What Is Certified Payroll? A Contractor's Guide (2026)

Winning a public construction job changes how you run payroll. On a project funded or assisted by the federal government, you must pay every laborer and mechanic at least the local prevailing wage for their trade, pay them weekly, and prove it every week with a signed report called certified payroll. Get it wrong and the agency can hold back your contract payments.

This guide explains what certified payroll is, which projects need it, where the wage rates come from, how fringe benefits count, and how to fill in and submit Form WH-347, step by step. Facts are from the U.S. Department of Labor (DOL) and were checked on October 6, 2026.

This is general information, not legal or tax advice. Your contract and the contracting agency’s instructions control what applies to your project.

What certified payroll is

Certified payroll is a weekly payroll report for a covered public construction project. For each worker it shows their job classification, hours worked each day and week, pay rates, gross pay, deductions and net pay. It comes with a signed Statement of Compliance, in which you certify that:

the payroll information is correct and complete, and you keep the required records;
each worker was paid their full weekly wages, with no deductions other than those the rules allow;
each worker was paid at least the wage rate and fringe benefits listed for the classification of work they actually performed.

The DOL publishes an optional form for this, Form WH-347 (Davis-Bacon and Related Acts Weekly Certified Payroll Form). You can use another format, but the Statement of Compliance must have identical wording. The DOL also offers a free WH-347 web tool that calculates wages and prints a ready-to-submit form.

The Davis-Bacon Act applies to every federal government or District of Columbia contract over $2,000 for the construction, alteration or repair (including painting and decorating) of public buildings or public works.

Many other federal laws that fund construction through grants, loans, loan guarantees or insurance carry the same labor standards. These are the Related Acts. Examples the DOL lists include the Federal-Aid Highway Acts, the Housing and Community Development Act of 1974 and the Federal Water Pollution Control Act. Together they are called DBRA (Davis-Bacon and Related Acts).

On a DBRA project you must:

pay laborers and mechanics working on the site at least the prevailing wage, including fringe benefits, for all hours worked;
pay them weekly;
submit certified payroll every week;
post the wage determination and the Davis-Bacon poster (WH-1321) where workers can easily see them.

The Copeland “Anti-Kickback” Act also applies. It bars you from pressuring workers to give back any part of their pay, and it is the source of the weekly statement of wages.

Who counts as a laborer or mechanic? Workers whose duties are manual or physical. Supervisors such as forepersons who spend more than 20% of their week on manual work, and who are not exempt executives or professionals, must be paid the prevailing wage for that time.

Prevailing wage and wage determinations

The prevailing wage is the minimum the DOL has found is paid in a given area for a given trade and type of construction (building, residential, highway or heavy). It has two parts: a basic hourly rate and, for many classifications, a fringe benefit rate. Both are minimums.

These rates are published in a wage determination, a list of classifications and rates for one area and construction type. Where to find yours:

In your contract. The contracting agency must include the applicable wage determination in the bid documents and contract. Subcontractors should ask the prime contractor or the agency for it.
On SAM.gov. Since June 14, 2019, Davis-Bacon general wage determinations have been published on SAM.gov, where you can search by wage determination number or browse by category, and follow a determination to hear about revisions.

The determination in your contract generally stays fixed for the life of the contract, with exceptions such as option periods or out-of-scope changes. If a trade you need is missing from it, you request a conformance, which adds the classification and a rate for your contract only. A conformance is not valid until the DOL’s Wage and Hour Division approves it.

How fringe benefits count

You can meet the prevailing wage with any mix of cash and bona fide fringe benefits (contributions to real benefit plans such as health insurance, pensions or paid leave). If the determination lists $34.00 plus $21.00 in fringe, you could pay $55.00 an hour in cash, or $34.00 in cash plus $21.00 in plan contributions, or another combination that adds up.

Two rules catch contractors out:

Legally required payments do not count. Social Security, unemployment insurance and workers’ compensation are required by law and cannot be credited as fringe benefits.
Annualization. If your workers also do private, non-covered work, you generally must spread the cost of a benefit over all the hours the worker works in the year, not just the Davis-Bacon hours. You divide the annual cost by total annual hours to get the hourly credit you can claim.

Overtime on covered projects

The Contract Work Hours and Safety Standards Act (CWHSSA) applies to many covered contracts. It requires at least one and a half times the basic hourly rate for hours over 40 in a workweek. The overtime premium is figured on the basic rate, not on the fringe benefit. If you miss it, you owe back wages plus liquidated damages for each worker for each day of violation. The DOL lists the current inflation-adjusted amount as $33 per day for penalties assessed on or after January 16, 2025.

Worked example: one week for one electrician

Here is how the numbers come together. The rates below are invented for the example; use the ones in your own wage determination.

Wage determination for Electrician: $30.00 basic hourly rate + $15.00 fringe = $45.00 prevailing wage.
You pay for the worker’s health insurance. It costs $9,360 a year, and the worker works 2,080 hours a year across all your jobs. Annualized credit: $9,360 ÷ 2,080 = $4.50 an hour.
Fringe still owed: $15.00 − $4.50 = $10.50 an hour, which you pay as cash.
Cash hourly rate: $30.00 + $10.50 = $40.50.
The electrician works 44 hours on the project this week.

Line	Calculation	Amount
Straight-time cash pay	44 hours × $40.50	$1,782.00
Overtime premium (CWHSSA)	4 hours × 0.5 × $30.00 basic rate	$60.00
Gross cash wages on WH-347		$1,842.00
Fringe credited through health plan	44 hours × $4.50	$198.00
Total value paid	equals 44 × $45.00 + $60.00	$2,040.00

On the WH-347 you would list the worker under Electrician, record hours by day, show the $40.50 cash rate and the fringe paid to the plan, then the gross pay, tax withholdings and other deductions, and net pay. Normal payroll taxes still apply to the cash wages.

How to do certified payroll, step by step

Confirm coverage. Check your contract for Davis-Bacon labor standards clauses and the wage determination. If you are a subcontractor, get both from the prime contractor.
Map every worker to a classification. Classify by the work actually performed, not by job title. If someone does two trades in a day, record the hours in each.
Request conformances early. If a trade you need is not on the determination, ask the contracting officer to submit a conformance request before the work starts.
Work out your fringe credits. List each bona fide benefit, annualize the cost where required, and decide how much of the fringe rate you will pay in cash.
Track time by day and classification. Daily and weekly hours by classification are what the report needs and what investigators check first.
Pay weekly. Covered workers must be paid at least once a week, at no less than the prevailing rate, with overtime where CWHSSA applies.
Complete the WH-347 (or an equivalent with identical certification wording) for the week.
Sign the Statement of Compliance. It must be signed by you or an authorized person who pays or supervises payment of the workers, with a handwritten or legally valid electronic signature.
Submit within 7 days of the regular pay date. On Davis-Bacon contracts the prime contractor submits all payrolls, including subcontractors’, to the contracting agency. On Related Act projects it usually goes to the state or local agency administering the funds. Many agencies use an electronic system; follow theirs.
Post and keep records. Keep the wage determination and the WH-1321 poster posted on site. Keep payrolls and basic records for at least 3 years after all work on the prime contract is completed.

State and local prevailing wage programs

Federal rules are only half the picture. Many states and some cities have their own prevailing wage laws for projects they fund, with their own rates, classifications, forms and submission portals. A project can be covered by both federal and state rules at once.

California is a good example of how different a state program can be: contractors and subcontractors on most public works projects must submit certified payroll records online to the Labor Commissioner through the Department of Industrial Relations (DIR) website, and those records are publicly searchable with confidential details removed. Other states use paper forms, third-party systems or different deadlines. Before you bid, check the labor department of the state, and the city or agency, funding the job.

Penalties for getting it wrong

According to the DOL, the consequences can include:

Withheld payments. The agency can withhold enough from your contract payments to cover unpaid wages and CWHSSA liquidated damages.
Termination and cost liability. Violations can be grounds for terminating the contract, and you can be liable for resulting costs to the government.
Debarment for 3 years. A debarred firm and its responsible officers cannot work on federal or DBRA-covered contracts during that time.
Prosecution for false certification. Falsifying the Statement of Compliance can lead to civil or criminal prosecution under 18 U.S.C. 1001 and 31 U.S.C. 3729.
Subcontractor liability flows up. The prime contractor can be held liable for unpaid wages owed to workers of its subcontractors.

Common mistakes

The DOL lists these as frequent compliance problems on DBRA projects:

Misclassifying workers, for example paying an electrician’s work at the laborer rate.
Not paying full prevailing wage for all hours, including fringe and overtime hours.
Incomplete records, such as missing hours or not splitting the day when a worker did two classifications.
Using apprentices who are not individually registered in an approved program, or exceeding the allowed apprentice ratio. Unregistered “apprentices” must be paid the full rate for the work they did.
Missing weekly submissions.
Not posting the wage determination and the Davis-Bacon poster on site.

Two more to watch, both from the fringe benefit rules above: counting legally required payments such as workers’ compensation as fringe benefits, and taking fringe credit without annualizing when the same workers also do private work.

Tools that help

You can produce certified payroll by hand with the DOL’s WH-347 web tool, but it gets tedious with more than a few workers or projects. Payroll software built for construction can track time by job and classification, apply wage determination rates, annualize fringe and output WH-347 or state formats.

Best Construction Payroll Software (2026) compares options, including tools with certified payroll built in.
Best Accounting Software for Construction covers job costing, which certified payroll feeds.
New to payroll in general? Read How to Run Payroll Yourself.

Frequently asked questions

What is certified payroll?

Certified payroll is a weekly payroll report that contractors and subcontractors on federally funded or assisted construction projects must submit. It lists each worker, their job classification, hours, pay rates, deductions and net pay, and comes with a signed Statement of Compliance certifying that everyone was paid at least the prevailing wage. Most contractors use the Department of Labor's optional Form WH-347.

How often do you submit certified payroll?

Weekly, for every week in which covered work is performed. Under the federal rules, each certified payroll is due within 7 days after the regular pay date for that payroll period. On Davis-Bacon contracts the prime contractor submits all certified payrolls, including subcontractors', to the contracting agency.

Where do I find the prevailing wage rates for a project?

The applicable wage determination is part of your contract or bid documents. The contracting agency includes it, and subcontractors should get it from the prime contractor or the agency. Federal Davis-Bacon general wage determinations are also published on SAM.gov.

What happens if certified payroll is wrong?

Contract payments can be withheld to cover unpaid wages, and violations can lead to contract termination and debarment from federal contracts for three years. Falsifying the Statement of Compliance can bring civil or criminal prosecution under 18 U.S.C. 1001 and 31 U.S.C. 3729.

Do state public works projects require certified payroll too?

Many do, under state prevailing wage laws that have their own rates, forms and deadlines. California, for example, requires contractors on most public works projects to submit certified payroll records online to the Labor Commissioner. Check the rules of the state or city that funds the project.

Sources and updates

Facts in this article were last checked against the official sources below on Oct 6, 2026. Rules and thresholds change, so confirm anything you act on with the official source or a qualified professional. Spot something out of date? Tell us and we will re-check it. How we work: editorial policy.