At a Glance
Quick Answer
California has an active prevailing wage law (California Prevailing Wage Law (Labor Code Sections 1720-1861)). Administered by California Department of Industrial Relations (DIR). Certified payroll is required. Federal Davis-Bacon applies to all federal projects.
California has one of the most comprehensive prevailing wage laws in the nation. It applies to all public works projects exceeding $1,000, including construction, alteration, demolition, installation, or repair work done under contract and paid for with public funds. Contractors must register with DIR and submit certified payroll records electronically.
Context
Prevailing Wage & Bidding in California
California has one of the most comprehensive prevailing wage regimes in the country, governed by Labor Code Sections 1720-1861 and administered by the Department of Industrial Relations. Coverage is broad and the threshold is among the lowest in the nation: virtually all public works over $1,000 are covered, including construction, alteration, demolition, installation, and repair paid for with public funds, and new construction on state projects can be covered with no threshold at all. For estimators this means almost any public job must be priced to the full DIR prevailing wage and fringe rate for each classification, with little room for market-rate labor assumptions.
Compliance is gated before you can even bid. Contractors and subcontractors must register with DIR to work on public works, and certified payroll must be submitted electronically through the DIR eCPR system. On projects over $30,000, apprenticeship requirements apply, so budget for proper apprentice-to-journeyman ratios and the administrative effort of tracking them. When federal funds are present, Davis-Bacon may also apply, and you must follow the higher of the state or federal rate for each trade.
The penalties make accuracy non-negotiable. Underpayment can cost up to $200 per worker per day, rising to $300 per day for willful violations, plus back wages with interest and debarment from public works for up to three years. The most expensive estimating errors here are misclassifying workers, missing the apprenticeship obligation, or failing to register before bidding. Price labor to the correct DIR determination from the outset, confirm your registration is current, and treat eCPR submission as a core project cost when you build your California bid.
Details
Coverage Details
State Law Details
- Law
- California Prevailing Wage Law (Labor Code Sections 1720-1861)
- Agency
- California Department of Industrial Relations (DIR)
- Thresholds
- All public works projects over $1,000No threshold for new construction on state projectsOver $1,000 for alteration, demolition, repair, or maintenance
- Certified Payroll
- Required
Federal Davis-Bacon Coverage
The federal Davis-Bacon Act applies to all federally funded or federally assisted construction contracts over $2,000 in California. This includes projects funded by federal agencies, FHWA highway projects, HUD housing, and projects receiving federal grants.
Reference
Key Facts
One of the lowest thresholds in the nation at $1,000
Electronic certified payroll submission required through DIR eCPR system
Contractors must register with DIR before bidding on public works
Penalties up to $200-$300 per worker per day for violations
Apprenticeship requirements apply on projects over $30,000
Enforcement
Penalties
Penalties of up to $200 per worker per day for underpayment. Penalty increases to $300/day for willful violations. Contractors may be debarred from public works for up to 3 years. Workers can recover back wages plus interest.
Updates
Recent Changes
As of 2025, expanded coverage for certain private projects receiving public funds and updated electronic reporting requirements.
Resources
Related Tools & Templates
Turn wage rules into bid-ready alerts
Use ConstructionBids.ai to track matching public projects, save bid searches, and move wage-sensitive scopes into your estimating workflow.
FAQ
Questions Contractors Ask
Does California have a prevailing wage law?
Yes. California has an active state prevailing wage law: California Prevailing Wage Law (Labor Code Sections 1720-1861). California has one of the most comprehensive prevailing wage laws in the nation. It applies to all public works projects exceeding $1,000, including construction, alteration, demolition, installation, or repair work done under contract and paid for with public funds. Contractors must register with DIR and submit certified payroll records electronically.
Does Davis-Bacon apply in California?
Yes. The federal Davis-Bacon Act applies to all federally funded construction projects over $2,000 in California, regardless of state law. Contractors must pay the prevailing wage rate determined by the DOL for the project location.
Is certified payroll required in California?
Yes. California requires certified payroll on state prevailing wage projects. Additionally, certified payroll is always required on federal Davis-Bacon projects using form WH-347.
What are the penalties for prevailing wage violations in California?
Penalties of up to $200 per worker per day for underpayment. Penalty increases to $300/day for willful violations. Contractors may be debarred from public works for up to 3 years. Workers can recover back wages plus interest.
What is California's prevailing wage threshold?
California covers essentially all public works over $1,000, including alteration, demolition, repair, and maintenance. New construction on state projects can be covered with no threshold at all. This is one of the lowest coverage thresholds in the nation, so nearly every public job must be priced to DIR rates.
Do contractors have to register with DIR to bid public works in California?
Yes. Contractors and subcontractors must register with the Department of Industrial Relations before bidding or working on public works. Certified payroll is then filed electronically through the DIR eCPR system. Failing to register before bidding can disqualify you, so confirm registration is current first.
What are the penalties for prevailing wage violations in California?
Underpayment can cost up to $200 per worker per day, rising to $300 per day for willful violations, plus back wages with interest. Contractors may also be debarred from public works for up to three years. Apprenticeship obligations apply on projects over $30,000.