Home>Levelset Community>Legal Help>If a contractor is delinquent with providing certified payroll reports, can payment be withheld on a public project?

If a contractor is delinquent with providing certified payroll reports, can payment be withheld on a public project?

California

A subcontractor has not files certified payroll reports as the owner of the project has specified in its specs. The owner has paid the general contractor. The subcontractor has been notified that certified payroll is missing and needed in order to get paid. The subcontractor is now threatening to file per the prompt payment act in California.

1 reply

Aug 18, 2020

Certified payroll reports are required to be used on almost every federal and state public construction project that are subject to prevailing wage laws. These requirements are imposed by the federal Davis-Bacon Act, and the respective state “mini Davis-Bacon Acts.” In order for a project to be deemed a prevailing wage job, it must be a public works project and exceed certain contract thresholds. For state level jobs, the contract minimum threshold can range anywhere from $1000 in California. If working on these jobs, contractors are required to pay the minimum prevailing wage of that are and type of work. This is regulated through the submission of certified payroll reports. Each state has different reporting requirements, but the standard timeframe is once a month, as progress payments are typically made monthly. However, read your contract carefully, the terms may require submissions more frequently. Certified payroll records that are submitted late, can slow payment down on the entire project, and could result in interest penalties or termination of the contract. This post is likely to be helpful in regards to understanding California Prevailing Wage Requirements and Rules. The California Prompt Payment Act for Public Projects states that State & Local Agencies must pay progress payments within 30 days after receiving a request. However, due to the subcontractor's missing certified payroll report, the subcontractors payments is likely to be delayed due to slowing down the project.

1 person found this helpful

Helpful