Published date: 12/14/2023
Cheers! We’ve made it to the end of 2023.
After the whirlwind of news for public works the last year or so, we’ve decided to slow things down a bit and discuss one of the lesser talked about (but still very important) aspects of prevailing wage compliance: employee interviews.
No, we’re not talking about the hiring process… We mean interviews occurring on the actual project site with existing employees of contractors working on the job.
Still not ringing a bell? They’re often referred to differently around the industry. Some government agencies call them Labor Standards Interviews. Other project owners or contractors may refer to them as wage interviews, jobsite interviews, or field interviews. Regardless of what you call them, they play a crucial role in prevailing wage compliance.
The “Who” and the “What” of Employee Interviews
These interviews are conducted by an entity enforcing labor compliance – typically a contracting agency (but they might also be performed by a prime contractor that’s looking to get ahead of potential violations that other subcontractors may make on their project). Per Davis-Bacon, it is required of agencies to conduct them on their projects receiving federal funds, although the application and frequency with which they are deployed is up to their discretion.
One of the main reasons for these interviews is simply to verify that the data submitted on contractor certified payrolls is an accurate representation of the work being performed in the field. Because even though a contractor might appear compliant on paper, the jobsite can sometimes tell a different story.
Let’s briefly breakdown the different aspects of these interviews.
Verifying Hours Worked and Scope of Work
These interviews provide an opportunity for project owners and contractors to verify the actual hours worked by employees. By talking to them and cross-referencing interview responses with the certified payroll reports (CPRs), discrepancies in reported hours can be identified and addressed.
Additionally, questions may dig into the scope of work – specifically about job roles and tasks performed by employees to ensure that they align with the correct classifications. The wage determination(s) for the project may be very particular about which types of work fall under a certain craft classification. And since different classifications likely have different pay rates, it’s quite common for contractors to mistakenly pay workers the incorrect rate. This is something that may not be obvious by looking at a certified payroll alone.
Confirming Wage Rates and Fringe Benefits
While talking with employees, interviewers also typically confirm the wage rates and fringe benefits their employer pays them. This helps ensure that workers are receiving the correct compensation along with any mandated fringe benefits, including proper deductions or contributions such as health insurance or pension contributions.
And again, any inconsistencies between the information provided in interviews and the CPRs can be investigated and corrected to maintain compliance. This is typically where “bad actors”, or contractors that willfully attempt to circumvent the laws, get exposed.
Identifying and Preventing Potential Violations or Issues
Interviews provide an avenue to discover potential violations or issues related to both prevailing wage compliance and other labor laws in general. Beyond direct answers to questions, workers may use this opportunity to inquire or express concerns about their pay, working conditions, or other issues that could be indicative of a lack of proper compliance oversight.
Prime contractors conducting interviews themselves can also use it as an opportunity to promptly address and rectify any issues raised during interviews before an agency discovers them, mitigating the risk of legal action, penalties, restitution, or (in egregious cases) possible contract termination due to non-compliance.
Documenting Compliance Efforts
Conducting employee interviews demonstrates a project owner’s or prime contractor’s commitment to prevailing wage compliance. Agencies that fail to conduct proper oversight of compliance can potentially jeopardize funding for future projects, and primes have their reputation and profitability on the line. In the event of an audit or investigation, the documentation of these interviews serves as evidence that these parties are actively taking steps to ensure adherence to prevailing wage laws.
Worker Education and Communication
Employee interviews can also serve as a platform to educate workers about prevailing wage laws, their rights, and the benefits they are entitled to receive. Clear communication can help foster a positive relationship between the contractor and employees, promoting transparency and trust within the workforce.
How Agencies and Primes Can Leverage Technology to Conduct Interviews and Identify Violations Much Faster
For organizations looking to get a tighter grip on compliance but are limited with resources, they might be relieved to find that there are electronic solutions that can both streamline the interviews AND automate the verification process after they have been conducted. They can utilize a mobile application to record responses electronically, and when it comes time to crosscheck them with certified payroll data, the application integrates with certified payroll software to identify discrepancies automatically.
These materials are being issued with the understanding that LCPtracker is not engaged in rendering legal or other professional services and is providing these for informational purposes only. If legal, accounting, or tax expert assistance is required, the services of a competent legal, accounting or tax professional should be sought.