Tennesee Prevailing Wage Information
GENERAL INFORMATION
The State of Tennessee enacted a state prevailing wage statute, the Tennessee Prevailing Wage Act (TPWA) (Tenn. Code Ann. § 12-4-401), however this Act was recently amended. According to Tennessee Department of Labor and Workforce Commission’s “January 1, 2014 Prevailing Wage Bulletin” the Labor Standards Division has no authority to inspect/regulate state building projects effective January 1, 2014. Under the old law, a “state contract” is “any contractual agreement (written or oral) entered into by any person, firm or corporation with the State of Tennessee for the performance of work on a state construction project.” The new law states that a “state contract” is “any contractual agreement (written or oral) entered into by any person, firm, or corporation with the State of Tennessee for the performance of work on a state highway construction project.”
Please See, Tennessee Department of Labor and Workforce Development webpage listed below under “Helpful Links” and click on “Prevailing Wage Bulletin” to view other minor changes made to the TPWA.
State building project entered prior to January 1, 2014
If a contract for a state building project is entered prior to January 1, 2014, prevailing wage rates apply and inspection and regulation is necessary. Please See, Agency Rule 0800-3- 2.07 to determine what can be inspected and regulated. Moreover, the prevailing wage rates apply throughout the duration of the contract. The contract date (not the advertisement date) dictates.
State building projects entered into on January 1, 2014
If a contract for a state building project is entered on January 1, 2014 or thereafter, the prevailing wage rates do not apply. However, other laws regulated laws are still applicable (e.g., wage regulation, child labor, illegal alien), and will be pursued by the agencies.
Not applicable to the new law
The changes made to the Tennessee Prevailing Wage Act of 1975 are inapplicable to contracts for state roads, highways, and bridges. Please See, Agency Rule 0800-3-2.07 to determine inspection and regulation requirements on state highway projects.
Wage Disputes on or after January 1, 2014
If an employee has a wage dispute on or after January 1, 2014 (as to non- highway/bridges or horizontal construction projects), his/her recourse is to file a claim in the Davidson County Chancery Court. The employer is not bound by rates set by the Prevailing Wage Commission or the Labor Market Information Section (LMI) of the Tennessee Department of Labor and Workforce Development (as to non-highway/bridges or horizontal construction projects). This policy applies to contracts entered into on or after January 1, 2014.
THRESHOLD
Under the TPWA, the monetary threshold requirement for prevailing wage regulations to apply to state highway construction projects is an amount exceeding $50,000.
TIMING & INCREASES
The Prevailing Wage Commission (comprised of five members including: commissioner of labor and workforce development, the state architect, commissioner of transportation or commissioner’s designee) sets the rates on state-funded highway (highway, road, and bridge) construction projects every year. A survey is performed annually to study each industry and the survey is used to determine appropriate rates for highway construction projects. The highway wage rate promulgated by the Commission will be effective from January 1 to December 31 of each year.
OVERTIME
The TPWA does not include a provision in regards to payment of daily overtime. According to state law, overtime compensation is paid for any hours worked in excess of forty hours per week.
WORKING ON THE WEEKENDS
The TPWA does not include a provision regarding payment of a different wage rate for working on the weekend. Thus, the same overtime regulations stated under the “Overtime” section above apply.
WORKING ON LEGAL HOLIDAYS
The TPWA does not require a different payment for working on legal holidays, thus the same general overtime rules apply. Please See, “Overtime” section for overtime rules.
SHIFT DIFFERENTIALS
The TPWA does not require different payments for working different shifts throughout the day. Therefore, workers will be compensated the same prevailing wage rate per trade regardless of the shift worked throughout the day.
FRINGE BENEFITS
The TPWA does not require payment of fringe benefits (the prevailing wage rate is comprised of the hourly rate of pay).
TRAINING CONTRIBUTIONS
The TPWA does not require payment for training contribution.
APPRENTICE REQUIREMENTS
Apprentices must be registered individually under a bona fide apprenticeship program registered with the Bureau of Apprenticeship and Training of the United States Department of Labor. The state agency contracting officer requires the contractor/subcontractor using the apprentice to submit evidence of his indenture and/or apprenticeship registration when the apprentice's name first appears on a submitted payroll.
TRAVEL & SUBSISTENCE
The TPWA does not require payment for travel and subsistence.
CONTRACTOR LICENSING
To perform construction work in Tennessee, the state requires contractors to be licensed.
Please See, Tennessee's Contractor Licensing Policy
PENALTIES
Underpayment of prevailing wages
In Tennessee, if prevailing wage violations are found, the contractor is required to pay the prevailing wage plus any back wages due. Claims are investigated and certified payroll is reviewed. If violations are found, state contracting agencies are placed on notice by “WRC—Labor Standard Inspectors.” If prime contractors or other employers do not pay employees proper rates, WRC—Labor Standard Inspectors contact state contracting agencies and place them on notice. State contracting agencies have discretion as to whether to place a hold on money owed to the prime contractor or other employers or handle the matter in accordance with their agency rules.
DEBARMENT
The Tennessee Department of Transportation, Construction Division, may debar a person for various reasons.
Details on the Reasons for Debarment
If the debarring official decides to debar someone, the period of debarment will be based on the seriousness of the cause(s) upon which your debarment is based. Generally, debarment should not exceed three years. However, if circumstances warrant, the debarring official may impose a longer period of debarment. If a suspension has preceded the debarment, the debarring official must consider the time you were suspended.
HELPFUL LINKS
Tennessee Department of Labor and Workforce Development
Tennessee Prevailing Wage Act (Please Select Tennessee Code, Title 12, Chapter 4, Sections 401-415)
FAQ
CONTACT INFORMATION
Christina Tugman
Department of Labor and Workforce Development
Workplace Regulations & Compliance Division
Address: 220 French Landing Drive
Nashville, Tennessee 37243
Phone: 615-741-1627
Christina Tugman's Email
The State of Tennessee enacted a state prevailing wage statute, the Tennessee Prevailing Wage Act (TPWA) (Tenn. Code Ann. § 12-4-401), however this Act was recently amended. According to Tennessee Department of Labor and Workforce Commission’s “January 1, 2014 Prevailing Wage Bulletin” the Labor Standards Division has no authority to inspect/regulate state building projects effective January 1, 2014. Under the old law, a “state contract” is “any contractual agreement (written or oral) entered into by any person, firm or corporation with the State of Tennessee for the performance of work on a state construction project.” The new law states that a “state contract” is “any contractual agreement (written or oral) entered into by any person, firm, or corporation with the State of Tennessee for the performance of work on a state highway construction project.”
Please See, Tennessee Department of Labor and Workforce Development webpage listed below under “Helpful Links” and click on “Prevailing Wage Bulletin” to view other minor changes made to the TPWA.
State building project entered prior to January 1, 2014
If a contract for a state building project is entered prior to January 1, 2014, prevailing wage rates apply and inspection and regulation is necessary. Please See, Agency Rule 0800-3- 2.07 to determine what can be inspected and regulated. Moreover, the prevailing wage rates apply throughout the duration of the contract. The contract date (not the advertisement date) dictates.
State building projects entered into on January 1, 2014
If a contract for a state building project is entered on January 1, 2014 or thereafter, the prevailing wage rates do not apply. However, other laws regulated laws are still applicable (e.g., wage regulation, child labor, illegal alien), and will be pursued by the agencies.
Not applicable to the new law
The changes made to the Tennessee Prevailing Wage Act of 1975 are inapplicable to contracts for state roads, highways, and bridges. Please See, Agency Rule 0800-3-2.07 to determine inspection and regulation requirements on state highway projects.
Wage Disputes on or after January 1, 2014
If an employee has a wage dispute on or after January 1, 2014 (as to non- highway/bridges or horizontal construction projects), his/her recourse is to file a claim in the Davidson County Chancery Court. The employer is not bound by rates set by the Prevailing Wage Commission or the Labor Market Information Section (LMI) of the Tennessee Department of Labor and Workforce Development (as to non-highway/bridges or horizontal construction projects). This policy applies to contracts entered into on or after January 1, 2014.
THRESHOLD
Under the TPWA, the monetary threshold requirement for prevailing wage regulations to apply to state highway construction projects is an amount exceeding $50,000.
TIMING & INCREASES
The Prevailing Wage Commission (comprised of five members including: commissioner of labor and workforce development, the state architect, commissioner of transportation or commissioner’s designee) sets the rates on state-funded highway (highway, road, and bridge) construction projects every year. A survey is performed annually to study each industry and the survey is used to determine appropriate rates for highway construction projects. The highway wage rate promulgated by the Commission will be effective from January 1 to December 31 of each year.
OVERTIME
The TPWA does not include a provision in regards to payment of daily overtime. According to state law, overtime compensation is paid for any hours worked in excess of forty hours per week.
WORKING ON THE WEEKENDS
The TPWA does not include a provision regarding payment of a different wage rate for working on the weekend. Thus, the same overtime regulations stated under the “Overtime” section above apply.
WORKING ON LEGAL HOLIDAYS
The TPWA does not require a different payment for working on legal holidays, thus the same general overtime rules apply. Please See, “Overtime” section for overtime rules.
SHIFT DIFFERENTIALS
The TPWA does not require different payments for working different shifts throughout the day. Therefore, workers will be compensated the same prevailing wage rate per trade regardless of the shift worked throughout the day.
FRINGE BENEFITS
The TPWA does not require payment of fringe benefits (the prevailing wage rate is comprised of the hourly rate of pay).
TRAINING CONTRIBUTIONS
The TPWA does not require payment for training contribution.
APPRENTICE REQUIREMENTS
Apprentices must be registered individually under a bona fide apprenticeship program registered with the Bureau of Apprenticeship and Training of the United States Department of Labor. The state agency contracting officer requires the contractor/subcontractor using the apprentice to submit evidence of his indenture and/or apprenticeship registration when the apprentice's name first appears on a submitted payroll.
TRAVEL & SUBSISTENCE
The TPWA does not require payment for travel and subsistence.
CONTRACTOR LICENSING
To perform construction work in Tennessee, the state requires contractors to be licensed.
Please See, Tennessee's Contractor Licensing Policy
PENALTIES
Underpayment of prevailing wages
In Tennessee, if prevailing wage violations are found, the contractor is required to pay the prevailing wage plus any back wages due. Claims are investigated and certified payroll is reviewed. If violations are found, state contracting agencies are placed on notice by “WRC—Labor Standard Inspectors.” If prime contractors or other employers do not pay employees proper rates, WRC—Labor Standard Inspectors contact state contracting agencies and place them on notice. State contracting agencies have discretion as to whether to place a hold on money owed to the prime contractor or other employers or handle the matter in accordance with their agency rules.
DEBARMENT
The Tennessee Department of Transportation, Construction Division, may debar a person for various reasons.
Details on the Reasons for Debarment
If the debarring official decides to debar someone, the period of debarment will be based on the seriousness of the cause(s) upon which your debarment is based. Generally, debarment should not exceed three years. However, if circumstances warrant, the debarring official may impose a longer period of debarment. If a suspension has preceded the debarment, the debarring official must consider the time you were suspended.
HELPFUL LINKS
Tennessee Department of Labor and Workforce Development
Tennessee Prevailing Wage Act (Please Select Tennessee Code, Title 12, Chapter 4, Sections 401-415)
FAQ
CONTACT INFORMATION
Christina Tugman
Department of Labor and Workforce Development
Workplace Regulations & Compliance Division
Address: 220 French Landing Drive
Nashville, Tennessee 37243
Phone: 615-741-1627
Christina Tugman's Email