The Davis-Bacon Act established requirements for providing minimum base wages for different trade groups that work on public projects involving Federal funds - Municipal, State or Federal.

Each geographic region of a state has different wage scales for the various trades working on a project (i.e. carpenters, electricians, painters, roofers, wallboard, etc.). These "prevailing wages" are closely tied to union wages and are updated from time to time by the Federal government.

This, in itself is a very complicated issue to track; but added to the complication, the Davis-Bacon Act requires that a "fringe benefit amount" be paid in addition to the base wage for each employee within a given trade or class.  If an employer does not use this fringe money for benefits then it must be included in the employee's paycheck and therefore is subject to payroll taxes. If the money is used to purchase bona fide benefits, then it is never part of payroll and therefore not subject to Social Security Taxes, State and Federal Unemployment Taxes, Workers Compensation Premium or General Liability Premium. This complicated Act often requires the assistance of CPAs to determine that all wages and benefits are properly applied.

Turn to the GALLINA professionals to help you put programs in place to track your expenditures and to ensure you are in compliance with these laws. We can audit your prevailing wages and you will benefit from our trusted name behind your numbers.