California’s Prevailing Wage Law: What Employers Need to Know

As an employer in California, it is important to be aware of the state’s prevailing wage law. This law requires employers to pay their workers a wage that is determined by the Department of Industrial Relations (DIR) based on the locality and type of work performed. Failure to comply with this law can result in costly fines and penalties.

What is the Prevailing Wage Law?

The Prevailing Wage Law, also known as the Prevailing Wage Determination, requires employers to pay their workers a wage that is equivalent to the wage paid to workers in similar jobs in the same locality. The law applies to workers who are employed on public works projects, which are defined as construction, alteration, demolition, installation, or repair work that is funded in whole or in part by public funds.

Under the law, employers are required to pay their workers the prevailing wage rate for their specific job classification. This rate is determined by the DIR and is based on the locality and type of work performed. The prevailing wage rate includes the hourly rate of pay as well as any fringe benefits, such as health insurance, pension plans, and vacation pay.