Step 1:
Go to the website of the California Department of Industrial Relations (DIR), specifically the prevailing wage rates section (linked above).
Step 2:
Select the project determination. If you are a subcontractor, this determination should have been relayed to you by the prime contractor or awarding body. There are two determinations issued each year for example: 2023-1 and 2023-2. Your wage determination will be used for the life of the project. If you have an older determination, click on the "superseded" option for an expanded list.
Step 3:
Locate your classification. It's very important to select the correct classification to avoid misclassification and underpayment penalties. The classifications are divided up into sections (Statewide, Northern California, Southern California, San Diego, and County). Each classification has a "SCOPE" that you can review to ensure your scope of work is covered by that classification. Some classifications such as Laborer or Operating Engineer have groups to review as well for you to identify and pull the correct rates.
Step 4:
View the Hourly Rates. Once you've located the correct classification (and group if applicable), you can know review the rates. The rates are separated by Basic Hourly Rates and "Fringes". Fringes are Health & Welfare, Pension, Vacation, Training, and Other. To calculate straight time, add the basic hourly rate and fringes together. Be sure to look at all footnotes as there might be calculation rules and hidden fees that also need to be incorporated in your calculation.
To calculate overtime, times the basic hourly rate by 1.5, and add in the fringes, taking into consideration any footnotes that need to be incorporated.
To calculate double time, times the basic hourly rate by 2, and add the fringes, taking into consideration any footnotes that need to be incorporated.
Training is the one fringe that is not typically paid to the employee but must be paid to a state approved apprenticeship hall or to the DIR CAC. When calculating your employee's hourly rates, subtract the training fringe.
There are circumstances as to when you are able to take "credit" for employer paid employee benefits to offset the prevailing wage rate, but that topic is for a different post.
Step 5:
Check to see if there are any predetermined increases for your classification. You can easily check at the top of the prevailing wage rates next to the expiration date there will be either one or two asterisks (*). One means there is no future increases and these rates are to be paid for the life of the project. Two means there is future increases.
If you go back to the classification selection menu, look for an "increase" link next to your classification. This will take you to the page with the increase dates outlined.
If the increase is not allocated (the total increase amount is not broken down by category: basic hourly rate, health and welfare, ect...) you will need to call the DIR to ask for the allocation so you know where to plug in the numbers. Once you get the allocation, add the dollar amounts in the applicable category and recalculate.
Step 6:
Check the travel, holidays, and shift pay provisions
Always be sure to check all of the information for each classification so you are aware of the classifications requirements.
Step 7:
Check the special notices to see if there were any released that apply to your determination and classification. This can be found on the DIR's prevailing wage homepage. There are times the DIR needs to make a correction to something they've already posted and instead of revising the page where the correction needs to be made, they will post it in the special notice section so another important tip - make sure you check to see if there are any that apply to you.
These steps are a basic overview of the CA state commercial prevailing wage rate calculation process. Should you need assistance, we are happy to help!
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