Legal Question in Construction Law in California

If a project is bid for the current prevailing wage and a contract is signed. Is the contractor due additional compensation if the wage increases?


Asked on 5/09/12, 5:35 pm

1 Answer from Attorneys

No, because the prevailing wage remains the same as on the date the advertisements for bids went out, even if it changes for new projects, unless there was a predetermined increase that was scheduled to take place and listed as such in the prevailing wage determination tables. The prevailing wage does not change during the course of the project unless it is a prevailing wage that is subject to a predetermined increase at the time of the advertisement for bids. The contractor is responsible for determining prevailing wage rates that will be in effect for the project in making the bid. The rates may stay the same or they may go up, just as if the contractor has a union contract on a private job. If the contract wages under a union contract will stay the same for the life of the project, you bid one price, if you know that your contract is going to give your journeyman carpenters a 5% raise in the middle of the job, you bid a higher price. Likewise, the prevailing wages are either "single asterisk" meaning there is a single "*" after the expiration date in the prevailing wage tables, meaning that wage will stay in effect for the duration of all jobs advertised before the expiration date, or a double "**" after the rate, which means that a new rate has already been determined for after the expiration date, and that rate will take effect on the expiration date regardless of when the job is advertised for bid. The contractor then has to estimate the labor costs according to whether the prevailing wage will be fixed or change and bid accordingly. But remember, unless the prevailing wage had a ** expiration, even if a new wage for that job classification takes effect, the prevailing wage remains the same as on the date the bid advertisement, for the life of the job. If a wage rate DID have a ** expiration date, then it was up to the contractor to determine what the higher wage would be and when it would go into effect, at the time of bidding.

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Answered on 5/10/12, 3:16 pm


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