Certified payroll: the complete guide

Certified payroll is a weekly report that contractors and subcontractors on government-funded construction must submit, verifying that every worker was paid at least the prevailing wage and fringe benefits required for their classification. It is a legal certification, signed under penalty, not just a payroll printout. On federal work it is governed by the Davis-Bacon Act and filed on Form WH-347, and most states run parallel rules on their own public works. This guide covers what it is, who files it, how the form works, when it is due, and the mistakes that turn into penalties.

What is certified payroll?

Certified payroll is a weekly submission that lists each worker on a covered project, their trade classification, hours worked, pay rate, gross wages, deductions, and fringe benefits, accompanied by a signed statement of compliance. The certification is the point: by signing, an officer of the company attests that the payroll is correct and that each worker received the required prevailing wage. It converts an internal payroll record into a document the government relies on to confirm workers were paid lawfully on public work.

The requirement exists because public construction is paid for with tax dollars, and the law wants to prevent contractors from winning bids by underpaying labor. Requiring a signed weekly wage report makes underpayment visible and creates a paper trail an auditor can follow.

Who has to file certified payroll?

Any contractor or subcontractor performing construction, alteration, or repair on a federally funded or federally assisted contract in excess of $2,000 must file certified payroll weekly under the Davis-Bacon Act, per 40 U.S.C. section 3142 and 29 CFR Part 5. The $2,000 threshold applies to the prime contract, so a small subcontractor on a large covered project is covered regardless of the size of its own scope. Most states impose their own certified payroll on state-funded public works, often at a lower threshold. California, for example, requires prevailing wage on public works over $1,000 under Labor Code section 1771.

What is the WH-347 form?

Form WH-347 is the U.S. Department of Labor Wage and Hour Division certified payroll form, OMB control number 1235-0008. It has two parts. The first is the payroll table: one row per worker per classification, with hours by day, total hours, rate of pay, gross earned, deductions, and net paid. The second is the Statement of Compliance, a signed attestation that the payroll is correct, that the required wage was paid, and that fringe benefits were paid into approved plans or as cash. The form is optional in the sense that you may use your own format, but the information it collects is mandatory, and many agencies require the WH-347 itself.

The columns that cause the most errors

• Classification: must match the work actually performed against the governing wage determination, not the worker's usual trade or title.
• Rate of pay: the base hourly rate, shown separately from fringe, because prevailing wage is base plus fringe and the two are checked independently.
• Fringe benefits: either paid into a bona fide plan or paid as cash in lieu, and either way the arithmetic has to reconcile to the determination.
• Hours: split correctly between straight time and overtime, using the right jurisdiction's overtime rule.
• Statement of Compliance: signed by someone with authority, matching the payroll it certifies, with fringe treatment stated consistently.

When is certified payroll due?

Certified payroll is due weekly. Under 29 CFR 5.5, a contractor must submit a weekly certified payroll for each week in which work is performed, and the WH-347 instructions specify submission within seven days of the regular pay date for that week. The obligation runs the entire time work is performed on the project, including weeks where the report shows no covered work if the agency requires a no-work payroll. Records must be preserved for at least three years after completion of the work on the prime contract, per 29 CFR 5.5(a)(3)(i).

What is the difference between certified payroll and prevailing wage?

Prevailing wage is the rate you must pay. Certified payroll is the report that proves you paid it. The prevailing wage for a project comes from a wage determination, a schedule of required base rates and fringe amounts by classification and locality, issued by the Department of Labor for federal work or a state agency for state work. Certified payroll is the weekly document that reconciles your actual payroll against that determination. You cannot produce correct certified payroll without the right wage determination, which is why reading the determination is a prerequisite, not a detail.

What is the statement of compliance?

The statement of compliance is the part that makes a payroll certified. It is a signed attestation, on the back of the WH-347 or its equivalent, by which an officer or authorized agent of the company certifies that the payroll is correct and complete, that each worker was paid not less than the applicable prevailing wage, and that fringe benefits were paid into approved plans or as cash as stated. It is signed under penalty of perjury, which is why falsifying certified payroll is a criminal matter, not just a compliance one. A report without a valid signed statement is not certified payroll, it is a wage table, and it does not satisfy the requirement.

Two choices on the statement trip people up. You must indicate whether fringe benefits were paid into a plan or paid in cash, and that election has to be consistent with how the payroll actually treated fringe. And the person signing has to have the authority to bind the company. A mismatch between the fringe election and the payroll, or a signature from someone without authority, undermines the certification even if the underlying wages were correct.

What are the penalties for getting it wrong?

Penalties come in layers. The baseline is back wages: the difference between what was paid and what was required, owed to the workers, which can reach back across the whole project. On federal work, willful or repeated violations can lead to debarment, a bar from bidding federal contracts for up to three years, and falsifying a certified payroll is a federal offense. States add their own. California can assess up to $200 per day per underpaid worker under Labor Code section 1775, on top of the wage differential. Because the same error usually repeats across many workers and many weeks, small per-line mistakes compound into large assessments.

How do you produce clean certified payroll?

1. Get the governing wage determination for the project and lock it, because the determination that applies is fixed by the contract, not the latest published version.
2. Classify each worker by the work actually performed, and pay base plus fringe for that classification.
3. Apply the correct overtime rules, including any state daily overtime, on the base rate.
4. Track apprentices against registration and the allowed ratio, and pay the journeyworker rate for hours outside the ratio.
5. File weekly, within seven days of the pay date, with a signed statement of compliance that matches the payroll.
6. Keep the full series of reports for at least three years after the prime contract is complete.

Done by hand, this is a weekly reconciliation across every worker on every job, and it is where compliance staff spend their days. Buildalytic reads the certified payroll and the governing wage determination together, checks classification, base, fringe, overtime, and apprentice ratios, and flags the exceptions before the report is filed, so the review is of the handful of problems rather than every line.