How to Do Certified Payroll: A Small Contractor's Guide

What certified payroll is (and why it exists)

"Certified payroll" is a weekly report you send to the agency funding your project, showing exactly what you paid every worker on the job — their classification, hours, wage rate, fringe benefits, and deductions — plus a signed statement swearing it's true. On federal work the form is Form WH-347, and the signature page is the Statement of Compliance.

The requirement comes from the Davis-Bacon Act and the dozens of Related Acts that attach to federally funded construction. These laws say that workers on covered projects must be paid at least the local prevailing wage for their trade. Certified payroll is simply how the government checks that you did. Most states have their own prevailing-wage ("little Davis-Bacon") laws too — California, New York, and many others — with their own forms and portals.

Who has to do it

If you are a contractor or subcontractor performing construction, alteration, or repair on a project funded (fully or partly) by federal money above $2,000, you are almost certainly covered. State-funded work has its own thresholds. Being a one-person shop doesn't exempt you — every worker who swings a hammer on the site gets reported, including working owners in some cases. When in doubt, ask the awarding agency or your prime contractor whether the job is prevailing-wage.

The weekly process, step by step

Get your wage determination.This is the document — incorporated into your contract — that lists each work classification (Electrician, Laborer, Carpenter…) and the required base hourly rate plus fringe rate for your county and project type. Everything you report is measured against it, so start here.
Classify each worker. Match every person to a classification on the determination. If someone works two trades in one week, they get two line rows — one per classification.
Track daily hours. Record hours worked each of the seven days. Anything over 40 in the workweek is overtime under the Contract Work Hours and Safety Standards Act (CWHSSA).
Compute gross, overtime, deductions, and net. Gross is the cash wages earned; deductions are FICA, withholding, and any other permissible items; net is the take-home. (The overtime formula trips most people up — see below.)
Do the fringe accounting. Show whether you satisfied the fringe rate by paying into bona-fide benefit plans, as cash, or a mix. This is the single most-audited part of the whole report.
Sign the Statement of Compliance. An owner or officer signs page 2, attesting the payroll is correct and complete and that everyone was paid at least the determined rate. Willful falsification can carry civil or criminal penalties.
Submit it. Send it to the agency or prime contractor by their required method (below).

The overtime rule people get wrong

Overtime is not1.5× the whole wage package. You take 1.5× the basic hourly rate, then add the fringe at straight time (once) on those overtime hours. Written out:

Overtime hourly rate = (1.5 × base rate) + fringe rate

Worked example — a Laborer with a $20.00 base rate and $8.00 fringe, working 50 hours (40 straight, 10 overtime):

Item	Math	Amount
Straight-time gross	40 × ($20.00 + $8.00)	$1,120.00
Overtime hourly rate	(1.5 × $20.00) + $8.00	$38.00
Overtime gross	10 × $38.00	$380.00
Total gross	—	$1,500.00

Doing it the wrong way — 1.5 × ($20 + $8) = $42.00/hr — overpays by half the fringe rate ($4.00) on every overtime hour. It looks generous, but it also signals to an auditor that your math isn't reliable.

One more habit that saves you

Report only the last four digits of each worker's Social Security number, never the full SSN. That's what the current WH-347 asks for, and it keeps sensitive data off a document that gets emailed and archived.

How often, and for how long

Certified payroll is filed weekly, per project, for the life of the job — every week you have workers on that site until the work is done. Run two prevailing-wage jobs at once and you file two separate weekly reports. If a given week had no work on the project, most agencies still want a "no work" payroll so the numbering stays continuous. Keep copies for at least three years after the project closes.

Where to submit

WH-347 PDF, direct. Smaller federal jobs may just want the signed form emailed or uploaded to the contracting officer or prime.
Agency vendor portals. Many awarding bodies require an electronic system such as LCPtrackeror DOL's own portals, which validate your data as you enter it.
State portals.State-funded work often uses a state system — for example California's DIReCPR portal, which accepts an XML upload. Always confirm your project's exact method before week one.

What happens if you get it wrong

Certified payroll mistakes aren't just paperwork problems. Common consequences include withheld progress payments until you correct and resubmit, back-wage liability if you underpaid the required package, monetary penalties, and — in serious or repeat cases — debarment, meaning you can't bid federal work for up to three years. Most of these trace back to two things: an overtime miscalculation or a fringe shortfall.

A quick weekly checklist

Wage determination on hand and each worker classified against it
Daily hours recorded; hours over 40 flagged as overtime
Overtime = (1.5 × base) + fringe, computed per worker
Fringe package (cash + plan contributions) meets base + fringe
Deductions and net wages reconciled
Only last-4 of SSN shown
Statement of Compliance signed by an owner or officer
Filed by the agency's required method, numbered in sequence

The math is where first-timers lose the most sleep, so if you'd rather not run the overtime and fringe checks by hand, our free WH-347 builder computes gross, overtime, and net, flags any fringe shortfall before you sign, and prints the Statement of Compliance — enter your hours and rates and see your first report free (pricing starts at $29/month after that).