Wages and Fringe Benefits

Cook Brown has extensive experience advising employer on compliance with fringe benefit obligations. The extend of such obligations can be exceedingly complex.

In California, the Director of the Department of Industrial Relations ("DIR") is responsible for determining the prevailing per diem rates of pay for all workers who work on state, local or special district public works projects. This responsibility has been delegated to the Division of Labor Statistics and Research ("DLSR"), its Chief and office staff, although the Director has the official "last word."

The Director is also under a statutory mandate to include amounts for fringe benefits as part of the prevailing rate of pay. The California prevailing wage, therefore, includes "employer payments" for payment of health and welfare, pension, holiday and vacation pay, and apprenticeship training along with travel pay, subsistence, and overtime pay. These components of the state prevailing wage are generally determined by reference to the collective bargaining agreements in the area where the public work is performed.

Under the Davis-Bacon Act, the Wage Determinations, contained in the contract specifications, list the classification, rate of pay, and a lump sum for "fringes." The determination is easy to understand and to read.