by Sunburst Software Solutions, Inc.
Archives by Month

Certified Payroll/Prevailing Wage

Certified Payroll Reporting requirements are complex and getting more so just about everyday! Don’t let anyone try and tell you that a single form will satisfy ALL of your requirements – they could very well be wrong! Learn how to handle special certified payroll reporting requirements and how to make QuickBooks handle the backbone of those requirements..

Technology is Changing How We Submit Certified Payroll Reports

Print Friendly

Technology – computers, software, and the internet – has changed how we create and submit certified payroll reports over the last decade.

typewriterFor many years a paper certified payroll report – either the Federal WH-347 or a state specific form – was what you needed; and then you dug out the typewriter and typed the information onto the form – or – you painstakingly handwrote the information onto the form.

Then along came computers and programs like LOTUS 1-2-3 and Excel and we would recreate the layout of the paper form using the program and fill it in each week – it was faster, neater, easier to correct typo’s, and we felt that we were automating the task at hand.

Then, some of the software companies created a “certified payroll report” which they claimed was a viable substitute – but they didn’t look anything like our paper forms and often times when we submitted those reports they were rejected and we had to go back to taking the information from the report provided by the software and manually put it into either the paper form or our spreadsheets – again, we felt this was automation – at least we had most of the data for each job in one place.

Fast forward to 2003 and the first of the online labor compliance programs – where you would log into a website with your username and password and then type in your certified payroll data into their program using web based forms – for certain jobs that you worked on.  Yes, you could upload you certified payroll data IF you could recreate their special machine-readable format.

submitFast forward again to the present day.  Today, there are now one or more agencies in 17 states that require certified payroll reports to be electronically submitted via numerous on-line labor compliance programs developed by companies like LCPtracker, MyLCM (TRS Consultants/Hill International), and Elation Systems; that are used nationwide; along with state or agency specific compliance programs like eMars,  Texas Department of Transportation, Wisconsin Department of Workforce Development, Maryland Department of Labor, Licensing and Regulation , the Alaska Department of Labor, New York Department of Transportation and more.  Again, you log in to these websites with a secure username and password and then manually input your certified payroll data – OR – you attempt to create one of their required files in a machine readable format – .txt, .csv, .xml or a specially formatted Excel file.

Manually taking your payroll information from your software and transferring it to paper forms, fillable pdf.’s, or putting it into carefully crafted Excel spreadsheets is one thing – but putting that same data into a format that is designed solely for a machine to read is quite another!  For this task, you really should rely on 3rd party software developers who have worked extensively with the agency to ensure that the payroll data you see is transferred correctly into their machine readable format; leaving you to simply login and then upload the required file in the correct format.

Is a machine readable certified payroll report really so different, you ask…..

Indeed, machine readable certified payroll reports are quite different.  Here is a simple 1 page report using the Federal WH-347 form1-05 listing 2 employees and here is that same report in electronic format (now 11 pages) that you would need to submit to Elation Systems.

Isn’t it time you started really automating your certified payroll tasks?

As a QuickBooks user, I’m certain that you’ve discovered the built-in certified payroll report has it’s drawbacks and if you need to submit your payroll data via Elation Systems, LCPtracker, or MyLCM you’ve found that you have to manually enter your data.  This is where our Certified Payroll Solution program for QuickBooks really becomes a huge timesaver; because it will generate BOTH paper and electronic versions of your certified payroll reports – here’s a link to a short video showing how easy it is to set it up.  We have been providing electronic certified payroll reporting formats for various labor compliance programs since 2003.

Ask Me Anything – 10 Common Questions about Certified Payroll

Print Friendly

Below are the 10 most common questions I’m asked just about every week about certified payroll and their answers. While these question commonly come from QuickBooks users the answers provided will apply to anyone who has to deal with the complexities of prevailing wage reporting.

10 common questions about certified payroll1. I have to submit the Federal WH-347 form, how do I report the fringes that my company pays to the union hall?

The Federal form only requires that you report payments of cash in lieu of fringe benefits (or fringe dollars that you pay to the employee as part of gross wages for the week) – NOT fringes you pay to the Union Hall on behalf of the employee. For fringes paid to the Union Hall, check box 4(a) Where Fringe Benefits are paid to approved plans, funds, or programs on the Statement of Compliance (sign-off sheet). This doesn’t mean that you will not be asked to provide this information, but as a general rule it is not required. See the instructions on the U.S. DOL website for supporting information – http://www.dol.gov/whd/forms/wh347instr.htm

2. Do I include my subcontractors on my certified payroll reports?

No. The certified payroll reports that you submit should ONLY include information about your employees. Your subcontractors should submit a certified payroll report to you with information about their employees. You’ll then make a copy of the Subcontractors report and include it with your own.

3. Can I pay my employees on a bi-weekly basis?

Technically, everything to do with Certified Payroll is based on a weekly basis. If your accounting software can accrue or split the wages, taxes, etc. correctly between two individual weeks then you should be ok. You can add a “Remark” to the Statement of Compliance about payroll being issued on a bi-weekly basis – but I make absolutely no guarantees that you won’t get called on the carpet for it.

4. How do I report fringes paid in cash on the WH-347?

When you pay fringes in cash you report the base rate of pay/cash fringe amount in Column 6 on the report. So, for example, if the wage decision states that the rate of pay is $10.00 and the fringe rate is $5.00 and you pay the full fringe rate in cash – in Column 6 you will report $10.00/$5.00.

5. Where do I find the base and fringe rates that need to be paid to an employee on a job?

Federal Wage Determinations can be found on-line at http://www.wdol.gov/dba.aspx, however, most contracts have a Contracts Provisions section with a Labor Standards Clause – this is where you should find the Wage Decision for your specific project.

6. I’m a non-union contractor, can I take a credit for company paid health insurance?

Yes, but the credit must be annualized (see question #7). Under the Davis-Bacon Act and 29 C.F.R. § 5.23 other company paid items such as Life insurance, Pension, Vacation, Holidays, Sick Leave and Supplemental Unemployment Benefits may also be used as a credit. Check State specific prevailing wage laws to make sure these items are also allowed – just because at the Federal level something is allowable does not mean it is also allowable at the State level.  For more information, see Calculating & Displaying Fringe Benefits on a Certified Payroll Report.

7. How do I calculate credits for company paid health insurance?

To calculate a credit you must annualize the total contribution between both prevailing and non-prevailing wage hours worked. A good rule of thumb (and a common practice) is to divide the annual contribution by 2080 hours. So, in the case of taking a credit for the company paid portion of an employee’s health insurance you would first take the monthly contribution amount and multiply it by 12 months (this determines the annual contribution) and then divide the annual contribution by 2080 hours to determine the hourly credit. For additional information consult this section of the U.S. Department of Labor Prevailing Wage Resource book – http://www.dol.gov/whd/recovery/pwrb/Tab10.pdf

8. How do I report salaried employees?

My advice on this one, especially if you accounting software cannot break down salary to an hourly value – is to switch the employee to an hourly basis.

9. Is QuickBooks compatible with LCPtracker, MyLCM and other compliance software?

No, while QuickBooks is capable of producing an alternate/substitute WH-347 there is no ability to upload that information. The compliance program that you mentioned (and others) require additional information to be submitted that is not tracked in QuickBooks, so you will either need to manually enter the data on-line or check out Certified Payroll Solution, which will create machine readable certified payroll data for most of the labor compliance software – http://www.sunburstsoftwaresolutions.com/certified-payroll-solution.htm

10. I can’t find a work classification for my employees on the Wage Decision …. Help What Do I Do?

At the Federal level, you can complete a Request for Authorization of Additional Classification and Rate form – http://www.dol.gov/whd/govcontracts/SF1444.pdf

If this is a State funded construction project contact the Prevailing Wage Division of your State Department of Labor to determine if they have a similar form.

 

Are Your QuickBooks Payroll & Certified Payroll Processes Efficient?

Print Friendly

QuickBooks Payroll and Certified Payroll processes really need to be efficient in order for a business to be successful.  When one of your businesses largest job expenses is payroll, you need to:

  • pay your employees correctly and on time to keep them happy,
  • make sure that those payroll costs are part of your accounting system so those costs are included in job costing reports,
  • and you need to submit your certified payroll reports accurately and in a timely fashion in order to be paid.

Yes, it’s a vicious cycle!

Ask any business owner how efficient he thinks his payroll and certified payroll processes are and I’m betting he’ll either say “oh they are very efficient” or “they could be better”.  Ask his payroll clerk who is dealing with a lot of manual data entry and I bet that she’ll have a far different answer!

I attended a really great webinar a couple of weeks ago, called “A Tale of Two Payroll Processes” – given by CPA Practice Advisor and TSheets and I have to admit I was pretty surprised by one of the slides in the presentation – Processing Payroll: Industry Snapshot (shown below).

Right click to enlarge image.

Right click to enlarge image.

When I first looked at this slide, I thought “awesome” 64% of small businesses process payroll in-house.

But then I looked more closely:

  • 62% use a spreadsheet, and
  • 66% do not have a payroll system that is tied to their accounting software!

manual payroll processesEgads!  Immediately I was mentally transported back about 15 years in time – when QuickBooks desktop payroll was not as robust as it is today and there were no third-party add-on available to automate critical tasks, like preparing certified payroll reports – and I was doing a LOT of payroll and certified payroll tasks manually using complex Excel spreadsheets.  As a bookkeeper, I hated my job – I spent 40+ hours every week doing nothing but entering the same employee time and payroll data in multiple places – over and over again in multiple Excel spreadsheets as well as in QuickBooks to cut paychecks!  If you were to have asked my boss at the time if the processes were efficient – he would have told you yes – because I was using Excel to automate the process instead of having to hand write all of the data!

For some businesses using a spreadsheet or having a payroll system that isn’t tied to their accounting software might be ok – at first glance. If you are a contractor or any type of business that needs to track employee time against specific customers or jobs and tasks or cost codes – then using a spreadsheet or a payroll system that isn’t tied to your accounting software isn’t efficient at all.

Payroll is a HUGE part of the cost of running a business and for many business type’s payroll is one of the largest portions of the cost of doing a job.

I know that many business owners who use QuickBooks will often use an outside payroll service to handle payroll – my question are:

  • • if you need job costing how are you getting those payroll costs into QuickBooks
  • • how are your certified payroll reports being created
  • • And then how efficient are the processes?

Payroll that is not tied to or part of your accounting system and certified payroll reports that are issued manually using complex Excel spreadsheets or fillable forms are time-consuming, tedious, error-prone and above all else disconnected from the rest of your financial data. This makes it difficult to obtain accurate and error-free financial information, because you are always having to enter the same information in multiple places.

If this sounds familiar and you would like to learn how to automate your payroll and certified payroll processes – join me tonight from 5-6 EST on Google+ for a 1 hour hangout called the Tale of Two Certified Payroll Processes, where we’ll compare the manual vs. the automated processes of entering employee time, generating paychecks, and finally creating certified payroll reports, EEOC and union dues and fringe benefit reports.  Can’t make the live hangout – that’s ok, it will be recorded and I’ll post the link so you can watch it on YouTube.

Below is the recording on YouTube of the hangout, it was a lot of fun!

YouTube Preview Image

 

 

 

Automating Job Costing Overtime, an 800 pound gorilla with an attitude

Print Friendly

Calculating and distributing employee overtime is a burdensome process that many business owners and payroll administrators have to deal with on a weekly basis.  Everyone has a different opinion on just “HOW” that overtime is to be calculated and distributed.  By everyone, I mean the business owner, the payroll clerk, heck even the Federal and State government.  No wonder it’s just a problematic situation!

job costing overtime - an 800 lb gorillaAt first blush this seems drop dead simple.

Overtime goes to the time worked after 40 hours, or maybe over x hours per day as well.  This seems reasonable, but would it be simpler if overtime were just distributed over all the jobs that the employee worked that week.  That seems fairer, as each job gets a share of the overtime costs for that week.

Then again, maybe the overrun that messed with scheduling to cause overtime in the first place happened at the start of the week, the jobs at the end of the week, just so happen to be all overtime hours because of that job.  So the job that really should have the overtime attributed to it, gets none or only a share of the overtime, while the innocent jobs that went as planned bear a higher, “undue” or “unfair” cost.  Heck the job that caused the delays and overruns might have happened the week before.

One should also consider costing all time at the regular rate, and then costing all overtime to the overhead job.

And now don’t forget to do weighted average overtime after the overtime is initially calculated adds another layer of … well … shall we say obfuscation.

Even on a case by case basis, there often is no clear right or wrong answer.  Maybe there is a reason Job Cost Accounting is consider such a bear by so many and why some accountants avoid it at all costs.

Automatically distributing overtime, like Crew Overtime Entry Solution can do, will either occur after the 40 hours / x hours per day, or it can average weight distribute overtime over all jobs.  Or it can leave your entered hours alone and just make an overtime adjustment to an overhead job.  But even with automation there will be basic tradeoffs that will occur.

For usually straight forward set in stone accounting, this area is decidedly gray.

 

Understanding & Implementing Prevailing Wage Decisions

Print Friendly

Prevailing Wage Decisions can sometimes be very difficult to understand and implement, however, it’s very important that you learn to read and apply what is found in them.

The Wage Decision for a Public Works or Government Construction project provides you with the prevailing wage requirements, including Work Classifications, hourly rates of pay and hourly fringe benefit amounts for every trade classification that could possibly be involved on a project.  Prevailing Wage requirements are found in the Labor Standard Clause of the Contract Provisions section of the bid package and become the backbone of payroll processing requirements for that specific project.

Unraveling a Prevailing Wage DecisionOne would think that if a project had prevailing wage requirements that the Wage Decision would contain an easy to understand breakdown of the fringe benefit portion of the prevailing wage – however, that is not always the case.  Wage Decisions can be quite difficult to understand; based on whether the project is funded with Federal or State money and whether or not there is a large Union presence in a specific state and unraveling this can quite often be very confusing.

Please be advised that the following is ONLY a general overview and does NOT take into consideration whether this is a Union or Non-Union shop or whether the fringes are paid to the Union Hall or into one or more bona-fide plans on behalf of the employee, or if you are paying the full fringe amount in cash in lieu of fringes.

Let’s look at some sample wage decisions:

Basic:

It lists the Work Classification, the base hourly rate, and the full fringe benefit amount that you must pay.  For example, employees who are classified as Flaggers are paid:

  • a base rate of $11.15 per hour,
  • and an hourly fringe benefit rate equal to $4.40 per hour

This means that you MUST pay any employee who is classified as a Flagger NO LESS than a combined grand total of $15.55 per hour.  In this specific instance the hourly fringe rate must equal $4.40 per hour, with no specifics as to what type of union or bona-fide plan fringes must be paid (Health & Welfare, Pension, Vacation/Holiday, etc.).  If you are not a Union Shop or have bona-fide fringe benefit plans in place you could end up paying the entire $4.40 in cash in lieu of fringe benefits.

A more specific wage determination:

Sometimes a wage determination is pretty darn specific.  For example, employees who are classified as an Engineering Construction Cement Mason are paid:

  • a base hourly rate of $26.57, with Employer Payments of
  • $6.10 per hour for Health and Welfare
  • $5.95 per hour for Pension
  • $2.50 per hour for Vacation/Holiday
  • $0.50 per hour for Training
  • $1.73 per hour for Other (Supplemental Dues)

In this instance, anyone that is classified as an Engineering Construction Cement Mason must be paid a grand total of no less than $43.35 per hour ($26.57 base plus $16.73 total fringe package).  This wage determination also provides you with specific types of fringe benefits that you are expected to pay – as well as the actually hourly values – if you are a Union Shop.  If you are an open shop you can submit the total ($16.73) to one or more bona-fide plans or pay it as cash in lieu of fringes.

A wage decision that provides very little in the way of helpful/useful information:

Sometimes a wage decision is about as clear as mud!  For example, employees who are classified as an Asbestos Worker with a job in New Castle is to be paid $27.64 per hour.

Last week, as a guest speaker for L2 Federal Resources, I delivered a live webinar called “Unraveling Certified Payroll Requirements for Government Contractors” and I talked a lot about Wage Decisions and the different ways in which contractors paid the fringe benefit portion.  I always tell people that this is an introductory class which focuses on complying and completing the Federal WH-347 form; and that while I have a fairly good understanding of prevailing wage laws in all 50 states – that there is much of the fine print in the rules, regulations, and union requirements that I only “know enough to be dangerous” and that “specifics” should always be directed to:

  • The company that directly hired them
  • or the Prevailing Wage Division of the State their business is located in (or that the job is in)
  • or the Union Hall

So here is where it gets interesting!

One of the webinar attendees asked the following question:

Do you have any categories that you can go over with +5, -5 A & B benefits?  For example, an elevator mechanic has a base rate, then B: +5 for over 5 years @ 8% vacation, -5 under 5 years @ 6%, A-# of holidays

Well that was all of the information that she gave me – and it’s sometimes the problem with webinars!  Anyway, without any additional information and not enough time to obtain the specifics (because obviously there is a LOT that is missing), I wasn’t able to provide an answer.

So I did a Google Search and this is what I came up with.

Elevator Mechanic:  Base Rate $48.23/Fringes $25.185

With a footnote that said:  Employer contributes 8% of regular hourly rate as vacation pay credit for employees with more than 5 years of service, and 6% for 6 months to 5 years of service.  PAID HOLIDAYS: New Years Day, Memorial Day, Independence Day, Labor Day, Veterans Day, Thanksgiving Day, Friday after Thanksgiving, and Christmas Day.

Ok, so this one is sort of confusing, but still all of the information appears to be right there – and without any further information this is how I read this:

We have the base rate of $48.23 per hour:

A)  IF an employee has 6 months to 5 years of experience his vacation fringe is equal to 6% of his BASE rate – OR – $2.8938 per hour ($48.23 x 6%), so out of the full fringe of $25.185 per hour, $2.8938 per hour is the Vacation fringe amount.

B) IF an employee has MORE than 5 years of experience his vacation fringe is equal to 8% of his BASE rate – OR – $3.8584 per hour ($48.23 x 8%), so out of the full fringe rate of $25.185 per hour, $3.8584 per hour is his vacation fringe.

There is no such thing as a totally straight forward, easy to understand Prevailing Wage Determination that I’ve ever seen (or even heard of for that matter), but you do need to be able to learn how to understand and interpret them – and going to the “source” (General Contractor, State Prevailing Wage Division, Union Hall, etc.) is the best way to learn.

I hope you found this post to be informative and I do apologize for the length, there is just a lot of ground to cover even in a general overview.

 

EEOC Reports & Government Funded Construction Projects – Q & A

Print Friendly

EEOC Reports are just another compliance requirement that must be met when you perform work on government funded/prevailing wage jobs – in addition to the submission of a weekly certified payroll report. In this Q & A we’ll discuss your obligations, what types of forms you might need to file, and when you have to file them.

Right click to enlargeWhat is the EEOC and what do they do?

The U. S. Equal Employment Opportunity Commission (EEOC) is responsible for enforcing federal laws that make it illegal to discriminate against a job applicant or an employee because of the person’s race, color, religion, sex, national origin, age, disability or genetic information.

What is an EEOC Report?

An EEOC Report is really nothing more than than a report that includes how many employees you have that work under specific work/trade classifications by race and gender; including any apprentices or on-the-job trainees.

Some State specific reports also will want the number of hours worked by classification, race, and gender for the month as well as cumulative hours over the life of the project.

Who has to file an EEOC Report?

Most employers with at least 15 employees are covered by EEOC laws. Most labor unions and employment agencies are also covered.

What report must I file?

Unfortunately, that depends on whether you are working on Federal or State funded construction projects.

State agencies can require that you submit an EEOC report on a weekly or monthly basis, if the construction project is funded with State money.

If you perform work on Federal-Aid Highway Construction projects, you may be required to submit monthly reports – using either a Federal or State DOT specific form as well as an Annual Report such as Form FWHA-1391 . Federal-Aid Highway Construction Contractors Annual EEO Report, which is usually due by the 15th of August and uses employment data from the last full pay period ending in July.

NOTE: Because most State and Federal EEOC Reports are still paper forms, many software programs will automatically generate these reports for you – this is a huge timesaver.

What are the race/ethnicity categories that must be reported?

Currently there are seven race/ethnicity categories: Hispanic or Latino, White, Black or African-American, Native Hawaiian or Other Pacific Islander, Asian, American Indian or Alaska Native, and Two or More Races.

You will need to track and record race information and can ask employees to voluntarily provide you with this information. In Section 4 of the EEO-1 instruction booklet you’ll find sample language that you can use in an employee questionnaire to explain the EEO-1 voluntary self-identification process – page 4 of the pdf found at http://www.eeoc.gov/employers/eeo1survey/upload/instructions_form.pdf

If an employee declines to provide you with this information, you can visually make this determination.

Are there any other EEOC Reports that I might have to file?

Oh yes, reporting compliance can be very confusing!

If you have 100 or more employees or are a federal contrator, you will most likely also have to file the EEO-1, VETS-100, or VETS-100A forms as well.

Private employers with 100 or more employees and federal contractors with 50 or more employees and a contract of $50.000.00 or more require the submission of an annual EEO-1 Report (also known as the Employer Information Report EEO-1) to the Joint Reporting Committee (JRC) – a committee of the EEOC and the Office of Federal Contract Compliance Programs (OFCCP). Like the other reports we’ve mentioned, the EEO-1 track employee data by race, ethnicity, sex, and job/work/trade classification.

The EEO-1 must be filed each year by September 30, so the deadline is fast approaching – and you should have received instructions in the mail in mid-August. As an employer, you can use employment figures from any pay period in July through September. Online reporting is the preferred method of filing – you can file online at http://www.eeoc.gov/employers/eeo1survey/index.cfm

Some contractors, regardless of the number of employees they have, must also file a VETS-100 or VETS-100A form. Both of these forms require that you report the number of veterans you employ and their job/work/trade classifications and these reports are usually due on September 30 as well.

The VETS-100 form must be filed by contractors with current contracts of at least $25,000.00 that were entered into before December 1, 2003.

The VETS-100A form must be filed by contractors that entered into a contract valued at $100,000.00 or more after December 1, 2003 OR if you entered into a contract before December 1, 2003 and that contract now has a value of $100,000.00 or more.

Further information can be found at http://www.dol.gov/vets/vets-100.html If you have questions about either the VETS-100 or VETS-100A forms you can get help by calling (866) 237-0275 or by sending an email to VETS100-customersupport@dol.gov

 

Weekly Wrap-Up: News You Can Use 6/15/2012-6/21/2012

Print Friendly

 

Weekly wrap-up of news and information from around the web – there’s so much information out there that it’s difficult (at best) to keep up! I’ve added a WordPress plug-in that grabs information from my Twitter stream to help me (and hopefully you as well) keep up with everything. Look for the Weekly Wrap-Up: News You Can Use every Friday. I’ll try to be consistent and organize the information into the same categories each week.

news you can useAccounting & Taxes

eBooks, Webinars & Videos

QuickBooks payroll tipsPayroll, Certified Payroll & Prevailing Wage

QuickBooks tipsQuickBooks

Small Business, Organization & Productivity

construction newsConstruction

Social Media, Marketing, Website Design

Well, that’s it for me this week.  Do you have any news that you’d like to share?

How To Report an Owner/Employee on Certified Payroll

Print Friendly

Certified Payroll is complex and so are the reporting requirements for owner/employees.  See this question submitted by a reader.

Ask the Expert - Q & AI am unsure of how to report the owner of the company on the certified payroll report.  He is a union member but not paid union benefits.  He is paid the prevailing union wage in our area.  He is paid thru QuickBooks payroll & the appropriate payroll taxes are paid.

The accountant suggests we do not report the fringe benefits on the certified payroll because he does not receive union benefits as he is the owner & does not have union benefits.

I am confused as to how to report his wages.  Must I make a ‘separate’ payment to him of what the total prevailing wage for a union worker would receive?  Or would I simply ‘add’ the amount of the prevailing wage to his hourly rate?  Please advise, thank you! Lynda


Hi Lynda,

You do have quite an interesting situation on your hands!

wh-347 certified payrollFederal Prevailing Wage requirements, through the U. S. Department of Labor, indicate that working foreman or supervisors that regularly spend more than 20% of their time performing actual construction work on the project are considered to be covered and, therefore, required to be reported on the certified payroll report.  I’m making a HUGE assumption that the owner of your company falls into that “working foreman or supervisor” category when he is out on the job site.

Some states, including Alabama, have a special requirement for the Foreman category.  In Alabama, employees who fall under the “Foreman” Work Classification are reported with no hours, pay rates, earnings, or deductions – just their name, last 4-digits of their social security number, number of withholding exemptions and work classification.

Under the Davis-Bacon and related Acts, the contractor is required to pay not less than prevailing wage, including fringe benefits, as predetermined by the Department of Labor.  The contractor’s obligation to pay fringe benefits may be met either by payment of the fringe benefits to bona fide benefit plans, funds or programs or by making payments to the covered workers as cash in lieu of fringe benefits.

I totally agree with your accountant that you do not report any fringe benefit amounts on the certified payroll report for the owner, because he isn’t receiving them – during an audit that would cause quite a problem.

My recommendation based on the information that you have providedwould be that the owner of the company be paid the TOTAL of the Union wage PLUS the full fringe benefit amount – for example if the hourly union wage was $20.00 and the total fringe benefit rate equaled $10.00 his QuickBooks rate of pay would be $30.00 for Straight time and $40.00 for Overtime.  Overtime would be calculated as $20.00 (base) + $10.00 (1/2 base) + $10.00 (Fringe).  On most state specific forms you would report $30.00 in the Rate of Pay box, however, on the Federal WH-347 you would report the rate of pay in Column 6 as $20.00/$10.00 for Straight/Regular time and $30.00/$10.00 for Overtime.

This is indeed a complicated situation and I suggest that you discuss my recommendation with the Union Hall, the General Contractor or Project Administrator, AND your local Department of Labor’s Prevailing Wage Division to ensure that what I have suggested will meet with their reporting requirements.

I hope this helps.

Nancy

Worker’s Comp Increases 45% in California, Beginning 7/1/2012

Print Friendly

 

California Worker’s Compensation Insurance premiums will increase by 45% over last year  for renewals after July 1, 2012 according to The Worker’s Comp Executive.

don't let your profit go down the drainCalifornia Insurance Commissioner Dave Jones went against a unified front of labor and employer representatives siding with the insurance industry and the Workers’ Compensation Insurance Rating Bureau (WCIRB) in approving a 8.3% increase mid-year rate hike for California employers.  Added to the 37% rate increase he approved for January, July and later renewals are facing an average rate increase of 45.3% over last year at the same time.

Worker’s Comp and payroll taxes take a huge bite out of a contractors profit when working on Public Works construction projects – especially if the contractor is paying the full fringe benefit rate of the prevailing wage to the employee in cash and not to the Union Hall or into bona-fide plans.

Public Works Construction and Prevailing Wage projects require advanced financial planning methods and tools along with an understanding of the ever-changing compliance requirements — so that you can reduce your overhead and get paid on time.

Join Tim Blackwell of InsuranceDude.com, Steve Kuzmack of Fringe Benefit Experts, Bruce McFarland of L & R Tax Preparation, and Nancy Smyth of Sunburst Software Solutions, Inc. for a free, live 1 hour *Google+ hangout on Tuesday June 12, 2012 from 5-6 p.m. EST where we discuss easy to understand Worker’s Comp & Payroll Tax strategies for Public Works contractors, including:

  • determining if you are paying too much for your Worker’s Comp insurance
  • how to prepare for yet another increase in Worker’s Compensation premiums, if you are a contractor in California
  • how to lower labor costs by contributing the fringe benefit rate on prevailing wage jobs into bona-fide plans
  • complying with with certified payroll reporting requirements on Federal and/or State funded construction projects — including the impact of the new Compliance Monitoring Unit (CMU) and the filing of electronic certified payroll reports through MyLCM.
  • how the tax credits from the IRS may or may not come into play when the contractor does set up a health insurance plan

If you are interested in our webinar on Worker’s Comp & Payroll Tax strategies for Public Works contractors, circle me on Google + and watch for the Hangout announcement at 5 p.m. Eastern/2 p.m. Pacific/4 Central and join us.  Hangout’s can hold up to 10 people, if it’s full you can watch it live and ask questions by typing them in the comment section below the post.  This webinar will also be streaming live on my YouTube channel, where again you can ask questions by typing them into the comment section below the video.

Did you miss this live hangout?  Not a problem, watch a recording of it below and download the slides that were shown during the hangout by clicking here.

Please note, during the first section of the recording you will see a LOT of white space, unfortunately Tim’s webcam wasn’t working – but you’ll still be able to hear him speak.

YouTube Preview Image

ASA Seminar Payroll & Tax Strategies for Public Works Contractors

Print Friendly

 

ASA (American Subcontractors Association) San Diego Chapter Seminar on Payroll and Tax Strategies for Public Works Contractors, May 8, 2012 1:30 – 3:30 p.m. PST, $55.00 Members/$85.00 Non-members – register here.

I’m very excited to be working with Steve Kuzmack, President of Fringe Benefit Experts as we present a 2-hour seminar for the ASA San Diego Chapter on Payroll and Tax Strategies for Public Works Contractors.  Steve will be live, while I will be logging in remotely.  Come join us to learn:  Why cash is “KING”! and why Public Works Construction and Prevailing Wage projects require advanced financial planning methods and tools along with an understanding of the ever-changing compliance requirements — so that you get paid on time!

What You Will Learn

Learn How:

  • To reduce payroll taxes and insurance premiums on your prevailing wage projects in order to win more bids.
  • “Bona Fide” benefit plans operate and how they decrease labor costs while increasing company profits and enhance employee benefit programs.
  • You, the owner, can put more pre-tax money into your personal 401K.
  • To smooth out the wage discrepancies between Private and Public Work.
  • To generate more profit by eliminating $2.00 – $4.00 or more per hour in payroll burden – based on San Diego Wage Rates.
  • To be more competitive when submitting bids.

Learn about the Compliance Monitoring Unit and “electronic” Certified Payroll Reporting requirements:

  • What is a Certified Payroll Report?
  • How do I complete a paper Certified Payroll Report?
  • What is an electronic certified payroll report and how do I complete one?
  • Are there different requirements for State and Federally funded construction projects?
  • Can your payroll software program integrate with MyLCM and the CMU?

Learn about Certified Payroll Solution for QuickBooks:

  • Automatically generate prevailing wage, ARRA, EEOC/Work Utilization and Fringe Benefit Reports by extending the power of QuickBooks.
  • Electronically submit certified payroll reports to LCP Tracker, Hill International (MyLCM), Elation Systems and other labor compliance programs.

Learn About Types of “Bona Fide” Fringe Benefit Plans:

  • SUB Plan – “Field Workers Get Paid When Not Working” {Holidays, Layoffs, Reduction in hours}.
  • Pension Plan – How to Increase Owner and Staff Pre-Tax Contributions.
  • Health Plan – Make Health Insurance Premiums not only Pre-Income Tax but Pre-Payroll Tax as well.

Learn About Bookkeeping, Accounting, Payroll & Certified Payroll Reporting Procedures:

  • When you pay the full fringe rate as part of employees hourly rate of pay.
  • When you pay the full fringe rate to one or more “bona fide” fringe benefit plans.
  • When you pay a portion of the fringe benefit rate to a plan and the balance in cash.
Registration Information
Date: Tuesday, May 8, 2012
Time: 1:30 – 3:30 p.m.
Location: SMART Safety Offices,  9471 Ridgehaven Court #C, San Diego, CA  92123
Cost: $55 Members / $85 Non Members
REGISTER
About Your Host:

Nancy Smyth, Certified QuickBooks ProAdvisor

Nancy Smyth, Sunburst Software Solutions, Inc.
QuickBooks Construction & Payroll Expert


I've been using and supporting QuickBooks products since the early 1990's. I've worked with thousands of contractors, assisting them with QuickBooks setup, Certified Payroll Reporting requirements, AIA Billing and Weighted-Average Overtime.


QuickBooks is a powerful product, but learning how to use it in your construction business can be difficult. I hope you find resources available here to be helpful.

Search…….
Loading
Stay updated!

Sign up to receive our latest QuickBooks Tips, Tricks & News via email:


Enter your email address:

Delivered by FeedBurner


We promise NOT to sell, rent, or otherwise distribute your name and email address!

FREE 30-Day Trials

Request FREE 30-day Trials of QuickBooks add-ons for Certified Payroll, AIA Billing & Payroll Wage Management. Save time and increase accuracy on time-consuming error prone tasks; so you get paid on time!

Free 30 day trials of QuickBooks integrated add-ons for certified payroll, aia billing and weighted-average overtime

Certified Payroll Training:
Learn how to complete a Certified Payroll (Prevailing Wage) Report and fulfill your reporting requirements - 2 hour live webinar - $89.00 per person. Click here for more info.

certified payroll requirements webinar
QuickBooks Training

Frustrated with QuickBooks?

QuickBooks Premier ContractorLearn how to get the MAXIMUM possible results from QuickBooks in your construction business! Visit our new QuickBooks training website, Learn to use QuickBooks in your construction business.

QuickBooks Time Tracking


Save 10%/FREE 14-day trial!


QuickBooks Time Tracker