California prevailing wage laws and certified payroll reporting requirements are quite complex and can be mandated by any of the following agencies or organizations, each with their own unique set of reporting requirements.
- The California Department of Industrial Relations (DIR) and the filing of Form A-1-131.
- The California Department of Transportation (CALTRANS) and the filing of a modified WH-347 form.
- The U.S. Department of Labor and the filing of a standard WH-347 Form.
- Electronic filing requirements on specific construction projects through the use of LCPtracker, TRS Consultants, and/or Elation Systems, Inc. D-BAS Labor Compliance Software.
- Additional “paper filing requirements” by Labor Compliance Organizations, such as, Golden State Labor Compliance, LLC or CalLCP.
- Electronic filing requirements being introduced on August 1, 2010 through the California Department of Industrial Relations Compliance Monitoring Unit (CMU), which will utilize the TRS Consultants Inc., on-line Labor Compliance Program
Because of these complexities, contractors frequently ask these questions about California Prevailing Wage Laws.
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Q. What is the methodology for determining the prevailing wage rate?
A. The prevailing wage rate is the basic hourly rate paid on public works projects to a majority of workers engaged in a particular craft, classification or type of work within the locality and in the nearest labor market area (if a majority of such workers are paid at a single rate). If there is no single rate paid to a majority, then the single or modal rate being paid to the greater number of workers is prevailing.
Q. How does the prevailing wage affect me?
A. California’s prevailing wage laws ensure that the ability to get a public works contract is not based on paying lower wage rates than a competitor. All bidders are required to use the same wage rates when bidding on a public works project. California law requires that not less than the general prevailing rate of per diem wages be paid to all workers employed on a public works project.
Q. What is a general prevailing wage determination?
A. When the director of the California Department of Industrial Relations determines that the general prevailing rate of per diem wages for a particular craft, classification, or type of worker is uniform throughout an area, the director issues a determination enumerated county by county, but co vering the entire area. General determinations are issued twice a year on February 22 and August 22.
Q. What is a special prevailing wage determination?
A. When a particular craft, classification or type of worker is not covered by a general determination, the awarding body may request a special prevailing wage determination. Requests must be made at least 45 days prior to the bid advertisement date.
Q. What is an issue date?
A. The date upon which copies of the determination of the director are deposited in the mail. Determinations are issued twice a year – Feb. 22 and Aug. 22.
Q. Why is there an expiration date for each prevailing wage determination?
A. The expiration date indicates when the determination of the director of the California Department of Industrial Relations is subject to change.
Q. What does it mean when there is a single asterisk (*) after the expiration date of a prevailing wage determination?
A. Prevailing wage determinations with a single asterisk after the expiration date, which are in effect on the date of advertisement for bids, remain in effect for the life of the project. Interested parties should contact the Division of Labor Statistics and Research at (415) 703-4774 for the new rates after 10 days from the expiration date (if no subsequent determination is required) or visit our website.
Q. What does it mean when there are double asterisks (**) after the expiration date of a prevailing wage determination?
A. Prevailing wage determinations with double asterisks after the expiration date indicate that the basic hourly wage rate, overtime, holiday pay rates and employers’ payments for work performed after this date have been predetermined. If work is to extend past this date, the new rates must be paid and should be incorporated in contracts entered into now.
Q. What is a predetermined change?
A. Definite changes to the basic hourly wage rate, overtime, holiday pay rates and employer payments which are known and specified in the applicable collective bargaining agreement at the time of the bid advertisement date and which are referenced in the general prevailing rate of per diem wages.
Q. What is the effective date of a prevailing wage determination?
A. The date upon which the determinations of the director of the California Department of Industrial Relations go into effect. This date is 10 days after the issue date of the determination.
Q. What is a residential project?
A. Projects consisting of single-family homes and apartments up to and including four stories are subject to payment of prevailing wages when paid for in whole or in part out of public funds, including federally funded or assisted residential projects controlled or carried out by an awarding body.
Q. What is a commercial project?
A. All non-residential construction projects including new work, additions, alterations, reconstruction and repairs. This includes residential projects over four stories.
Q. What is a coverage determination?
A. A process in which the awarding body or any other interested party (such as a contractor, employee, union or labor-management compliance organization) may request a written determination by the director of the Department of Industrial Relations about a specific construction project or type of work to be performed.
Q. When does overtime apply?
A. Compensation for all hours worked in excess of eight hours per day and 40 hours during any one week should be not less than one-and-one-half times the basic rate of pay. For specific overtime requirements, please refer to the prevailing wage determinations.
Q. What are the threshold requirements for a public works project?
A. Prevailing wages must be paid to all workers employed on a public works project when the public works project is over $1,000. If an awarding body elects to initiate and enforce a labor compliance program, that has been approved by the Director of the Department of Industrial Relations, for every public works project under the authority of the awarding body, prevailing wages are not required to be paid for any public works project of $25,000 or less when the project is for construction work, or for any public works project of $15,000 or less when the project is for alteration, demolition, repair, or maintenance work.
For more details, please refer to the applicable statutes and regulations regarding the payment of prevailing wages and General Prevailing Wage Determination(s) including the footnotes. Such information is available on the Department of Industrial Relations’ website at http://www.dir.ca.gov/.
Beginning August 1, 2010 contractors working on public works construction projects in California will find that they are subject to the regulations of the Public Works Compliance Monitoring Unit (CMU) – part of the California Department of Industrial Relations – in accordance with State Senate Bill X2-9, that was signed into law in February 2009.
The CMU will conduct the required monitoring and enforcement of the states public works prevailing wage laws on specific state bond funded and/or design-build procurement construction projects undertaken by public entities in California and awarded on or after the effect date of the regulations – August 1, 2010.
The California Department of Industrial Relations Compliance Monitoring Unit’s mission is to ensure that workers on state bond funded and/or design-build procurement construction projects are being paid the proper prevailing wage rates, published by the DIR through the Division of Labor Statistics & Research (DLSR) for the they of work they are performing (work classification). This is all done to create a level playing field for contractors and to verify that state construction projects are completed in compliance with state labor laws.
As a contractor working on these projects, how does this affect me?
The bottom line is that you will need to electronically file your certified payroll reports (rather than submit a paper form) using an independent on-line or internet based Labor Compliance Program (LCP), which has been developed by TRS Consultants, Inc. (http://www.trsconsultants.com/trs/cm/index.html and http://www.mylcm.com/index_jc.html)
You will be able to either manually enter your payroll data or upload your payroll data, from major construction accounting and payroll program (including QuickBooks when used in conjunction with our Certified Payroll Solution QuickBooks integrated add-on), into the electronic certified payroll reporting (eCPR) system.
You will need to register, and make sure that ALL of your subcontractors and lower-tier subcontractors are registered with the Labor Compliance Program (LCP), are trained in the use of the eCPR system, and are electronically submitting their certified payroll data.
eCPR training and on-going support is provided at no charge to contractors and participating sub-contractors.
As an added “bonus” ALL contract-specific wage rates and classifications are available within the eCPR system; this makes it easier for contractors to find the wage decision and applicable wage rates for their employees.
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Certified Payroll Solution has provided a bridge between QuickBooks and the Labor Compliance Program developed by TRS Consultants, Inc. since August 2004, by taking the certified payroll data and saving it in a specific file format – the user then logs into the on-line program, and uploads the file from their computer.
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Web Resources:
- California Department of Industrial Relations, Public Works Compliance Monitoring Unit Website – http://www.dir.ca.gov/dlse/cmu/cmu.html
- Current List of Bond Projects under jurisdiction of the CMU – http://www.dir.ca.gov/dlse/cmu/Bond_projects.html
- TRS Consultants Labor Compliance Management Program ONLINE DEMO – http://www.mylcm.com/index_jc.html
- How do I file electronic payroll reports – http://www.dir.ca.gov/dlse/cmu/How_to_file_epr.html
- Labor Compliance Programs & SBX2-9 Implementation – http://www.dir.ca.gov/lcp.asp
- California DIR CMU Frequently Asked Questions – http://www.dir.ca.gov/dlse/cmu/Frequently_asked_questions.html
This is something that has plagued me for years – should I leave my computer running all the time or not.
It is also a topic that has caused much debate.
Leave your PC running 24/7
Some people say that it’s better to leave your PC running around the clock than to shut it off at night and then boot it up in the morning. The reasoning behind this side of the story, is that if you never shut down your computer you will save wear and tear on it components and, therefore, extend the life of your machine.
Shut if off and boot it up in the morning
Others say that if you care at all about energy consumption (electricity is expensive after all) and how big of a carbon footprint you are leaving – turn off your computer at night. It takes less energy to boot your computer in the morning than to leave it running overnight. Plus there is the fact that many operating systems, Windows included, perform various important housekeeping tasks during shutdown and startup — another very good reason for turning the system off at night.
Personally, I’ve always been the type to shut off my computer at night when I go home (obviously I pay the electric bill plus we have a total of 6 computers in our office) and then power it up in the morning. Sure it takes a few minutes for my computer to boot up and load everything, but what the heck – I check voice mail while I’m waiting. Not having instant access to email as soon as I sit down in my chair is not going to hurt me in any way – while the increased electric bill could certainly put a bigger dent into our checking account!
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Today I was going through a bunch of old PC World magazines and found an article written by Robert Strohmeyer about this very subject. Robert stated in his article that he had interviewed some of the top techies at HP, Seagate, and other major companies, and that nobody seemed to know how this rumor was born. But they all agreed on one thing “leaving your PC running 24/7 was NOT a good thing” and that “the claim of leaving your computer running overnight was good for it – was totally bogus.”
An HP Techie, Ken Bosley, who has spent years researching hard-drive reliability says that “you shouldn’t waste energy to extend the life of a computer by even a very small amount” and discounts the notion that “shutting down and starting up a computer puts undue stress on the components, noting that most systems are retired because of obsolescence, not because of hardware failure.”
Where do you stand on this issue? Do you shut your computer off at night or always leave it running…….and why?
Determining the cost-per-hour for each piece of equipment or machinery that your company owns and uses on a job site is a great tool for understanding, and even eventually, recouping the actual cost of the machine itself. Once you have this information, you can improve the accuracy of your bidding, book equipment and machinery costs in your accounting software, and even identify ways in which you can maximize expenditures throughout the year.
Equipment and machinery cost-per-hour rates are calculated by adding together three distinct pieces of information:
- What it costs to own or lease (acquisition cost-per-hour)
- What it costs to maintain (maintenance cost-per-hour)
- What it costs to run operate it (running time fuel consumption cost-per-hour)
1. Calculating Acquisition cost-per-hour (ACPH)
Formula: Divide the total price paid (including interest paid) by the projected number of lifetime hours.
Example:
| 21” rotary mower purchase price: | $1,100.00 |
| Interest | none |
| Lifetime hours: | 750 hours (2.5 hours/day, 5 days week/30 weeks/year for 2 years) |
| Salvage value: | none |
Acquisition cost-per hour: $1,100.00 divided by 750 hours = $1.47 per hour
2. Calculating Maintenance cost-per-hour (MCPH)
Formula: Divide the estimated lifetime maintenance cost (repairs, parts, labor, blades, spark plugs, oil changes, filters, etc.) by the number of lifetime hours.
Example:
Lifetime maintenance cost: $600.00
Maintenance cost per hour: $600.00 divided by 750 hours = $0.80 per hour
3. Calculating Running-time Fuel Consumption cost-per-hour (RT/FC CPH)
Formula: Determine how long one gallon of fuel lasts for the piece of machinery. Divide the price per gallon of the fuel by the hours used each day.
Example:
Cost per gallon of fuel: $2.50
Running-time fuel consumption cost-per-hour: $2.50 divided by 2.5 hours = $1.00 per hour
| Total Cost-Per-Hour:$1.47 Acquisition cost-per-hour (ACPH)$0.80 Maintenance cost-per-hour (MCPH)
$1.00 Running-time Fuel consumption cost-per-hour (RT/FC CPH) $3.27 |
Let’s look at another example, this time determining the cost-per hour for a compact tractor.
| Purchase Price: | $23,000.00 |
| Interest: | $ 5,520.00 |
| Salvage Value: | $ 8,000.00 |
| Life Expectancy: | 3,000 hours (300 hours per year for 10 years) |
| Lifetime Maintenance Cost: | $18,000.00 |
| Fuel Price: | $2.50 per gallon |
| Fuel Used per hour: | 1.5 gallons |
Acquisition cost-per-hour (ACPH): ($23,000.00 + $5,520.00 – $8,000.00 = $20,520.00)
$20,520.00 divided by 3,000 hours = $6.84
Maintenance cost-per-hour (MCPH): $18,000.00 divided by 3,000 hours = $6.00
Running-time fuel cost-per-hour (RT/FC CPH): $2.50 divided by 1.5 hours = $1.67
Total Cost-Per-Hour: $6.84 + $6.00 + $1.67 = $14.51
| Notes: Your dealer should have data regarding estimated lifetime maintenance cost and fuel consumption. If you buy used equipment, cost it out using the “new” purchase price. The total cost-per-hour is usually the same for new and used equipment, and useful life, repair and maintenance costs, are easier to determine for new equipment. Using the new purchase price also automatically adjusts your rates for inflation and price increases.You can cost out leased machines using the same formulas and adjusting the life expectancy, lifetime maintenance and fuel price, to account for the shorter term.
To determine fuel cost, you can also fill up the tank and divide the fill-up price by the total running hours. Even if you prefer to base your estimates on a per-labor-hour rate, the Cost-Per-Hour method prevents you from understating or overstating the actual equipment cost for the job being bid. |
You can verify your Cost-Per-Hour figures in several ways:
- Compare your hourly rates to those of your local equipment rental company. Reduce their rental rates by 40-50% to remove their markups. Your rates should be reasonably close to theirs.
- Contact your local dealer to verify maintenance costs, production rates, fuel consumption, lifetime hours, etc.
- Contact your local Department of Transportation (DOT) office, they have manuals containing CPH data for maintenance, and will often share these figures with you for comparison purposes.
Ways in which you can reduce your Cost-Per-Hour figures:
- Take advantage of multi-unit discounts offered by some manufacturers.
- Check with your local dealer about new engine technologies.
- Use the CPH calculations to develop a better understanding of which piece(s) of equipment will lower your field operation costs over time.
You can also use the Equipment Cost-Per-Hour (ECPH) to develop a better understanding of which pieces of equipment, or brand, could actually lower your field operation costs over time. By matching up the purchase price of several different pieces of machinery against long-term variables, such as annual maintenance cost and serviceability, production rates, fuel costs, etc., the ECPH will help you to confirm the truth of you get what you pay for.
Armed with the knowledge of equipment cost-per-hour, bring this into your accounting program and job costing. This will help you to take the “guess-work” out of future bidding and increase your company’s bottom line.
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Realizing that these formulas are complex and time-consuming to perform; and the fact that given the current state of the economy, that it is extremely critical to be able to quickly and accurately, update these prices at a moment’s notice – we’ve developed an Excel spreadsheet that will allow you to quickly and easily update these figures.
Download our Equipment Cost Calculator at http://www.sunburstsoftwaresolutions.com/view-document-details/equipment-costs-calculator.htm.
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Once you know your Equipment Costs per hour, use QuickBooks to track these costs for job costing purposes by downloading our FREE 17-page eBook “Advanced Job Costing – Getting Equipment Costs into Job Costing” by clicking here. |
As a business owner there can be several different situations that you encounter where you might need to include a long legal disclaimer or explanation when you sell a specific item, offer special discounts, provide warranty disclaimers and information or explain your payment requirements when bidding on a job or even invoicing a customer.
There are four different methods for addressing this issue; the one that you choose will depend on what makes the most sense for your business:
- Items
- Template
- Letters Function
- Outside of QuickBooks
- Using Items to add long disclaimers – If the additional information needs to be included when a specific product is sold, that information can be included in the description OR you can create a new item with a zero sales cost for the purpose of adding the information to a Purchase Order, an Estimate, or an Invoice. The advantage of creating a separate item is that you can place the disclaimer item where you would like it on the form; right after the item it relates to, or at the bottom of an Estimate form. Later, you can delete it for billing purposes – as long as both you and your customer have a copy of the Estimate that contains the detailed information.
- Modifying the Form Template to include long disclaimers – If the disclaimer is long and you have the same disclaimer for every Estimate you create, for example your billing terms, and would like to make it a standard part of your form, using the Long Text Disclaimer section on the template itself may be the best solution. Choose Lists -> Templates -> select form -> Edit. The text can be entered and then the font size and placement can be adjusted using the Layout Designer.
- Using the QuickBooks Letters function – If the disclaimer is exceedingly long, after you create the form create an accompanying Letter in QuickBooks. Access the Letters function from the Customer Center by clicking on the Word option. Use this method with option with option 1 or 2 above to indicate that additional information is included on a separate page.
- Outside of QuickBooks – Depending on what needs to be included, it might make more sense to print the disclaimer on the back of the form. It would also be possible to use this method in conjunction with option 1 or 2 to state something along the lines of “see additional disclaimer information on the back of this form” to include a reference to the information without having to actually include it on the form.
