Certified Payroll Explained
Certified payroll is a payroll report submitted for federally funded projects of more than $2,000 under the Davis-Bacon Act (DBA). Enacted in 1931, the DBA ensures workers are paid a prevailing wage, preventing unfair labor practices during federal construction efforts.
The act, as currently amended, requires that any federal contractor or subcontractor who takes on federally funded job must pay their workers no less than the prevailing wage and fringe benefits paid on similar projects. Jobs include construction, alteration or repair (including painting and decorating) of public buildings or public works, including roadways.
Prevailing wage is the amount workers must be paid when working on government-funded projects. According to the Department of Labor, a contractor’s prevailing wage obligation may be met by either paying each laborer and mechanic the applicable prevailing wage entirely as cash wages or by a combination of cash wages and employer-provided bona fide fringe benefits.
Submitting certified payroll reports proves that you’re paying workers a prevailing wage. This reporting is crucial for companies offering payroll for contractors, especially in specialties like specialty trade payroll (e.g., electrical, plumbing, HVAC), where labor classifications and rates vary.
What Must Be Included in a Certified Payroll Report?
To submit a certified payroll, contractors working on federally funded projects should complete and submit Form WH-347 weekly to the US Department of Labor, demonstrating compliance with the DBA and related laws.
Contractors must collect employee information and fill out Federal Form WH-347, detailing:
- Employee name
- Employee address
- Worker ID#
- Job classifications
- Pay rates
- Daily AND weekly hours worked
- Gross wages
- Deductions
- Fringe benefits
Once completed, the form is certified by signing the statement of compliance.
Accurate recordkeeping is key—especially when handling multi-state payroll or navigating complex union payroll management obligations.
Simplify Reporting with Integrated Solutions
Submitting certified payroll reports can be complex. The DOL estimates that it will take an average of 55 minutes to complete data collection, including time for reviewing instructions, searching existing data sources, gathering and maintaining the data needed, and completing and reviewing the information. That’s where integrated payroll software designed for construction makes a difference.
With construction time tracking payroll solutions, like Arcoro’s Time Elite, employee hours and job classifications are automatically tracked daily, reducing your team’s collection burden. Accurate time tracking feeds directly into cloud-based payroll systems, streamlining calculations for jobs with multiple wage determinations, including those under both government and private funding in the same pay period.
Arcoro’s Payroll Advantage
Arcoro’s Time Elite offers built-in certified payroll reporting capabilities with Arcoro Payroll. Unlike generic providers, our construction payroll software is built to meet the unique challenges of the industry—from payroll tax filing to prevailing wage compliance and union payroll management.
The Certified Payroll report found in Arcoro Payroll allows you to generate the report in two formats:
- WH-347 -Form WH-347, as detailed above, is the typical report used to record employee information, hours, pay and deductions, allowing the government to verify proper fund usage and fair compensation. This form is ideal for those that only need to comply with federal reporting requirements.
- LCP Tracker – A format to help you upload payroll data into LCPtracker, a third-party software that flags, transforms and submits payroll data for federal and state compliance. LCPtracker is suitable for those who need to file with multiple agencies, including those requiring electronic submissions.
These reports are based on payroll data stored within Arcoro Payroll. Some templates may require additional information and data entry to complete the respective forms.
Whether you’re a general contractor or a specialty trade expert, Arcoro provides flexible construction payroll services that grow with your business—keeping your projects compliant, efficient and on budget.
Contact us for more information about Arcoro’s Time Elite or to schedule a free demo.
