How to Report Salaried Employees on Certified Payroll: WH-347

To report a salaried employee on certified payroll, you convert their salary into an hourly rate, match the physical work they performed to a trade classification on the project’s wage determination, and list them on Form WH-347 with daily hours, gross pay, deductions, and net pay, exactly as you would an hourly worker. The extra work with salaried people is the math: their pay isn’t already broken into hourly increments, so you have to build the hourly equivalent yourself every week and prove the numbers meet the prevailing wage.¹

First, Confirm the Worker Actually Belongs on the Payroll

Not every salaried person on a federal construction project needs to appear on the certified payroll. The test is what the person does on the site of the work, not their title or pay structure. Under 29 CFR Part 5, anyone performing the duties of a laborer or mechanic on the site is considered “employed” for Davis-Bacon purposes, regardless of their classification for other purposes.²

A salaried project engineer who reviews drawings and never touches a tool stays off the payroll. A salaried superintendent who spends a chunk of the week hanging drywall or pulling wire goes on it. The bright line for supervisors and foremen is the 20-percent rule: if they spend more than 20 percent of a workweek on manual construction tasks, all of the hands-on hours must be reported on certified payroll and paid at least the prevailing rate for the trade performed.³ Purely administrative, managerial, or clerical duties don’t count against that threshold.

Match the Work to a Classification on the Wage Determination

Every federal construction contract includes a wage determination listing prevailing hourly rates and fringe benefits for specific trades in the project’s area. When a salaried worker crosses into reportable territory, match the physical work they performed to the correct classification. If your superintendent spent the week doing electrical rough-in, the classification is electrician, not superintendent and not general laborer.

The classification drives the rate, so getting it wrong is not a small paperwork issue. Misclassifying covered workers in clear disregard of the work actually performed is among the situations the Department of Labor treats as grounds for debarment, which bars the contractor from federal contracts for up to three years and comes on top of back-pay liability.⁴

When Trade Work Splits Across the Week

A salaried worker might do carpentry Monday and general labor Thursday. You can pay and report each classification at its own prevailing rate, but only if you keep accurate time records showing how many hours went to each trade. Without those records, the worker must be compensated at the highest prevailing rate among all the classifications they worked in that week. The highest-rate default isn’t framed as a penalty in the regulations, but it usually costs more than good timekeeping would.

Convert the Salary to an Hourly Rate

The arithmetic is simple; the denominator is where people go wrong. Divide the worker’s total weekly salary by the total hours worked that week on all projects combined, federal and private. Not just the hours on the federal job.

A concrete example:

Weekly salary: $1,500
Total hours worked across all projects: 50
Effective hourly rate: $1,500 ÷ 50 = $30.00

If the prevailing wage for the applicable classification is $35.00 per hour (base plus required fringe), and the worker’s effective rate plus fringe credits reaches only $33.00, you owe a supplemental cash payment of $2.00 for every hour spent on the federal project that week. Redo the calculation every workweek. A salary that clears the prevailing rate at 50 hours may fall short at 35 hours, because the same flat dollar amount over fewer hours produces a higher effective rate while the fringe credits annualize differently.

The common mistake is dividing salary only by the hours worked on the federal project. That inflates the apparent hourly rate and hides a shortfall. A discrepancy between reported hours and actual hours is one of the first things auditors look for.

Fill In WH-347 for the Salaried Worker

Form WH-347 is the Department of Labor’s standard weekly certified payroll form.⁵ Its use is technically optional, but nearly every contracting agency expects it. For a salaried worker, you’ll need the following on hand before you start entering data:

An employee identifying number: the last four digits of the Social Security number or another unique identifier. Full Social Security numbers must not appear on the form.⁵
The work classification from the wage determination matching the physical work performed.
Daily and weekly hours on the federal project, broken out by classification if more than one trade was worked.
Gross weekly salary from all sources, including work on non-federal jobs that week.
Actual employer fringe benefit costs for health insurance, retirement contributions, and other qualifying benefits.

Total hours worked matters here in a way it doesn’t for hourly workers, because it’s the denominator in the hourly rate calculation. Track every hour the employee worked that week on every project. All payroll records and supporting documentation must be preserved for at least three years after all work on the prime contract is completed, including time sheets and benefit invoices, not just the submitted WH-347.²

Applying Fringe Benefit Credits

Employer-paid fringe benefits can close the gap between the effective hourly rate and the prevailing wage. Only “bona fide” fringes qualify: contributions irrevocably made to a trustee or third party for a legitimate benefit plan, or the reasonably anticipated cost of benefits under an enforceable written commitment to workers.⁶

Benefits that generally count:

Medical and hospital coverage
Pension and retirement contributions
Life insurance
Disability and sickness insurance
Vacation and holiday pay
Apprenticeship training program costs

Benefits that do not count toward the fringe credit include workers’ compensation insurance (whether state-required or not), travel and subsistence payments, industry promotion fund contributions, and the contractor’s own administrative expenses for managing benefit plans.⁶ Costs incurred by the insurance carrier or plan administrator to actually evaluate and pay claims can still be credited.

Annualizing the Fringe Cost

Convert each fringe cost to an hourly credit by annualizing it. Divide the total annual cost by the total hours the worker spent on all projects during the year or applicable period.⁷ If the employer pays $6,000 annually for a worker’s health insurance and that worker logs 2,000 hours across all work in the year, the hourly credit is $3.00. Add the credit to the base hourly rate and compare the total to the prevailing wage.

Salaried employees who split time between federal and private work often have benefit costs spread across more total hours than a full-time federal-project worker would, which dilutes the per-hour credit. Run the annualization early so you know whether supplemental cash payments will be necessary.

Unfunded Plans Need Prior Approval

If you fund vacation or sick leave from general company assets rather than through a separate trust or policy, that unfunded plan can still count toward the fringe obligation, but only if the plan is communicated to employees in writing, the cost reasonably anticipates the actual cost of the benefit, and the plan represents an enforceable and financially responsible commitment.⁸ Contractors using unfunded plans must obtain prior approval from the Wage and Hour Division before claiming the credits.

Overtime on Top: CWHSSA

The Contract Work Hours and Safety Standards Act layers an overtime rule on top of Davis-Bacon. For any hours a covered laborer or mechanic works beyond 40 in a workweek on a federal contract, pay at least one and one-half times the worker’s basic rate of pay. The basic rate is the straight-time hourly rate excluding fringes, and it cannot be less than the basic hourly cash rate on the wage determination.⁹

For a salaried worker, that means calculating the effective hourly cash rate (salary divided by total hours worked), comparing it to the wage determination’s basic hourly rate, and using the higher of the two as the base for time-and-a-half. If your salaried superintendent’s effective cash rate is $32.00 and the wage determination’s basic hourly rate is $28.00, overtime runs on $32.00. CWHSSA violations also carry liquidated damages of $33 per worker per calendar day on which an overtime violation occurred, on top of the unpaid overtime.

Owners Who Swing a Hammer

Business owners who perform physical construction work on a covered project are not exempt from prevailing wage requirements. The DOL treats them as “employed” for Davis-Bacon purposes, so they must appear on certified payroll with a trade classification, hours worked, and wages paid, the same as any other worker.¹⁰ For small contractors where the owner works alongside the crew, this catches many people off guard.

One narrow executive exemption exists. An individual who owns at least a bona fide 20-percent equity interest in the business and is actively engaged in its management qualifies as a bona fide exempt executive, and the salary basis rules don’t apply.¹⁰ “Actively engaged in management” means real decision-making authority and supervisory responsibility. An owner with 25 percent equity who supervises nobody, hires nobody, and works long site hours does not qualify.

Submitting the Weekly Report

Certified payrolls must be submitted weekly for every week in which any covered work is performed.¹¹ The regulation doesn’t set a precise number of days after the pay date, so most contracting agencies set their own deadlines in the contract, often within seven days of the pay period. Read your contract’s specific requirements rather than assuming a default grace period.

Many federal projects now require electronic submission through platforms like LCPtracker or Elation Systems. If the agency uses an electronic system, it must accept a legally valid electronic signature on the Statement of Compliance and must allow contractors who can’t use the electronic system to submit by an alternative method.¹¹

Every submission carries a signed Statement of Compliance certifying that wages paid meet or exceed the prevailing rate. That certification has legal weight. Falsifying any part of it exposes the contractor to criminal prosecution under 18 U.S.C. 1001, which carries fines and up to five years in prison.¹² The prime contractor is responsible for ensuring subcontractor payrolls come in as well, so downstream failures land back on the prime.

Treat the weekly payroll as a self-audit rather than paperwork. If the hourly-equivalent math works every week and your time records match reality, a DOL inquiry becomes a records review instead of an enforcement action.

1
U.S. Department of Labor. Fact Sheet 66: The Davis-Bacon and Related Acts
2
eCFR. 29 CFR Part 5 – Labor Standards Provisions Applicable to Contracts Covering Federally Financed and Assisted Construction
3
U.S. Department of Housing and Urban Development. HUD Handbook 1344.1 REV-3 – Davis-Bacon Labor Standards
4
U.S. Department of Labor. Investigative Procedures and Remedies on Davis-Bacon Contracts
5
U.S. Department of Labor. Instructions For Completing Davis-Bacon and Related Acts Weekly Certified Payroll Form WH-347
6
eCFR. 29 CFR Part 5 Subpart B – Interpretation of the Fringe Benefits Provisions of the Davis-Bacon Act
7
eCFR. 29 CFR 5.25 – Rate of Contribution or Cost for Fringe Benefits
8
U.S. Department of Labor. Fact Sheet 66E: The Davis-Bacon and Related Acts – Compliance with Fringe Benefit Requirements
9
eCFR. 29 CFR 5.32 – Overtime Payments
10
U.S. Department of Labor. Field Operations Handbook – Chapter 15
11
eCFR. 29 CFR 5.5 – Contract Provisions and Related Matters
12
Office of the Law Revision Counsel. 18 USC 1001 – Statements or Entries Generally