Verifying the accuracy of the certified payroll reports that you can generate from QuickBooks Premier and Enterprise versions – IF you also subscribe to Enhanced Payroll, is a must for anyone in the construction industry.
I’ve been watching the posts on the Intuit Community Forums about the alternate, substitute U.S. Department of Labor WH-347 certified payroll reports that can be generated if you have QuickBooks Premier or Enterprise AND an Enhanced Payroll Subscription. It seems like many people want to know how to generate the reports, if the reports are approved through the DOL (Department of Labor), why they have suddenly stopped working, how to issue “No Work Performed Reports”, and how to tell if the reports they are generating are accurate.
This article will focus on the requirements of the U.S. Department of Labor form WH-347 and how you can check to verify whether or not the reports from QuickBooks are accurate BEFORE you submit them – so that you will be paid in a timely fashion; we’ll be focusing on:
- Section 4 – Day & Date – Hours Worked Each Day
- Column 5 – Total Hours
- Column 6 – Rate of Pay
- Column 7 – Gross Amount Earned
- Section 8 – Deductions, and
- Column 9 – Net Wages Paid for Week
Columns 1-3 are pretty straight forward and each row of information relates to a single employee and a single Work/Trade Classification.
Section 4 – Day & Date – Hours Worked Each Day
In this section you are to report by day and date the number of hours (straight time and overtime) a specific employee worked, under a specific Work/Trade Classification on the job that you are generating the report for.
Column 5 – Total Hours
The total number of Straight and Overtime hours that the employee worked (for a specific Work/Trade Classification) for the week in question.
*Column 6 – Rate of Pay INCLUDING Cash Fringe Benefits
In the “straight time” box for each worker, list the actual hourly rate paid for straight time worked, PLUS cash paid in lieu of fringe benefits paid. When recording the straight time hourly rate, any cash paid in lieu of fringe benefits may be shown separately from the basic rate. For example, “$12.00/.40″ would reflect a $12.00 base hourly rate plus $0.40 for fringe benefits. When overtime is worked, show the overtime hourly rate paid plus any cash in lieu of fringe benefits paid in the “overtime” box for each worked or “$18.00/.40″. This is one of the biggest faults of the certified payroll report generated by QuickBooks – if you pay the fringe benefit rate in cash to the employee as part of his/her hourly rate of pay you MUST manually update this information each week.
Column 7 – Gross Amount Earned this Job and ALL Jobs
Enter gross amount earned on this project. If part of a worker’s weekly wage was earned on projects other than the project described on this payroll, enter in column 7 first the amount earned on the Federal or Federally assisted project and then the gross amount earned during the week on all projects, thus “$163.00/$420.00″ would reflect the earnings of a worker who earned $163.00 on a Federally assisted construction project during a week in which $420.00 was earned on all work. These amounts can easily be verified by looking at the Employee’s Paycheck Detail in QuickBooks.
Section 8 – Deductions
Five columns are provided for showing deductions made from the employee’s paycheck. If more than five deduction are involved, use the first four columns and show the balance deductions under “Other” column; show actual total under “Total Deductions” column; and in the attachment to the payroll describe the deduction(s) contained in the “Other” column. All deductions must be in accordance with the provisions of the Copeland Act Regulations, 29 C.F.R., Part 3. If an individual worked on other jobs in addition to this project, show actual deductions from his/her weekly gross wage, and indicate that deductions are based on his gross wages. These amounts can easily be verified by looking at the employee’s Paycheck Detail in QuickBooks. Remember, ONLY deductions from the employee’s paycheck are to be reported here – Federal Withholding, State Withholding, the Employee portion of FICA and Medicare, Child Support, Wage Garnishments, etc.
Column 9 – Net Wages Paid
This amount should equal the employee’s NET paycheck for the week and should match exactly the amount of his/her paycheck.
——————————————————————————————–
If your final QuickBooks certified payroll report doesn’t look like this wh347, it’s time to opt for a more accurate and less time-consuming option that will truly automate the process for you.
——————————————————————————————–
Many people generate the QuickBooks Certified Payroll report and either manually make changes in it while it is still in Excel, prior to printing the report OR they will print the report and then use it as a guideline for manually completing the actual “fillable report” from the U.S. Department of Labor Website – which is a highly error prone and time-consuming process.
Additionally, QuickBooks does not have the ability to generate a “No Work” performed payroll, so if you need one, and it’s likely that you will, you’ll need to manually complete one of these also using the fillable form from the DOL website.
Manual entry of the same information multiple times in multiple places is a huge waste of time and let’s face it, every time that you have to enter the same information in yet another place the higher the risk of transposition errors which result in rejected reports and delayed payment.
——————————————————————————————–
*Fringe Benefits that are paid to a Union or a bona-fide plan are NOT displayed on the report and the Straight time rate would be displayed as $12.00 and the Overtime rate as $18.00 in the Rate of Pay Column. The certified payroll report generated by QuickBooks inaccurately displays any fringes paid to a Union or bona-fide plan and you MUST manually correct this each week.
We hope you have found this article helpful, if so please leave us a comment.
Taking a Health Insurance credit against the full prevailing wage fringe benefit and reporting it correctly on the Federal WH-347 Certified Payroll Report can be very confusing. This question was asked by a reader who recently requested our 4 Ways Contractors Pay Prevailing Wage Fringe Benefits eBook.
This is an issue that has been extensively belabored in our office (by me).
We are an open shop, but sometimes do jobs with a union agreement. We do a lot of prevailing wage jobs and private work.
We offer all of our employees health insurance – the company paying 75% of the monthly premium and the employees paying the remaining 25% through employee deductions.
It gets so confusing and reading all the blogs etc. does not clarify it for me. I must be slow 
How can I be sure that I am correctly accounting for this?
Constantly confused…. Thank you
————————————————————————————————————–
Taking a Health Insurance credit against the full prevailing wage fringe benefit IS confusing, it’s NOT just you.
From what “I” know (and realize that I’m in Vermont and know enough about prevailing wage rules & regulations to be dangerous – I may not know all the fine print for your specific state). I will explain what I know and you should then verify it with the Prevailing Wage Unit of your local Department of Labor just to make sure.
First you are going to need to determine what the monthly company contribution is for each employee, and for the sake of the rest of this example; let’s assume that we have an employee named Frank and your company pays $173.33 a month toward his health insurance.
Step 1 – Take the $173.33 -> multiply it by 12 = this equals the annual maximum company contribution ($2,079.96).
Right click on the image to enlarge it.
Step 2 – Take the annual company contribution ($2,079.96) and divide it by 2080 hours -> this will give you an “hourly credit” of $0.99 – remember as far as prevailing wage fringes go everything is based on an hourly rate.
Right click on the image to enlarge it.
In QuickBooks edit Frank’s employee record -> going to the Payroll and Compensation tab -> in the Additions, Deductions and Company Contributions block, find the health insurance contribution item and enter BOTH the hourly “rate” and the annual maximum.
So now let’s say that Frank is classed as a Flagger making $11.15 per hour and the full fringe package is $4.40 per hour and based on your calculations above he has a $1.00 per hour company paid health insurance contribution. In QuickBooks his rate of pay becomes $14.55 ($11.15 base PLUS $3.40 cash fringe).?
When you generate your Federal WH-347 certified payroll report you will want to pay special attention to Column 6 – Rate of Pay/Cash Fringes. Here you will want to report $11.15 (base rate)/$3.40 (balance of fringe benefit rate paid in cash).
Right click on the image to enlarge it
On the Statement of Compliance you will want to check BOTH boxes 4a – Fringe Benefits paid to approved plans, funds or programs AND 4b – Fringe Benefits are paid in cash.
Right click on the image to enlarge it
Important Notes:
- 2,080 hours is a construction industry standard number of work hours per year. It is based on 40 hours per week in a 52 workweek period.
- You’ll want to edit BOTH the company contribution and employee deduction payroll items and indicate that each has an annual limit in order for QuickBooks to automatically stop withholding when the annual limits have been reached.
- On a weekly basis, both the company contribution and employee deduction should be calculated based on the TOTAL number of hours the employee worked on BOTH private and prevailing wage jobs.
- When the company’s annual contribution limit has been reached you will want to “add” the credit back to the employee’s hourly rate of pay for the balance of the year.
- You’ll need to perform these calculations each time health insurance premiums change.
______________________________________________
Screenshots of the WH-347 Certified Payroll Report and Statement of Compliance were taken from actual reports that were generated using Certified Payroll Solution and QuickBooks data. Learn more about Certified Payroll Solution by clicking here.
Learn more tips like this by signing up for our 2 hour “How to Fulfill Your Certified Payroll Reporting Requirements” webinar.
How to Fulfill Your Certified Payroll Requirements Webinar – Associated Builders & Contractors, Inc. Merit Choice
Date: Wednesday, November 17
Time: 2 p.m. (ET) / 1 p.m. (CT) / 12 p.m. (MT) / 11 a.m. (PT)
Length: 90 minutes
Fee: Free for ABC members
Speaker: Nancy Smyth, President of Sunburst Software Solutions
For more information or to register, visit http://www.abc.org/Hot_Links/Meetings_and_Events/Webinars/2.aspx
Join ABC Merit Choice for a complimentary webinar on certified payroll!
Learn everything you need to know to fulfill your certified payroll requirements in the most compliant and efficient manner.
- What government agencies make the laws behind certified payroll reporting requirements?
- How to comply with labor standards and payroll reporting requirements
- How to complete a Certified Payroll Report and Statement of Compliance
- Common methods for creating Certified Payroll Reports, Statements of Compliance, EEOC and Fringe Benefit Reports
- State prevailing wage vs. Davis-Bacon forms and which form applies
- Ways contractors pay fringe benefits and how to document the credit you can take
- Tracking employee time and work classifications
- Requesting additional “trade/work classifications” and wage rates
- Typical errors that require correction
- What happens when things go wrong
Who Should Attend
- Owners
- Estimators
- Controllers
- CFOs
- Payroll processors
- Office managers
- Business development experts
About the Speaker
Nancy Smyth, President of Sunburst Software Solutions, has helped over 4,000 contractors learn about their certified payroll requirements, automate their processes and stay compliant with all of their certified payroll, statement of compliance and EEOC requirements. Sunburst Software Solutions, Inc. provides fully integrated, time saving solutions for certified payroll, AIA Billing, and payroll wage management for contractors using QuickBooks. www.Sunburstss.com
We’ve been testing, debugging, and documenting numerous certified payroll and AIA billing updates for the last few weeks – I’ve posted some of the information behind the changes here in our blog.
Today, I just send out a newsletter to over 2,000 construction companies (in all 50 states) who use our software – Glad I use Constant Contact to keep everyone up to date, otherwise they would get me for spamming 
Below are highlights from the newsletter.
Certified Payroll Solution Updates:
There are several new enhancements, changes, and requirements available for Certified Payroll Solution; some at the State level for certified payroll reporting and others at the Federal level for EEOC Reporting – each item has a link to our website where you will find complete instructions. Be sure to visit our website to obtain the instruction on how to download & install the updates and implement any new changes that you will need to make.
- California DIR established Compliance Monitoring Unit and requires electronic certified payroll reports via a Labor Compliance Program (LCP) developed by TRS Consultants, Inc. Click here for details.
- New FHWA 1391 & 1392 Annual EEO Reports for Federal Highway Contractors – the U.S. Department of Transportation Federal Highway Administration revised both the 1391 & 1392 in June 2010. The new forms print on LEGAL SIZE paper and require that you report employees who are of two or more races separately. Click here for details.
- Texas DOT Requires Electronic Certified Payrolls {E-Payrolls} – The Texas Department of Transportation, like many other state agencies, is requiring electronic submission of certified payroll reports, through its Electronic Project Records System (EPRS). We have worked closely with representatives of Texas DOT to ensure that CPS will create the required .CSV file. The electronic upload has been tested and approved by Texas DOT. Click here for details.
- Revised Mississippi CAD-880 & CAD-881 Forms – Mississippi Department of Transportation (DOT) has revised their CAD-880 & CAD-881 Forms and updated forms are available to download. The Certified Payroll Report now includes the Race & Gender of each employee. Click here for complete details.
- New York City Housing Department Form Update – The New York City Housing Department is requiring that ALL certified payroll reports submitted on the Federal WH-347 form include the”Public Burden Statement”. Click here for complete details.
- Wisconsin Bug Fixes – corrects DOT Statement of Compliance check boxes and Department of Workforce Development Electronic upload error. Download CPS Version 5.0.440 and then download Wisconsin DOL forms.
- More Missouri revisions – including the ability to print the certified payroll report forms on either standard or legal-sized paper. Download CPS Version 5.0.440 and then download new State of Missouri forms.
- Alaska Electronic Certified Payroll Upload News – Over a year ago we were contacted by the Alaska Department of Labor & Workforce Development to provide an electronic upload for their new on-line certified payroll filing. We worked closely with them to provide them with the correct information and upload type. A couple of weeks ago, we were contacted again and the system is now live. Download this brochure from the Alaska Department of Labor & Workforce Development, download this article for setting up CPS to generate the required files.
Construction Application for Payment Solution (AIA Billing Updates)
We’ve also been working on the Construction Application for Payment Solution (for AIA Billing). We’ve added new functionality and forms that have been requested by YOU, our customers. Each new item is listed below, if there are “special” instructions for implementing the new feature – be sure to click the link to visit our website and download ALL of the download & setup instructions that are available.
- Quantities on the Continuation Sheet – Currently this is a tested ALPHA release (Version 5.0.219), which provides Quantity Tracking (estimated, previous, current, stored, previously stored quantities and unit price can be tracked and printed with CAPS). New forms have been added with quantities. In some cases, prior form selection on jobs may be incorrect – check the Form Printing Options for each Job (Edit menu -> Jobs -> select Job -> Edit -> Printing tab -> check selection in the Select a plain paper form for this job. CAPS now provides 22 different plain paper invoicing formats for you to choose from.
- Contractor Qualification Statement – In April we released in BETA a Contractor Qualification Statement as part of the Construction Application for Payment Solution Program. Some, but not all of you have downloaded this update (Version 5.1.214) and it is currently in BETA until we hear more feedback from you.
- Plain Paper 706, 706A, 707 & 707A forms – In March, we released in BETA the ability to create complete 706, 706A, 707, & 707A forms using plain paper – rather than having to purchase AIA originals. Some, but not all of you have downloaded this update (Version 5.0.184) and it is currently still in BETA until we hear more feedback from you.
The Texas Department of Transportation, like many other state agencies, is requiring electronic submission of certified payroll reports, through its Electronic Project Records System (EPRS).
TxDOT EPRS provides contractors with multiple functions which they can utilize; however, one of the primary functions of the EPRS is that of collecting Electronic Certified Payrolls (E-Payrolls), instead of requiring contractors to submit paper certified payroll report forms for review.
E-Payrolls may be uploaded into the EPRS from a contractor’s computer IF they have the proper information, in a specific data order, and it is a .CSV file format – otherwise the contractor will have to take his printed paper certified payroll report and manually input it in the EPRS System.
Some software companies are updating their payroll systems to provide their construction clients with the ability to create electronic output files, such as the .CSV file required by TxDOT, in addition to printing a standard paper report for the contractor to keep in his job file. However, the problem for the software companies is that there is no standard output file that is used consistently and each state or agency wants the electronic file to not only contain ALL of the information that is required on their “paper form” but include additional information as well.
For example:
- Texas Department of Transportation requires a .CSV file
- Elation Systems, Inc. requires an XML file
- TRS Consultants, Inc. requires an XML file
- LCPtracker requires an .XLS file
- Sandia National Laboratory requires an XML file
- Alaska Department of Labor & Workforce Development requires a .TXT file
- Wisconsin Department of Transportation requires an XML file
- Wisconsin Department of Workforce Development requires an .XLS file
Some computer savvy contractors create a “master” certified payroll reporting form (based on the requirements of the State agency that they must submit them to) in Excel, manually input the payroll data each week and attempt to “save” it in any of the above mentioned file formats listed above – only to discover that the file is rejected and they have to log and manually type the information into the Labor Compliance System.
___________________________________________
Certified Payroll Solution, a QuickBooks integrated application, will read your QuickBooks payroll data and generate paper forms and/or all of the required electronic upload formats noted above – included the format required by the Texas Department of Transportation .CSV format (this functionality will be released via a program update on 7/30/2010 and has been thoroughly tested by TxDOT).
Request a FREE 30-day trial to see for yourself.
