Statements and Payrolls

The LG is responsible for receiving and paying statements from the contractor during construction and for ensuring workers are being paid fairly by both the contractor and subcontractors. The
LGPM Guide
provides a description of the sections related to payrolls on
Form FHWA-1273
.
29 CFR Part 5
and
23 U.S.C. §113
require the LG to meet the federal regulations for ensuring the contractor and subcontractors are paying the prevailing wage. For purposes of this guide, the LG is considered the “contracting agency.” The LG is required to ensure:
  • a representative sampling of employees is interviewed to verify contractor and subcontractor compliance; and
  • contractor and subcontractor payroll records are reviewed on a sampling basis.
The regulation does not require 100 percent coverage; it requires coverage frequency “... as may be necessary to assure compliance.” All contractors and subcontractors on the project must be included in the spot check. Contractors or subcontractors with violations must be reviewed in more detail.
Federal Requirement
  1. 29 U.S.C. §§201-219
    – The Fair Labor Standards Act addresses various requirements applicable to employees including minimum wages, maximum hours and various child labor provisions.
  2. 23 U.S.C. §113
    – Requires the Secretary of Transportation to take all steps necessary to assure laborers and mechanics working on federally funded projects are paid no less than the prevailing wage for similar work.
  3. 40 U.S.C. §3141 et seq
    . – Requires the Secretary of Labor to implement regulations including a provision that each contractor and subcontractor shall furnish a weekly statement with respect to the wages paid each employee during the preceding week.
  4. 29 CFR §§3.1
    and
    3.3
    – Requires contractors and subcontractors to submit weekly statements of wages paid on work covered by Davis-Bacon.
  5. 29 CFR §5.6(a)(3)
    – Requires recipients of federal funds to conduct investigations at a frequency necessary to assure compliance. The investigations must include employee interviews and examination of payroll data.
  6. 23 CFR §635.118
    – Requires the state transportation department (TxDOT) to retain copies of payrolls and statements of wages paid, filed with the state as set forth in the required contract provisions for the project, for the time period pursuant to
    2 CFR §200.333
    (3 years) for review as needed by FHWA, the Department of Labor, the General Accounting Office or other agencies.
  7. 23 CFR §636.119(c)
    – Requires design-build projects to conform to all non-procurement requirements, including Davis-Bacon.
  8. Form FHWA-1273
    :
    1. Section IV.3 requires weekly, certified payroll submissions by the contractor and subcontractors; and
    2. Section IV.5 incorporates the Department of Labor regulations in the Copeland Act (anti-kickback provisions).
State Requirement
  1. Texas Government Code §2258.024
    – Describes records to be kept by the contractor and subcontractor concerning minimum wages paid. The records must be made available to inspection by the contracting entity.
  2. Texas Government Code §2258.026
    – Allows a contractor to accept a certification from a subcontractor in lieu of actual records.
  3. Texas Government Code §2258.051
    – Requires the public entity to investigate complaints and withhold payment for violations.
Required Practices
The
LGPM Guide
provides the required practices and responsibilities that must be followed in order to ensure compliance with wage rates.