Missouri Prevailing Wage Laws: A Complete Guide for Contractors
Overview of the Missouri Prevailing Wage Law
Missouri's Prevailing Wage Law establishes prevailing wage requirements on state-funded construction projects, ensuring contractors and subcontractors pay standardized wages that reflect local labor standards for similar work across Missouri counties.
For any construction company impacted by this law, Payroll4Construction is here. As a complete payroll service, Payroll4Construction is built to keep contractors compliant with certified payroll reporting and prevailing wage rate determinations.
Keep reading to learn more about Missouri's prevailing wage laws and how we can help you.
What is Prevailing Wage in Missouri?
Missouri requires contractors and subcontractors in the construction industry to pay prevailing wages on public works projects when the total project cost exceeds $75,000. This includes:
- State government construction projects over $75,000
- Local government construction projects over $75,000
- School district construction projects over $75,000
- Projects like bridges, roads and government buildings
Under this law, construction workers must receive minimum hourly wages and fringe benefits based on county-specific standards for their particular occupational title as determined by the Missouri Division of Labor Standards.
Don’t Let Prevailing Wage Compliance
Slow Down Your BusinessPrevailing Wage Rate Determination
Setting Initial Rates
The Missouri Division of Labor Standards (DLS) has several crucial responsibilities related to establishing and maintaining prevailing wage rates. These ensure fairness throughout the contracting process.
The DLS must:
- Determine appropriate prevailing wages for each occupational title in each individual county throughout the state
- Publish these rates annually in the Annual Wage Order
- Include these rates in all project specifications and contracts
- Update rates annually to reflect current local conditions
Rate Calculation Method
The DLS follows a structured approach to determine fair and accurate compensation rates. Prevailing wage rates are determined by actual hours worked, for a particular occupational title, in each individual county throughout the state. They establish rates by analyzing:
- Local wage surveys and actual wages paid in each county
- Hours worked data for specific occupational classifications
- Regional wage patterns across Missouri counties
- Input from public hearings and objection periods when necessary
Prevailing Wage Requirements
Prevailing wage laws establish minimum compensation standards for workers on public projects. These requirements ensure fair labor practices and create a level playing field for all contractors bidding on government work.
- Contractor
Contractors bear significant responsibility for ensuring project compliance with prevailing wage regulations. These requirements apply throughout the entire project lifecycle:
- Obtaining prevailing wage rate schedules from the Missouri Division of Labor Standards
- Submitting a Project Notification - Contractor Notification Form (PW-2 form) prior to beginning any work
- Submitting a list of all project contractors using the same form
- Paying prevailing wages to all covered workers based on county-specific determinations
- Ensuring all subcontractors comply with prevailing wage requirements
How to Submit Prevailing Wage Proof
Missouri's prevailing wage law requires contractors and subcontractors to comply with specific notification and documentation procedures before and during public works projects.
This process involves comprehensive project notification and ongoing compliance verification.
Information and steps needed in the compliance process include:
- Requesting the Annual Wage Order using the Request for Wage Determination form (PW-3 form)
- Submitting Project Notification - Contractor Notification Form (PW-2 form) prior to beginning work
- Business registration and contact information
- Federal Employer Identification Number (FEIN)
- Proof of workers' compensation insurance
- Acquiring completed Affidavit of Compliance forms from all contractors and subcontractors before making final payments
In essence, contractors need certified payroll records and evidence of proper wage payments throughout the project. The Division of Labor Standards can be contacted at (573) 751-3403 for assistance with compliance requirements.
Contractors must certify that they:
- Will pay prevailing wages to workers according to county determinations
- Maintain workers' compensation insurance
- Comply with all applicable labor standards
- Submit required documentation throughout the project lifecycle
Compliance, Enforcement and Consequences
The Missouri prevailing wage system relies on robust compliance mechanisms and meaningful penalties to ensure all parties adhere to established standards. These measures protect workers' rights, ensuring compliance with wage standards while maintaining the integrity of public projects.
Wage Payment Rules
Prevailing wage laws establish minimum compensation requirements that cannot be circumvented. This ensures workers receive fair pay for their labor on public projects.
The rules surrounding wage payment include:
- Workers must receive county-specific prevailing rates for their occupational classification
- Rates include both actual wages and fringe benefits
- Rates are determined by actual hours worked data for each county
- Employers cannot pay below these rates, even with worker consent
- Payroll records must be maintained and made available for inspection
Violation Consequences
Significant operational and financial repercussions await contractors who fail to comply with prevailing wage requirements, potentially jeopardizing their entire business.
Construction businesses are at risk of penalties, including:
- Investigation and administrative action by the Missouri Division of Labor Standards
- Penalty of $100 per day (or portion of a day) for each worker that is paid less than the prevailing rate
- Assessment of unpaid wages and back pay requirements
- Fines for failing to comply with wage regulations or certified payroll requirements
- Potential legal action for willful violations
- Exclusion from future public works projects
Prevailing Wage Whistleblower Protections
Missouri law includes protections for workers who report violations of prevailing wage requirements or payroll discrepancies, though these protections operate within the state's general labor law framework.
Employees can report prevailing wage violations through:
- Filing complaints with the Missouri Division of Labor Standards
- Reporting underpayment or misclassification issues
- Requesting investigation of payroll record discrepancies
- Seeking enforcement of compliance requirements
The division investigates claims and enforces compliance to ensure workers receive proper compensation under prevailing wage determinations.
Penalties
The legal framework includes substantial financial penalties and establishes clear liability structures to encourage compliance.
Financial consequences include:
- Daily penalties of $100 per affected worker
- Payment of back pay covering the difference if workers were underpaid
- Administrative fines and enforcement actions
- Joint liability between contractors and subcontractors
- Legal costs and potential court proceedings for serious violations
How Payroll4Construction Helps You Stay Compliant
Payroll4Construction is a construction payroll service widely considered one of the best payroll solutions for Missouri contractors. With our Davis-Bacon compliance monitoring, contractors will never have to worry about how to comply with Missouri prevailing wage laws again.
These time-saving services reduce administrative hours spent on complex wage calculations and paperwork. In turn, this gives the team peace of mind knowing that prevailing wage obligations are being handled correctly.
Missouri contractors in Kansas City, St. Louis, and throughout the state rely on Payroll4Construction to manage certified payroll, ensure county-specific prevailing wage compliance, and avoid costly DLS penalties.
Prevailing Wage Exceptions
Most public works projects in Missouri must adhere to state prevailing wage laws. However, certain exemptions exist under specific circumstances.
These exemptions don't release contractors from fair wage obligations. Instead, the exemptions allow them to follow alternative regulatory frameworks that still maintain worker protections and compensation standards.
Projects may be exempt from Missouri-specific prevailing wage requirements if they:
Fall below the monetary threshold:
- Under $75,000 for all public works construction projects
Follow the federal Davis-Bacon Act requirements because the job receives federal funding.
- The Davis-Bacon Act establishes its own prevailing wage determination system
- Contractors must still maintain detailed, accurate records for payroll
- Federal wage classifications may differ from state calculations but maintain worker protections
- Compliance with federal standards requires the same rigorous documentation and enforcement
-
Qualify for specific statutory exemptions such as:
- Certain maintenance and repair work
- Emergency repair work
- Specific projects explicitly exempted by law
- Certain types of material supply contracts
In all cases, contractors remain responsible for understanding which wage standards apply to their projects. When in doubt, following the higher wage standard ensures compliance with all applicable regulations.
