Am I Entitled to the Prevailing Wage in New Jersey?

If you are a contractor, subcontractor, or tradesperson in New Jersey, some of your contracts may be subject to “prevailing wage” laws. Whether you’re paying workers or ensuring that your pay is correct, it’s vital that you understand when the NJ prevailing wage laws apply and what they mean to you.

What Is the “Prevailing Wage”?

The New Jersey Prevailing Wage Act (PWA) establishes a prevailing wage level for NJ workers engaged in construction, maintenance, or other services for public works in order to safeguard the workers’ efficiency and general well-being. It also serves to protect workers (and their employers) from the effects of unfair competition resulting from wage levels that are detrimental to the efficiency and well-being of all concerned.^[1] In plain English, this means that on certain public projects, the law sets the minimum amount that workers are paid so that workers receive fair pay and contractors can’t dangerously lowball bids on public works projects.

What Projects Are Subject to the NJ Prevailing Wage Law?

Contracts for public works that are valued at or above the current threshold amounts must comply with the prevailing wage requirements. Public works projects subject to the act are those funded in whole or in part with the funds of a public body. Contracts awarded directly by municipal government or done on property or premises owned entirely by a public body (or leased or to be leased by the municipality) are subject to the law if they are valued at or above $15,444. (This rate is effective July 1, 2014; according to the statute, the value is adjusted every five years.) For other public-funded projects, including those funded by municipal utility authorities and boards of education, the threshold is $2,000.^[2]

How Do I Know the Prevailing Rate That Applies to Me?

The Prevailing Wage Act requires that contractor and subcontractors who are performing work subject to the Prevailing Wage Act requirement post a notice listing the prevailing wage rates for each craft and classification involved in the project. This notice must display the rates and the dates of any changes thereto, and it must be posted in a prominent and accessible place at the worksite or the site where wages are distributed.

The actual rates of pay (including both wages and fringe benefits) vary depending on the county where the work is performed, the type of trade, and the experience of the tradesperson, so the schedule itself is quite complicated. The rates are based on collective bargaining agreements that have been negotiated for each particular craft or trade in the locality in which the public work is performed. Due to changes in the laws or renegotiations in union contracts, the rates change frequently. The tables reflecting the current prevailing wages for each occupation and location are updated and published regularly by the Commissioner of Labor and Workforce Development.

How is the Prevailing Wage Enforced?

Contractors who bid on projects that are subject to the PWA must register with the state and pay applicable registration fees before being eligible to receive a contract; once they receive a contract, they must submit a certificate of compliance for each project. The Division of Wage and Hour Compliance Public Contracts Section regulates the payment of prevailing wage rates on public works projects. This agency updates and distributes the prevailing wage rate charts, performs routine site inspections of public construction projects, assesses fines and penalties to offenders, and bars contractors who are determined to be “serious” offenders from bidding or working on public works projects for up to three years.^[3] Violations of the PWA can result in significant fines to the contractor (up to $1,000 per incident); willful and continued violations can result in imprisonment for up to 90 days.

What if I Wasn’t Paid the Prevailing Wage?

Any worker who believes he or she has been improperly paid under the PWA has two years from the date of the underpayment to file a written complaint with the Division of Wage and Hour Compliance.^[4] Workers who do so are protected from retaliation by the New Jersey Conscientious Employee Protection Act (CEPA), which prohibits an employer from taking any adverse employment action against a worker as a result of reporting an alleged wage violation.

To protect your rights, you should make sure you understand what rate applies to you and monitor your payroll records closely to ensure that you are being paid the correct amount. If you are a worker protected by the PWA and you believe you’re not being paid what you are entitled to, you should consult with an experienced New Jersey wage and hour attorney. If you believe you have been the victim of wage discrimination, retaliation, or other improprieties, contact the Mark Law Firm today for an appointment with one of our employment lawyers in Basking Ridge, Newark, Oradell, Jersey City, or Union, New Jersey.

[1] N.J.S.A. 34:11-56.25 et seq.

[2] “Prevailing Wage Rates on Construction-Related Public Works Projects—General Information.” State of New Jersey Department of Labor and Workforce Development, n.d. Accessed 27 Jul 2017.

[3] [3] N.J.S.A. 34:11-56.56.

[4] N.J.S.A. 34:11-56.34.