California Surveyors Forums

Can someone give me a reality check on the Department of Industrial Relations Public Works Contractor Registration requirements? If I'm reading the materials correctly, anyone who touches a public works contract, either as a bidder, a contractor or a subcontractor, is required to be registered with DIR. Registrations expire on June 30, and if not renewed ($300) by December 31 the penalty is $2,000.

I registered last spring, but forgot all about it until I got an email from DIR today. I just renewed to avoid getting hit with a penalty, but am I reading this right? Do land surveyors who work on PW projects really have to be PWC registered?

Thanks!

Jim,
If you work as a sub-contractor you have to be registered and pay the annual $300 fee (extortion). I got my invite from a contractor with whom I regularly work. The renewal is tricky, because there is no reminder. Suddenly you find yourself having to re-register.

Yes just another fee / toll / tax the private sector must cough up
you must also file electronically prevailing wage certs on line as well
as provide hard signed copies.
before July 2015 we paid $300, then after July 2015 we paid another $300.
$600 in less than a year.


Brian

Where does the money go?, what is it for? thats the question

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DWoolley

Owners do not have to pay themselves prevailing wage.

This one is a real thorn in my side. My most frequent PW client uses a commercial labor compliance application (LCPTracker) that has no provision for sole proprietors. I'm not an employee, I receive neither salary nor hourly wage nor benefits, yet I have to certify that I do in order to enter data into the system.

On a typical contract I spend 2 hours entering data and send in a benefit payment check of $20 or less.

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DWoolley

I am reasonably sure that you have to pay yourself an hourly wage for the prevailing wage work. Sole proprietor notwithstanding.

Telling a sole proprietor to pay himself an hourly wage is like telling him to go f**k himself -- no matter how much you might want him to do it, he can't do it.

A sole proprietor is not an employee. He doesn't receive a W-2. (Sole proprietor income is reported on Form 1040 Schedule C.) There are no paychecks, so there are no withholding taxes, FICA or Medicare deductions. (FICA and Medicare are addressed on Form 1040 Schedule SE.) He doesn't file a Report of New Employee (DE34). He's not an employee, so he can't be paid the prevailing wage, or any other wage!

I wouldn't be much of a businessman if I didn't make more the prevailing wage, but it seems to me that if a sole proprietor wanted to take a PW contract for free, there's no legal bar to his doing so as long as it's not a sham transaction. DIR might have a fit because they wouldn't be able to fit the square peg in the round hole, but I don't think they'd prevail in court on the matter. But as a practical matter, I wish they'd figure out how to deal with sole proprietors without making us certify to something that not only isn't true, but can't be true.

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DWoolley

"On a typical contract I spend 2 hours entering data and send in a benefit payment check of $20 or less."

So in addition to the $300 extortion fee there are additional fees depending on how many hours worked and paid to the DIR if you are a sole prop?

Dave, are you referring to project(s) still going on that started in 2011?

"Beginning on January 1, 2016, every contractor [surveyor] must provide electronic certified payroll records, into the eCPR system, for all public works projects defined by California Labor Code § 1720. This includes projects started before April 1, 2015. In fact, we have projects, dating back to 2011, that will now have to be entered into the eCPR system. "

What expiration/ renewal procedures are there for companies that might do a pubic works job once every 3 or 4 years. In other words you do one in 2016 then not another until 2020.

It's really extortion if you bid 2 or 3 a year but never get one. To pay a fee to bid a job that you don't get is a tax on zero income - is that legal?

Ms. Ayala added, “Further, contractors must certify, under penalty of perjury, the accuracy of the certified payroll reports.”

This is what chaps my behind. If I want to get paid on the contract I have to certify -- under penalty of perjury -- that I've paid myself wages and benefits that I haven't paid myself, because I CAN'T PAY MYSELF! (There's no actual transfer of funds when I write a check in my own name and then turn around and deposit it right back into the same account.) I even have to list a fictitious check number (I always use 0000).

Do not forget to send the Union hall $ per hour worked or you could get in hot water.

As we jump through more red tape and pay more fees its a wonder the whole system does not collapse
under its own weight.

I assume you have seen the required paper work for a contractor to bid on a 54K public works project.

Brian

So in addition to the $300 extortion fee there are additional fees depending on how many hours worked and paid to the DIR if you are a sole prop?

Contributions to the apprenticeship training fund have always been required; the rate is currently 77 cents per hour of field work in my area. You also have to request an apprentice, but the JAC won't actually dispatch one for short-term work.

This reeks of labor union protection. ~1990 using union wage scale for prevailing wage was challenged in court in the Central coast since only 2 or 3 companies were signatory and the non union companies won. IIRC that was when Welch Surveys went non union and laid everyone off. One of the companies was a husband and wife both licensed so the whole prevailing wage didn't affect them.

I did find this;
"Exemptions: As of April 1, 2015, and even after January 1, 2016, the following projects are exempt from the requirement to have contractors and subcontractors furnish certified payroll records (CPRs) to the Labor Commissioner:

Any projects monitored and enforced by the following legacy LCPs:

California Department of Transportation (Caltrans)
City of Los Angeles
Los Angeles Unified School District
County of Sacramento

I foresee the $300 fee rising dramatically in the near future. Govt employees can't review all that data for a measly $11million/year.

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DWoolley

Hopefully this conversation will become moot should the folks at NSPS be one day successful at getting surveying recognized as professional survices and not tradework. Unfortunately I see that as of December 2 the US Department of Labor Wage and Hour Division has issued a letter still refusing to budge on the issue. I doubt this will be the end of the fight by NSPS and I will support their efforts to push this on other fronts. Should they prevail, it follows there will need to be follow-up by us to get our own state's labor classifications and laws amended.

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DWoolley

I agree MR. Woolley the underground economy is dangerous and
should be stopped, I guess my beef is with the efficiency of yet another government
agency to implement or even monitor.
Would you agree the better approach for the DIR would have been to contract
with a private sector investigative service that is funded by steep fines then we petition the
district attorney for jail time from those who abuse the system? The idea here is to stop
abuse, if you put a % of these abuser’s in Jail together with loss of estate we should get compliance.
It’s possible that State could show a profit and the private sector gets some work and we,
those who follow the myriad of rules and regs, don’t get hit with another fee/ toll / tax.

I guess my point is if, say, “Amazon” was tasked with finding violators I bet within in year you would have compliance.

PS you all know the reason it costs 50k for jail in California. and 15k in Right tot Work States

Dave's justification for a "bidding fee" is pretty weak. I can see adhering to this policy IF you are awarded a contract but not before, or do you have to submit certified payroll for time spent bidding projects?

There are all kinds of scofflaws out there, govt employees that have a survey business on the side and do their research on the taxpayers dime thereby under bidding the non govt employed businessman, employers that demand a payroll kickback (which is more prevalent in the const industry then most care to admit) this bill won't catch that.

And forcing the sole proprietor to perjure himself is totally unjust and illegal. But why is it there, because, and I was told this by two union reps, the unions don't want owners in the field, they want them to hire people. It's a sad state when a private org (labor union) can buy legislation that forces a small businessman to either perjure himself or quit doing prevailing wage work and that's not what this Country is about. On that reason alone this bill should be deemed invalid.

I may have missed it, but I did a CLSA board search and found nothing on this bill.
I know there are others on here that are a LOT more into the legal aspects of surveying then I am, and as I age it interests me less, but I do try and at least skim articles that have large impact on our profession such as this one.
This bill has a MAJOR impact on our profession, it was passed 18 months ago and there was nothing on this board about it until this week.
Since the local military bases closed I have not engaged in any prevailing wage work and don't plan on it, but there is a high probability someone could have bid on a job without knowing they had to pay a "bidding" fee to some govt agency out to prove it's power using the "ignorance of the law is no excuse" to extort more money and put another license number on their briefcase.
Isn't one of the purposes of this board to keep the members informed? I am sure there are people on this board that knew about it, probably before it was passed into law. Do they have an ulterior motive for not informing the rest of us?

I first learned of this when a contractor -- Kiewit -- sent email to (I assume) everyone on their subcontractor's list in February saying that they will only be using registered subs. (I don't know if I've ever bid a Kiewit job, but somehow I got on their sub list.) I registered, but forgot or never knew about the June expiration.

Looking back through my email, I see that I got a notice from DIR at the end of September telling me that penalties for not renewing were going up on October 1, but apparently they didn't get enough response to that and extended through the end of the year. For some reason I ignored the September email, but the December one caught my eye and I renewed. Maybe the $2k penalty is a hollow threat, but I didn't want to take the chance.

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DWoolley