Where the rule comes from
Federal law requires prevailing wages on many federally funded construction projects. The Davis-Bacon Act is the best known federal law on the subject. Many states have their own laws for state and local projects. Some states have none. Coverage and thresholds differ, so do not assume.
How to tell if a job is covered
- The invitation to bid or the instructions to bidders say so.
- The Project Manual includes a wage determination with rates by trade.
- The supplementary conditions carry labor standards and payroll rules.
- The bid form asks you to acknowledge the wage requirement.
If the documents are silent on a public job, ask in writing before you bid.
What a wage determination shows
A wage determination lists worker classifications for an area. Each one has a base hourly rate and a fringe benefit rate. Your labor cost must meet the total for the classification that matches the work your crew does. The right classification is not always obvious for specialty work. Ask the agency if you are unsure.
What it changes in a bid
- Find the wage determination and its date in the documents.
- Match each worker on your crew to a classification.
- Price labor at the required rate and fringe, plus your payroll costs.
- Add office time for the payroll reports the job requires.
- Check the rules for apprentices and for lower tier subcontractors.
- Check the addenda. A new wage determination can be issued during bidding.
Paperwork and penalties
Covered jobs usually require certified payroll reports. Agencies can audit them. Underpayment can lead to back wages, penalties and loss of the right to bid public work. The details depend on the law that applies.
This article is general information, not legal advice. Check the bid documents and the labor agency in your state.
Takeoff Tool reads cover facts such as prevailing wage from the packet and shows the quote each came from.
Bid documents · Updated 11 Nov 2026