If you’re a construction business owner, you’re already aware that you must pay the prevailing wage to laborers involved in federal contracts. This hurdle often proves to be a significant stumbling block for businesses that are not equipped to pay higher wages.
Fortunately, using a Davis Bacon Pension Plan can help you offset some of this cost. In this article, we’ll take a look at three facts regarding Davis Bacon Pension Plans – keep these in mind if you’re planning on incorporating this type of pension plan into your business.
1. It Can Save Your Business Serious Money
First things first – a Davis Bacon Pension Plan can help your business save serious money. By offsetting your payroll tax liabilities, you’ll be able to reduce the financial burden of complying with prevailing wage regulations. It’s one of the best ways to reduce your exposure to the Davis Bacon Act.
2. Misclassification Can Result in Punitive Damage
If you’re working on a Davis Bacon project and you misclassify a worker, it can result in severe issues for your business.
While some business owners cut corners on purpose, others make the mistake of not appropriating hours correctly.
For example, if you have an electrician that also works as a laborer, you must pay them the correct prevailing wage for hours that they work in each role. You cannot merely pay them the lower laborer wage for all working hours.
3. Software Can Help
If you’re struggling to manage a Davis Bacon project, using software to help you track staff hours and prevailing wages is critical. By accessing specialized software, you can ensure that you’re following the Davis Bacon Act. In essence, this is essential for business owners that want to take advantage of a Davis Bacon Pension Plan.
Fortunately, there are plenty of excellent software programs available that can help you remain compliant. This is the best way to take the stress out of your next federal contract.
Contact Us to Discuss Your Options
If you’re working on federal contracts that require you to pay the prevailing wage, it’s essential to reduce your costs as much as possible. If you can’t lower your labor costs, you won’t be able to offer competitive bids on contracts. Fortunately, a Davis Bacon Pension Plan can help you avoid the financial repercussions of the Davis Bacon Act.
At Davis-Bacon, we help our clients use pension plans to increase their profitability. If you’d like to discuss our services, contact us at (425) 889-8855.