Emily Clarke

What is Certified Payroll?

Payroll in a small business is basically your ledger of hours worked to wages paid. A typical payroll process involves comparing hours reported by employees to funds available to be paid out. Hours reported by employees may be submitted through time cards, digital login terminals, or other means. Your ability to make payroll means your ability to cover your obligations to employees for the hours that have been logged based on the agreed-upon wage that you and the employee have in place.

The Need for Certified Payroll

While general payroll processes can be fairly simple depending on the size of your company, certified payroll is a different type of payroll process that involves regulations. Because of this, you may need to invoke the assistance of employee payroll services solutions providers.

Certified payroll is required when your business is involved in government contracts. Any contractor who is involved in a federally-funded project will need certified payroll to satisfy the David-Beacon Act and other laws pertaining to timekeeping involving government funds. The end result of certified payroll is a WH-347 form that will need to be filed along with business taxes.

Prevailing Wage

When meeting certified payroll, you'll need to provide a prevailing wage. This can be defined as the wage paid for work completed according to a wage determination from the Department of Labor. The Department supplies wage data for different regions, work performed, and more. Fringe benefits can be factored in to meet obligations for the prevailing wage in your specific situation and area.

Other Requirements

Additionally, you will need to submit a letter of compliance stating that you have paid the prevailing wage to employees on the contract. You will also need to keep records of your payments for a period of between two and four years.

Payroll Services Make Things Easier

As stated above, it may be beneficial to partner with an employee payroll services provider if you need to provide certified payroll. Your provider can handle all of the details for you, ensuring that your company remains in compliance and is operating within the boundaries of the laws that govern your project.

Author Resource:-

Emily Clarke writes about employee management, benefits and payroll service. You can find her thoughts at payroll platform blog.