Are prevailing wages owed if the money comes from an insurance claim?

1 week ago

Hello,

Are prevailing wages owed if the funds to complete repairs originate from an insurance claim?

Thank you,
Blake Mears

Senior Legal Associate Levelset

If a public agency initiated a public works project which was to be paid with insurance proceeds, it’s entirely possible that prevailing wages might be required. While the source of funds does come into play, project ownership is still a major component (if not the most important one) in determining whether prevailing wages will be required.

In Illinois, prevailing wages are required for “public works”, and “public works” are defined (at 820 ILCS 130/2) as “…all fixed works constructed or demolished by any public body, or paid for wholly or in part out of public funds.” So, even if a construction project for a public body doesn’t necessarily use public funds, the project may still be considered a “public work”.

Of course, for ultimate clarity, it might be helpful to reach out to your customer. And, if they’re unsure, consulting with a local construction attorney or other Illinois prevailing wage expert may be helpful.

For more on Illinois prevailing wage basics: Prevailing Wage Illinois: The Basics, Obligations, and Violations.

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