Example - Check Calculation for Davis-Bacon and Prevailing Wage Jobs

A company with a 401(k) program continues to contribute to the 401(k) program for their state prevailing wage jobs and their Federal Davis-Bacon jobs.

The prevailing wages are $20 base rate and a $5 fringe rate. The employer benefit is $2 per hour for medical, dental, and other benefits (stored in the employee file).

  • Select the Calculate actual benefits for the D-B/Prevailing wage employer benefit credit checkbox in the Payroll Installation- Defaults screen.

  • In the Deduction / Add-on Code Maintenance screen, set up the 401(k) non-cash add-on (for example, 2K), select to include pay and hours for all three job types (Davis-Bacon, prevailing wage, and other), and select the checkbox to compute this add-on as part of the D-B/Prevailing wage employer benefit (located in the Add-on tab).

    Note: If your 2K code (employer match) is a function of the employee contribution (that is, if the calculation type is ‘Percent of related code’), then the employee contribution MUST also be subject to Davis-Bacon, prevailing wage, and private jobs.
  • In the Non-Union Pay Group File Maintenance > Prevailing Wage window, the setup would be as follows for both prevailing wage and Davis-Bacon Jobs:

    Health & Welfare: H1 Health & Welfare method: Health & Welfare

    Pension: none

    Cash fringe benefit: CF Cash Fringe Pay method: Prevailing Wage Adjustment
    Note: Make sure the two "Disable…" checkboxes are clear.
  • Attach the add-on (2K) to the employee in Employee Deduction/Add-on Maintenance.

  • Complete the employee time card: 10 hours on private job, base pay $15.00/hr 20 hours on prevailing wage job, base pay $20.00/hr 10 hours on Davis-Bacon job, base pay $20.00/hr

  • The total 401(k) benefits calculated for this check ($750 gross, simple 10%) = $75.00. The prevailing wage 401(k) portion is $400 gross x 10% = $40.00. The Davis-Bacon 401(k) portion is $ 200 gross x 10% = $20.

The check calculation results for the prevailing wage job and Davis-Bacon job would be as follows:

Check Calculation Results

DB/PW Hours

Base Pay

Fringe Pay

Employer Benefit

401(k) Benefit

Pension

30 hrs

600.00

150.00

60.00

60.00

120.00

0.00

30.00

(30x2)

(40+20)

(60+60)

(150-120)

If the checkbox to compute this add-on as part of the D-B/Prevailing wage employer benefit (located in the Deduction / Add-on Code Maintenance > Add-on screen) was left clear, the calculation results for this example would appear as follows:

Check Calculation Results

DB/PW Hours

Base Pay

Fringe Pay

Employer Benefit

401(k) Benefit

Health & Welfare

Pension

Cash Fringe

30 hrs

600.00

150.00

60.00

60.00

60.00

0.00

90.00

(40+20)

(30 + 60)