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.
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 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.
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.
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.
As of 2025, expanded coverage for certain private projects receiving public funds and updated electronic reporting requirements.