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Prevailing Wage and Davis-Bacon Compliance in North Carolina

eMars provides certified payroll and compliance solutions tailored primarily for federal projects and select state jurisdictions. While many agencies accept the standard WH-347 form, some states will require their own form. For questions about supported jurisdictions, please contact our team directly.

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North Carolina's Public Works Regulations

North Carolina does not have a state prevailing wage law, and is one of eight states that have never enacted one.

  • Federal Law: The Davis-Bacon and Related Acts (DBRA) apply to federally funded or federally assisted construction contracts in NC, requiring payment of the locally prevailing wages and fringe benefits set by the U.S. Department of Labor.
  • State Law: NC does not have a "Little Davis-Bacon Act" or substitute prevailing wage statute. State and locally funded public works contracts are subject to whatever wage terms the awarding agency writes into the contract itself.

The NC Department of Labor (NCDOL) enforces the NC Wage and Hour Act (NCGS § 95-25.1 et seq.) on construction work performed in the state, including minimum wage, overtime, and wage payment timing, even where no prevailing wage applies. Public construction contracts in NC are also subject to general contractor licensing under Chapter 87 of the NC General Statutes and the public contracts framework under Chapter 143, Article 8.

Definition of "Public Works" in North Carolina

In North Carolina, public works generally refers to constructing, repairing, or maintaining public buildings, roads, highways, and other state-owned infrastructure, including:

  • Public buildings and government facilities
  • Roads, highways, and bridges
  • Water and sewer infrastructure
  • Federally assisted energy projects, including solar panel and wind turbine installation, broadband installation, and EV charging station installation

NC public works contracts can be awarded at the state, county, or municipal level. When federal funds are used on a project, federal Davis-Bacon wage requirements attach. State and locally funded NC public works projects are not subject to a state prevailing wage rate.

Prevailing Wage Determinations: Federal (Davis-Bacon) Requirements

Because NC has no state prevailing wage law, the U.S. Department of Labor sets the prevailing wage rates that apply to federally funded or assisted construction projects in the state. Key points include:

  • Davis-Bacon Act: Requires contractors and subcontractors on federally funded construction contracts to pay laborers and mechanics no less than the locally prevailing wages and fringe benefits set by DOL.
  • Federal Wage Determinations: The U.S. Department of Labor's Wage and Hour Division publishes prevailing wage rates by county and construction type on SAM.gov.

Components of Wage Determinations

Federal wage determinations applied in North Carolina include:

  • Basic Hourly Rate: The minimum hourly wage paid directly to workers in a specific job classification, set by DOL through local wage surveys.
  • Fringe Benefits: Non-cash compensation such as health insurance, retirement contributions, and vacation/holiday pay paid on top of the basic rate.
  • Total Hourly Rate: The sum of the basic hourly rate and fringe benefits. Contractors can provide bona fide fringe benefits or pay the equivalent value as additional cash on top of the basic rate.

If no fringe benefits are provided, the contractor must pay the full total hourly rate as cash wages on top of the basic rate listed on the applicable SAM.gov wage determination.

Compliance for Contractors and Subcontractors

Contractors and subcontractors working on federally funded public works projects in North Carolina must:

Determine if the project is federally funded

Determine if the project is federally funded

Davis-Bacon prevailing wage requirements attach only when federal funds are used on a project of $2,000 or more.

Obtain the wage determination

Obtain the wage determination

Pull the DOL wage determination for the project locality and construction type from SAM.gov, applying the determination in effect ten days before bid opening.

Post wage determinations

Post wage determinations

Display the prevailing wage determination in a conspicuous location at the job site where workers can easily access it.

Submit certified payrolls

Submit certified payrolls

Contractors must submit certified payrolls each week showing wages paid to each worker. This includes detailing the basic hourly rate, fringe benefits, and hours worked. File Form WH-347 weekly with the contracting agency.

Maintain accurate records

Maintain accurate records

Keep payroll records, including hours worked, classifications, wages, and fringe benefits, for at least three years after the prime contract is completed. Records must include worker telephone and email contact information on DOL request and must be available for inspection by DOL or the contracting agency.

Penalties for Non-Compliance

While North Carolina doesn't have state-specific penalties, federal law imposes strict consequences for Davis-Bacon Act violations, including:

  • Back Wages owed to underpaid workers

  • Civil Penalties per violation

  • Termination of the federal contract

  • Withholding and cross-withholding of contract payments

  • Debarment from federally funded or assisted contracts
  • Criminal Prosecution for willful violations

Unique Aspects of North Carolina's Public Works System

Unique Aspects of North Carolina's Public Works System

  • General Contractor Licensing Threshold: Under Chapter 87 of the NC General Statutes, any person or entity that undertakes a construction project costing $40,000 or more must hold a NC general contractor license issued by the NC Licensing Board for General Contractors.
  • Public Contracts Bidding Framework: Under NC General Statutes Chapter 143, Article 8, formal sealed bidding is required for any construction or repair project where the estimated public expenditure is $500,000 or more (§ 143-129), with separate prime specifications for plumbing, electrical, HVAC, and general contractor required on building projects of $300,000 or more (§ 143-128). Bids must be accompanied by a deposit or bid bond of at least 5 percent of the proposal, and public entities must establish good-faith efforts for minority business participation under § 143-128.2.
  • State Labor Oversight Without State Prevailing Wage: The NC Department of Labor enforces general wage and hour rules on NC construction work (minimum wage, overtime, weekly wage payment timing) under the NC Wage and Hour Act, even where no prevailing wage applies.
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Relevant Resources

For the most accurate and current information on prevailing wage requirements, consult the U.S. Department of Labor or your state's official labor website.

North Carolina Prevailing Wage FAQs

Are there state-specific prevailing wage laws in North Carolina?

No. NC is one of eight states that have never enacted a state prevailing wage statute, and there is no "Little Davis-Bacon Act" or substitute requirement. State and locally funded NC public works are not subject to a state prevailing wage rate. For federally funded or assisted projects of $2,000 or more, the federal Davis-Bacon Act applies.

How are prevailing wage rates determined for public works projects in North Carolina?

Federal Davis-Bacon rates apply to federally funded or assisted projects in NC. The U.S. Department of Labor sets rates by county and construction type through local wage surveys, publishes them on SAM.gov, and contractors apply the determination in effect ten days before bid opening. Each rate includes both a basic hourly wage and a fringe benefit amount. NC does not publish state prevailing wage determinations.

What are the penalties for non-compliance with prevailing wage requirements in North Carolina?

Federal penalties include back wages, withholding and cross-withholding of contract payments, civil penalties per violation, CWHSSA liquidated damages per worker per day for overtime violations on covered contracts of $100,000 or more, three-year debarment from federal contracts, and criminal prosecution for willful violations. The NC Department of Labor can also impose state-side administrative remedies for wage payment timing, minimum wage, and overtime violations under the NC Wage and Hour Act, even on projects where no prevailing wage applies.

How are fringe benefits handled under prevailing wage regulations?

Contractors must provide bona fide fringe benefits such as health insurance, retirement contributions, or paid leave, or pay the equivalent value as additional cash on top of the basic hourly rate. Total compensation must equal at least the basic rate plus the fringe rate listed on the applicable SAM.gov wage determination. If no fringe benefits are provided, the full total hourly rate must be paid as cash directly to the worker.