As I’ve mentioned in previous articles, the public works laws have made some big changes in compliance requirements over the last few years. Unfortunately for us contractors, most of these new regulations are additions to the existing laws and have not removed the old requirements.
Over the years the DIR has tried several versions of the “electronic certified payroll system” the newest version is no different from the past. While the Labor Commissioner wants contractors to only submit electronically filed certified payroll reports to them through their website, it is extremely important for contractors and subcontractors to understand that submission of ECPR’s is a requirement separate and distinct from the obligation already found in other parts of the Labor Code which provide CPR’s be made available to the Awarding Body, its representative, the DLSE, Labor Management Groups and the public.
While CPR requests from the public are not as rampant as they were just two years ago, we still receive them at least every other month from a labor management group or union (in fact, I have one sitting on my desk right now.). This request was sent to the awarding body and the prime contractor (and if unresponsive, to the DLSE). The district we are currently working for requires us as the prime contractor to fulfill the requirements of the request in the allotted time frame. Without the Form A-1-131, we would not have time to fully review and redact confidential information as required to comply with these requests.
Below is a Q&A that better explains who can request copies of certified payroll reports, what forms need to be used and links to the current Labor Code that gives more detail for each.
Question: Who do I submit my certified payroll reports to?
Answer (part 1 of 7): To the Labor Commissioner through the DIR’s ECPR system.
Labor Code Section 1771.4(a)(3) requires every contractor/subcontractor to furnish “the records specified in Section 1776 directly to the Labor Commissioner.”
Format to submit payroll: The format prescribed by the Labor Commissioner is found on the DIR’s website it is currently the ECPR (Electronic Certified Payroll Reporting) system. It specifies that contractors and subcontractors on most public works projects must electronically submit certified payroll records (CPRs) by following the specific online instructions. This system enables the Labor Commissioner to constantly monitor and have access to CPR’s without the need for written requests or formal investigations, based solely upon the eCPRs submitted.
So there can be no confusion, all contractors must comply with the above ECPR requirements but the submission of ECPR does not fulfill their obligation to CPR requests from the Awarding Body, its representative, the DLSE, Labor Management Groups and the public as mentioned below.
While the ECPR’s contain the rates being paid, they do not contain all of the payroll information and records which may be required for a contractor to comply with these requests.
- Under California Code of Regulations (8 CCR 16401(b), “the format for reporting of payroll records requested pursuant to Labor Code Section 1776” is a form identified in the regulation as Form A-1-131 which is available at any office of the Division of Labor Standards Enforcement throughout the state.
- The regulation also provides: “Acceptance of any other format shall be conditioned upon the requirement that the alternate format contain all of the information required pursuant to Labor Code Section 1776.”
- As noted above, the prescribed format for eCPRs does not include all of this information.
- The information not available in eCPRs but which is required in Form A-1-131 submissions includes: work classifications, gross amounts earned each week, itemized deductions or contributions for federal taxes, state taxes, state disability insurance, vacation or holiday pay, health and welfare benefits, pension, union dues, if any, travel and subsistence, and savings
Answer (part 2 of 7): To the Awarding Bodies representative
Labor Code Section 1776(b)(2)(a) “shall be made available for inspection or furnished upon request to a representative of the body awarding the contract…” Not all awarding bodies request copies of the certified payroll, but you should check your contract to see what they require, legislation requires they be available at least “monthly or more frequently if specified in the contract with the awarding body” (Labor Code Section 1771.4(a)(3)(A)), and in “a format prescribed by the Labor Commissioner” (Section 1771.4(3)(B)).
Answer (part 3 of 7): To the General Contractor
The general/prime contractor is directly in contract with the awarding body; the subcontractors are in contract with the general/prime contractor. The general contractor and the subcontractors are jointly and severally liable to a subcontractor’s employees for any wage rate deficiencies unpaid by the subcontractor. Labor Code 1775 (C)(2) requires the general contractor to review the certified payroll reports of their subcontractors. Crosschecking certified payroll reports with field reports to ensure that all employees on site are accounted for and are paid the correct prevailing wage rate, fringes, per diems, etc.
Answer (part 4 of 7): To the DLSE Division of Labor Standards Enforcement
Labor Code Section 1776(b)(2)(a) “shall be made available for inspection or furnished upon request to… the Division of Labor Standards Enforcement of the Department of Industrial Relations” (Labor Code Section 1771.4(a)(3)(A)), and in “a format prescribed by the Labor Commissioner” (Section 1771.4(3)(B)).
All the above reports require unredacted Form A-1-131 including; “…accurate payroll records, showing the name, address, social security number, work classification, straight time and overtime hours worked each day and week, and the actual per diem wages paid to each journeyman, apprentice, worker, or other employee employed by him or her in connection with the public work.”
In reference to requiring the full social security number, Labor Code 1776(a) still requires it:
- Labor Code § 226(a), which sets forth certain record keeping requirements for employers, limits an employer’s obligation to provide only the last four digits of employees’ social security numbers. Labor Code § 1776(a) has not been so amended and requires the inclusion of the full social security number. For enforcement purposes, however, it should not be considered by the DLSE as a violation of Labor Code § 1776 warranting the issuance of a CWPA if a contractor makes available for inspection, or furnishes upon request, the full social security number for all affected employees on a separate written report, signed under penalty of perjury, to the entities identified in 1776(b)(2) within the time limits specified in Labor Code 1776. These entities include a representative of the body awarding the contract, the DLSE, and the Division of Apprenticeship Standards (DAS).”
Answer (part 5 of 7): To the public
Labor Code Section 1776(b)(3) “A certified copy of all payroll records enumerated in subdivision (a) shall be made available upon request by the public for inspection or for copies thereof. However, a request by the public shall be made through either the body awarding the contract or the Division of Labor Standards Enforcement.”
Format to submit payroll: Form A-1-131 submissions includes: all requirements per Labor Code Section 1776(a) *”…shall be marked or obliterated to prevent disclosure of an individual’s name, address, and social security number.” Labor Code Section 1776(e)(f)
Answer (part 6 of 7): To Joint Labor-Management Committee
In addition to “To the public” Labor Code Section 1776(e)(f) “Any copy of records made available for inspection by, or furnished to, a joint labor-management committee established pursuant to the federal Labor Management Cooperation Act of 1978 (29 U.S.C. Sec. 175a)”
Format to submit payroll: Form A-1-131 submissions includes: all requirements per Labor Code Section 1776(a) *”…shall be marked or obliterated to prevent disclosure of an individual’s social security number only.”
Answer (part 7 of 7): To a multiemployer Taft-Hartley trust
In addition to “To the public” Labor Code Section 1776(e)(f) “a multiemployer Taft-Hartley trust fund (29 U.S.C. Sec. 186(c)(5)) that requests the records for the purposes of allocating contributions to participants”
Format to submit payroll: Form A-1-131 submissions includes: all requirements per Labor Code Section 1776(a) *”…shall be marked or obliterated to prevent disclosure of an individual’s full social security number, but shall provide the last four digits of the social security number.”