A statement of compliance certifies all laborers and mechanics employed by a contractor and subcontractor on projects funded by the federal government are being paid the prevailing wage rate, including fringe benefits, for similar area projects as determined under the Davis-Bacon Act.
The Davis-Bacon Act authorizes the Department of Labor to determine the prevailing wage rate contractors and subcontractors must pay their laborers and mechanics working on government funded construction projects or District of Columbia contracts in excess of $2,000.
The contractor or subcontractor must keep payroll records indicating the amount of wages and any fringe benefits paid to laborers and mechanics under the Davis-Bacon Act.
Fringe benefits may be paid by the contractor or subcontractor either directly to the laborer, to an approved plan or fund, or a combination of both. Funded plans are not part of the contractor's business and are administered by third parties or trustees. Non-funded plans are part of the contractor's business such as a vacation fund.