A Guide to Prevailing Wage in Massachusetts: Rules, Requirements, Rates, FAQs, and More for 2024

Need to know Massachusetts’s prevailing wages to keep your company and its workforce compliant? Our guide has everything to get started!

A prevailing wage is the minimum wage (with fringe benefits) all contractors, subcontractors, and employers working on state- or local-funded public works projects must pay their workers.

Contractors responsible for such projects are legally obligated to pay employees working similar occupations in the same locality a standard minimum rate.

Contractors, subcontractors, and employers must abide by these prevailing wage laws or suffer harsh legal consequences. Legalities aside, paying these prevailing wages also ensures a level playing ground for contractors and helps maintain the living standards of the affected workers.

Today’s guide investigates key details of Massachusetts’ prevailing wage laws. Here, you’ll learn the basics of these laws, how they are determined and enforced, and how to ensure compliance.

Understanding Prevailing Wage Laws in Massachusetts

Massachusetts was the fifth state to enact prevailing wage laws in 1911.

In Massachusetts, prevailing wages are determined on a project-to-project basis and usually run throughout the year except for projects spanning multiple years.

Besides public works projects, prevailing wage laws in Massachusetts also apply to hauling, waste and recycling disposal, school bus transportation, and certain housing authority jobs.

Prevailing wage matters in Massachusetts are handled by the Department of Labor Standards, as stipulated under G.L. c. 149, §§ 26 – 27, also known as The Prevailing Wage Law.

Under the Prevailing Wage Law, the hourly rates of apprentices, mechanics, laborers, teamsters, and chauffeurs in public works constructions shall be no less than those paid to other workers in similar trades in the same locality.

Prevailing wage also encompasses fringe benefits, such as the following:

Prevailing wage laws apply to all projects by public agencies, including local governments, universities, school districts, and public bodies.

The public agency that awards the contract is known as the “awarding authority.” The awarding authority must legally include current prevailing wage rates in its contracts and bid documents.

Like other states, Massachusetts has a minimum threshold for projects where prevailing wage laws apply. Only state- or locally-funded projects over $1,000 must pay the prevailing wage to qualifying workers.

Prevailing wage rates apply to the following public works under the Prevailing Wage Law (G.L. c. 149, §§ 26 – 27H, G.L. c 71, §7A, G.L. c 121B, §29B):

Any awarding authority seeking bids for a public project must first obtain the latest prevailing wage schedule from the Department of Labor Standards. This schedule contains the minimum hourly rate that contractors must pay to workers involved in the project.

Next, the DLS will furnish all contractors who bid for the project with a copy of the prevailing wage rate schedule. The DLS provides potential contractors copies of the prevailing wage rate for non-competitive bids. This schedule becomes a legally recognized part of the contract and project documentation.

Once the awarding authority grants the contract, the winning contractor must comply with the prevailing wage rates.

Prevailing wages apply to both unionized and non-unionized employees.

Aside from paying the required wage, contractors must also post the prevailing wage rates at a visible and accessible spot at the job site for all workers to see. In doing so, employees will know how much they should be paid for their work and report any violations. This includes overtime pay for all work exceeding 40 hours in a 168-hour work week.

Contractors must also submit weekly payroll report forms and compliance statements to the awarding authority.

Purpose and Goals of Prevailing Wages in Massachusetts

Kansas was the first state to adopt prevailing wages, which were bundled with laws addressing other labor issues in bills passed in 1891.

In 1931, the U.S. Congress passed the Davis Bacon Act, establishing a prevailing federal wage for federally funded projects. Its main purpose was to ensure fair compensation for workers in the construction industry, maintain their living standards, and prop up the economy.

Prevailing wages in Massachusetts serve various purposes and are critical for maintaining the state’s economy and infrastructure. The main reasons for prevailing wages in the Bay State include:

Protecting Local Workers

A prevailing wage prevents out-of-area contractors from undercutting local workers. Without a prevailing wage, contractors would bid lower quotes and bring in foreign workers who are likely to accept lower wages.

This law maintains a standard rate that ensures local workers receive fair compensation and can maintain their standard of living.

Workers will have enough money to support their families and play an active role in boosting the economy.

Ensures Fair Competition

Prevailing wage laws help maintain fair competition among contractors when bidding for state-funded projects.

By ensuring a standard pay rate, quotations become less of a consideration when awarding contracts. Instead, awarding authorities can focus on aspects like track record, competence, and similar merits.

Stimulates the Economy

Prevailing wage laws ensure blue-collar workers earn a decent salary, improving their quality of life.

By raising their wages, the state increases their spending power, which has a domino effect on the economy. This improves the business environment and encourages workmanship in the affected rates.

Attracting Skilled Talent

Higher wages attract brilliant, hard-working residents to pursue a craft. This leads to improved workmanship across the board, enhances productivity, and improves work quality, boosting the state’s infrastructure.

Skilled workers eventually become mentors and trainers that usher in the next generation of skilled laborers and so on.

Determining Prevailing Wages in Massachusetts

In Massachusetts, prevailing wages are determined through a process established by the state’s Division of Capital Asset Management and Maintenance (DCAMM) and the Department of Labor Standards (DLS).

The prevailing wage is the rate typically paid to workers in a particular locality, classification, and type of work.

The DLS will issue the required minimum rate plus fringe benefits for each public work construction project and other affected services. They’ll also issue the appropriate classifications for the affected trades.

The Attorney General’s Office enforces prevailing wage laws in the Bay State.

Determining prevailing wages is a comprehensive, all-inclusive process that includes consultations with various stakeholders and other interested parties. The process is as follows:

Classification and Locality

The first step in determining prevailing wages is to identify the specific classification of work and the geographic locality where the work will be performed.

Classifications typically refer to different trades or occupations, such as carpenters, electricians, plumbers, etc.

Survey and Data Collection

DCAMM and DLS collect data through surveys and other means to determine the prevailing wage rates for various work classifications in different geographic areas (counties) within the state.

This data collection process involves gathering information on wages paid by contractors and subcontractors who perform similar types of work in the area.

Analysis and Calculation

Once the data is collected, DCAMM and DLS analyze the information to determine the prevailing wage rates for each work classification in each geographic area.

This analysis considers factors such as the type of work, skill level required, prevailing industry standards, and local economic conditions.

Publication and Enforcement

After determining the prevailing wage rates, DCAMM and DLS publish them in schedules available to contractors, subcontractors, workers, and the public. These rates are then enforced on public construction projects and other projects that receive public funding or support.

It’s also worth noting that prevailing wage rates may be updated and adjusted periodically, depending on the following factors:

Compliance with Massachusetts Prevailing Wage Laws

In Massachusetts, prevailing wage laws impose specific responsibilities on contractors involved in public works projects. These laws are designed to ensure that workers are paid fair wages and benefits comparable to those in the local area where the work is performed.

Here’s an overview of contractor responsibilities under prevailing wage laws in Massachusetts:

Payment of Prevailing Wages

Contractors must pay their employees the prevailing wage rates established by the Massachusetts Department of Labor Standards (DLS) for the specific trade or occupation in which they are employed.

Prevailing wage rates typically include base hourly wages and fringe benefits, such as health insurance, retirement contributions, and apprenticeship programs.

Compliance With Wage Determinations

Contractors must comply with the prevailing wage determinations issued by the DLS for each public works project in which they are involved.

These determinations specify the applicable wage rates, working conditions, and fringe benefits that contractors must adhere to throughout the project.

Recordkeeping and Reporting

Contractors must maintain accurate payroll records for all employees working on public works projects. These payroll records must include detailed information, such as hours worked, wages paid, fringe benefits provided, and deductions made.

Contractors may be required to submit weekly certified payroll reports to the awarding authority or the DLS to demonstrate compliance with prevailing wage requirements.

Subcontractor Compliance

General contractors are responsible for ensuring that subcontractors and their employees comply with prevailing wage laws. They may be held liable for any violations subcontractors commit, including failure to pay prevailing wages or maintain accurate payroll records.

Notification Requirements

Contractors must provide written notice to all employees working on public works projects to inform them of their prevailing wage rates and fringe benefits.

The notice must be posted in a conspicuous location at the worksite and include information about how employees can report violations or concerns to the DLS.

Compliance Monitoring and Enforcement

The DLS is responsible for monitoring compliance with prevailing wage laws and investigating complaints about violations.

Contractors found to violate prevailing wage laws may be subject to penalties, fines, debarment from public works projects, and other enforcement actions.

Training and Education

Contractors should ensure their employees are informed about prevailing wage laws and their rights under these laws. Training and education on prevailing wage requirements can help prevent unintentional violations and promote compliance with the law.

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Noncompliance with the prevailing wage law can result in various penalties and consequences, including

Navigating Prevailing Wage Requirements in Massachusetts

Navigating prevailing wage requirements in Massachusetts requires employers and employees to understand the laws, regulations, and processes involved. Here are some key steps to help employers and employees navigate prevailing wage requirements in Massachusetts:

For Employers:

For Employees:

Compliance Challenges and Solutions

Contractors in Massachusetts face several challenges regarding compliance with the state’s prevailing wage law. Some of these challenges include:

To address these challenges, contractors in Massachusetts can consider implementing the following solutions:

Conclusion on Massachusetts Prevailing Wages

Prevailing wages promote fairness and stimulate the state’s economy. Contractors and employees should play their part in complying with these laws to maintain a conducive business environment and a prosperous state.

Prevailing wage laws are complicated, but compliance is mandatory. Breaching prevailing wage laws has dire legal consequences, including fines and debarments.

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