What a Public Entity Needs To Know

The New Jersey Prevailing Wage Act (N.J.S.A. 34:11-56.25 et seq.) establishes a prevailing wage level for workers engaged in public works in order to safeguard the workers efficiency and general well-being, and to protect them as well as their employers from the effects of serious and unfair competition resulting from wage levels that are detrimental to the efficiency and well-being of all concerned.

The Act requires the payment of minimum rates of pay to laborers, craftsmen and apprentices employed on public works projects. Covered workers must receive the appropriate craft prevailing wage rate as determined by the Commissioner of Labor. Prevailing wage rates are wage rates based on the collective bargaining agreements established for a particular craft or trade in the locality in which the public work is performed. In New Jersey, these rates vary by county and by the type of work performed.

Public works projects subject to the Act are those funded in whole or in part with the funds of a public body. Contracts awarded directly by municipal government must be valued at $10,743 or more to be covered by the Act. For all other public entities, including municipal utility authorities and boards of education, the threshold is $2,000.

Anyone interested in bidding on or engaging in any contract (or part thereof) for public work which is subject to the provisions of the Prevailing Wage Act must register with the Division of Wage and Hour Compliance as required by the Public Works Contractor Registration Act (PWCRA) P.L. 1999, c.238-N.J.S.A. 34:11-56.48 et seq. which establishes a unified procedure for the registration of contractors and subcontractors engaged in public works building projects. The PWCRA requires an annual registration fee of $300. After successful completion of two consecutive years of registration, a contractor may elect to register for a two year period and pay a registration fee of $500.

Upon registration, the contractor and/or subcontractor will be issued a certificate indicating compliance with the requirements of the Act. Public bodies are expected to require proof of registration of all contractors bidding on the project and all subcontractors identified in such bids.

DEFINITION OF PUBLIC CONTRACTS WORK
Public work means any construction, reconstruction, demolition, alteration or repair work, or maintenance work including painting and decorating, done under contract and paid for in whole or in part out of the funds of the public body, except work performed under a rehabilitation program. Public work also means construction, reconstruction, demolition, alteration, or repair work done on any property or premises, whether or not the work is paid from public funds, if at the time of entering into the contract:

1. Not less than 55% of the property or premises is leased by a public body, or is subject to an agreement to be subsequently leased by the public body; and
2. The portion of the property or premises that is leased or subject to an agreement to be subsequently leased by the public body measures more than 20,000 square feet.

The Division of Wage and Hour Compliance Public Contracts Section regulates the payment of prevailing wage rates on public work projects through:

1. the distribution of a prevailing wage rate determination for each trade, craft and classification;
2. the routine site inspections of public construction projects;
3. the implementation of fines and penalties to offenders; and
4. the debarment from bidding and working on public works projects for three years for those contractors determined to be serious offenders.

The Act and regulations requires every contractor or sub-contractor performing public work for a public body to maintain the following records:

1. the name, address, social security number, craft or trade of each worker, and;
2. the actual hourly rate of pay, actual daily, overtime and weekly hours worked in each craft or trade, gross pay, itemized deductions, and net pay paid to the employee; such record shall also include:
a. any fringe benefits paid to approved plans, funds or programs on behalf of the employee; and
b . fringe benefits paid in cash to the employee.

These records must be preserved for a two year period from the date of payment and shall be open at all reasonable hours to the public body awarding the contract, to any other party to the lease or agreement to lease pursuant to which the public work is done and to the Commissioner of Labor.