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Safe Harbor Protection and Best Practices

California has a “Safe Harbor” protection which allows prime contractors to gain some protection against penalties when a subcontractor does not comply with all the rules (and in California there are a lot of rules). A contractor can walk away from the following types of penalties imposed on their subcontractors if they comply with the four Safe Harbor requirements:

• Wage penalties
• Overtime penalties
• Apprenticeship penalties 
• Penalties imposed because of Skilled and Trained Workforce. 

Remember a prime contractor is still liable for wages due to workers of subcontractors and a contractor will still be fined if they have a subcontractor on the project which does not have a current DIR public works contractor registration .

The four requirements of Safe Harbor include:

• Including very specific sections of the California Labor Code in the subcontract. No abbreviations or incorporating by reference.
• Collection and review of certified payrolls for the project.
• If Violations are found, then withholding appropriate payment.
• Having the subcontractor complete an End of Project Affidavit.

Best Practices: Even if you are not in California, informing your subcontractor of applicable prevailing wage rules is always good. Collecting and reviewing CPRs keeps your project on track and ahead of state of federal entities that may audit and impose financial penalties. Finally, having an End of the Project Affidavit is a nice way to complete your labor compliance on any project.

Training Opportunities

August 18^th in person training -6 hours What Every Contractor Should Know About Prevailing Wage sponsored by ABC Southern California. For more information or to register, go to:  jthomas@abcsocal.net

August 25^th in person training – 1:30-3:00 p.m. Creating Your Own Prevailing Wage Checklist California Special District Association Annual Conference Palm Dessert. For more information, contact www.csda.net

Aug 28^th ABC San Diego What Every Contractor Should Know About Prevailing Wage all day in person workshop. For more information, go to: www.abcsd.org

October 2^nd in person training – 6 hours Everything You Should Know About Prevailing Wages sponsored by Humboldt Builders Exchange. For more information or to register, contact info@humbx.com

If you need more training, Deborah Wilder is the presenter on the LCPtracker Academy Prevailing wage workshops. Go to www.LCPtracker.com and select the education tab.

Want to schedule your own prevailing wage workshop?

We will customize a workshop or webinar for you and your Agency/Account. Contact us at: info@ccmilcp.com 

ANSWER: 

The Federal Davis Bacon Act clarified in October 2023 that professional services, which involve the physical work on the project, will trigger federal Davis Bacon prevailing wage obligations. This includes surveying tasks like staking and material testing (such as obtaining core samples).

Each State and jurisdiction is different. For the most part no one considers the following to be subject to prevailing wage requirements: SWPPP, Archeological oversite on a project, or certain environmental testing such as the counting of animals; and most exclude taking of water samples for testing.