subcontractor compliance.

Question 11

What is the DIR public works registration requirement under SB 854?

Accepted Answer

Senate Bill 854, effective June 2014, requires all contractors and subcontractors to register with the California DIR's Public Works Contractor Registration program before bidding on or performing work on any public works project in California. Registration must be renewed annually. Awarding bodies are prohibited from accepting bids from unregistered contractors, and prime contractors are responsible for ensuring all their subcontractors are registered.

Question 12

How does eCPR work and who must submit?

Accepted Answer

The DIR's Electronic Certified Payroll Reporting (eCPR) system requires contractors and subcontractors to submit weekly certified payroll records online for every worker on a public works project. Submissions must include the worker's name, address, Social Security number (last four digits), classification, hours worked, wage rate, fringe benefits, and apprenticeship status. Records must be submitted within the timeframes specified in the contract and are subject to DLSE audit.

Question 13

Are California prevailing wage rates different from federal Davis-Bacon rates?

Accepted Answer

Yes — California prevailing wage rates are set independently by the DIR and are typically higher than federal Davis-Bacon rates. California rates are updated twice yearly (February and August) and vary by county, craft, and classification. On projects subject to both California and federal requirements, contractors must pay the higher of the two rates for each classification.

Question 14

What are California's apprenticeship requirements for public works?

Accepted Answer

California Labor Code Section 1777.5 requires contractors on public works projects to employ registered apprentices from DAS-approved programs. The required ratio is generally one apprentice for every five journeymen in each apprenticeable craft. Contractors must request apprentices from applicable apprenticeship committees at least 72 hours before work begins. Failure to comply results in civil penalties and forfeiture of apprenticeship training fund contributions.

Question 15

Does California DIR compliance apply to federally funded projects?

Accepted Answer

Yes. California public works projects that receive federal funding are subject to both California DIR requirements and federal Davis-Bacon requirements. Contractors must comply with both sets of rules simultaneously — paying the higher of the two prevailing wage rates, submitting certified payrolls to both the DIR (via eCPR) and the federal contracting agency, and meeting both California and federal apprenticeship requirements.

Question 16

What triggers a DLSE investigation?

Accepted Answer

The DLSE investigates prevailing wage complaints filed by workers, unions, or awarding bodies, as well as conducting random audits of certified payroll records. Common triggers include worker complaints about underpayment, discrepancies in eCPR submissions, failure to register with the DIR, and referrals from awarding bodies. The DLSE has broad authority to inspect payroll records, interview workers, and issue civil wage and penalty assessments.

Question 17

Does Davis-Bacon apply to all affordable housing projects?

Accepted Answer

Davis-Bacon and Related Acts (DBRA) apply when federal funding is involved — including HUD grants, HOME funds, CDBG, and projects with 12 or more units assisted under certain HUD programs. LIHTC projects may also trigger prevailing wage requirements depending on state law and the presence of other federal assistance. We assess each project's funding sources to determine the exact applicable mandates.

Question 18

What is Section 3 compliance and who does it apply to?

Accepted Answer

Section 3 of the Housing and Urban Development Act requires that HUD-funded projects provide employment and contracting opportunities to low- and very low-income persons, particularly public housing residents. It applies to recipients of HUD financial assistance for housing and community development projects above certain thresholds. We prepare Section 3 hiring plans, track resident hiring, and compile the required documentation for HUD reporting.

Question 19

What are the California DIR requirements for affordable housing contractors?

Accepted Answer

California public works contractors and subcontractors must register with the DIR, submit certified payroll records electronically via eCPR, comply with prevailing wage rates set by the DLSE, and meet apprenticeship ratio requirements enforced by the California Apprenticeship Council. Penalties under Labor Code § 1775 can reach $200 per worker per day for willful violations. We handle registration, eCPR submission, and ongoing compliance monitoring.

Question 20

How can non-compliance affect LIHTC tax credit allocations?

Accepted Answer

State housing finance agencies and the IRS can suspend or recapture LIHTC allocations when labor compliance documentation is incomplete, inaccurate, or missing. Developers risk losing years of tax credit equity if certified payroll records don't support the prevailing wage certifications required at project closeout. Our documentation management ensures your compliance package is complete and defensible.

FAQ & Compliance Glossary

Common compliance questions

Labor compliance glossary

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