Certified payroll is a unique kind of payroll report that may be important and even legally required for your business to function properly. It notably differs from standard payroll administration practices, so it is essential to understand the differences. Take a closer look at certified payroll administration, and discover why outsourcing this service could be an effective solution for your needs.
Certified payroll administration is a process that involves carrying out weekly payroll reports specifically for contractors working on projects partly or fully supported by federal funds — and which total a minimum of $2000. This type of payroll reporting is carried out through Form WH-347, which must be submitted to the Department of Labor every week the contractor works on the relevant project. This differs from standard payroll administration in that certified payroll reporting must meet these extra requirements to remain legally compliant.
Form WH-347 includes information such as employee details, wages, benefits, the number of hours worked, and the nature of the work performed. Additionally, this form requires a statement of compliance in which you must claim that you are paying your employees the prevailing wage and that all information in the report is accurate.
The prevailing wage is the legally considered fair wage for hourly workers as determined by a number of laws and acts, including the Davis-Bacon Act. Prevailing wage requirements vary depending on where your business and workers are located, as the Department of Labor conducts surveys of average pay for workers in a particular area who perform specific occupations. That means that a state with a higher average wage for construction workers, for example, will have higher prevailing wage requirements than states with lower average wages. The Department of Labor can provide the prevailing wage standard for your particular area.
The majority of the certified payroll process lies within filling out Form WH-347. This form contains six primary sections for relevant information.
In addition to those six sections, you will need to provide the following information about each employee working on the contract.
Having certified payroll administration services take care of your requirements will leave you more time to focus on your business without having to worry about the consequences of failed compliance. The consequences can be serious and include some of the following penalties.
Certified payroll administration services ensure that you avoid those penalties and can help avoid some of the most common mistakes often seen in certified payroll reports done directly by businesses. Some of these common mistakes include the following.
At SPLI, we can offer certified payroll administration services that help your business remain compliant, leaving you time to focus on the actual running of your business. Our APA-accredited specialists have the experience necessary for your business to approach government contracts with confidence. Get in touch with our team today to get started.