JULY 8, 2015: Using Collective Bargaining Agreements to validate the hourly wage of construction employees.

Some Construction or Erection classifications are Dual Wage classifications that require verification that the employee’s regular hourly wage equals or exceeds a specified amount. This hourly wage verification is performed as part of the policy final audit. Dual Wage classifications are subject to record keeping requirements that are provided in the California Workers’ Compensation Uniform Statistical Reporting Plan – 1995 (USRP) at Part 3, Section IV, Rule 2a(1), Records of Payroll. This rule states, in part:

For all employees, other than salaried employees, determination of the regular hourly wage must be supported by one of the following sources:

  1. Original time cards or time book entries for each employee. Original records must include the operations performed, the total hours worked each day and the times the employee started and ended each work period throughout the workday. At job locations where all of the employer’s operations cease for a uniform unpaid meal period, recording the start and stop times of the uniform break period is not required.
  2. A valid collective bargaining agreement that shows the regular hourly wage rate by job classification of worker. If using a collective bargaining agreement, the records must include an employee roster by job classification that permits the reconciliation of individual employees to the job classifications set forth in the collective bargaining agreement. For all employees, other than salaried employees, the payroll for which an hourly wage determination cannot be reconciled to time cards or time book entries or collective bargaining agreements as specified above shall not be assigned to a classification that requires the regular hourly wage to equal or exceed a specified amount.

For all employees, other than salaried employees, the payroll for which an hourly wage determination cannot be reconciled to time cards or time book entries or collective bargaining agreements as specified above shall not be assigned to a classification that requires the regular hourly wage to equal or exceed a specified amount.

The WCIRB has received questions regarding the use of a collective bargaining agreement (CBA) to verify employees’ hourly wage rates. A CBA, also known as a labor agreement, union agreement or union contract, is a legally enforceable contract between the management of an organization and its employees represented by a trade union and it details the rules and conditions of employment, including wages, working hours and conditions, overtime, holidays, vacations and benefits.

Because a CBA is a legally-enforceable contract, it is a reliable document for the purposes of verifying employees’ hourly wage rates. A CBA does not include the names of individual employees as it usually applies to many different employers who bargain together and become a signatory to the agreement. A CBA does list categories of construction workers, and the wages and benefits that must be paid to workers in each category. When using a CBA to validate an employee’s hourly wage, it is incumbent on the auditor to reconcile each employee to their applicable category.

Related Information

Classification Search

Classification Information

Online Guide to Workers’ Compensation: The Standard Classification System

USRP Time Card Requirements – What is Acceptable?

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