Tuesday, November 29, 2011

Washington Revises Prevailing Wage Policy

The Washington State Department of Labor and Industries has revised its policy on "Filing an Affidavit Form 'On Behalf' of Subcontractor."  

The new policy, dated November 22, 2011, replaces the policy dated August 17. 2009.

Steps and Conditions for Filing by Contractor: The policy describes the steps that a contractor must take before they may file an "Affidavit of Wages Paid" form on behalf of a subcontractor who has gone out of business, is bankrupt, or has refused to file its own Affidavit.  Affidavits must be on file with the public agency awarding a public works project for the contractor and all subcontractors before retainage may be released to the contractor.

What's Different in the Revised Policy?  The major change in the revised policy eliminates requiring the contractor to certify that the workers have been paid the prevailing wages by the subcontractor (something that the contractor may have no basis for certifying).  Instead, the Assumption of Liability Statement which must accompany a hand filled out Affidavit only keeps the language that the contractor agrees to "accept full liability for any unpaid wages owed" by the subcontractor.  There are a few corresponding changes in the policy to address this modification.

Read the Revised Policy:  Click here for a copy of the revised policy.

Obtaining an Affidavit for a Missing Contractor:  L&I's policy does not address what to do if it is the general or prime contractor who has gone out of business, declared bankruptcy, or refused to file the Affidavit.  If you have this situation occur, discuss it with L&I.  In the past, prior to any policy by L&I on the contractor filing an Affidavit on behalf of a subcontractor, I have had the bonding company fill out and sign the Affidavit on behalf of the contractor.  In my opinion, L&I should expand its policy to provide for the surety to file the Affidavit on behalf of the contractor.
Mike Purdy's Public Contracting Blog 
© 2011 by Michael E. Purdy Associates, LLC 

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