(650) 332-8623A Guide to New Jersey Prevailing Wage: Rules, Requirements, Rates, FAQs, and More for 2025
Need to know New Jersey’s prevailing wages to keep your company and its workforce compliant? Our guide has everything to get started!
Understanding prevailing wages is essential for New Jersey business owners and leaders taking on public contracts, especially in the construction industry.
Prevailing wage laws help ensure workers on public construction projects are paid wages and benefits comparable to what’s typically earned in their respective locality for similar work in their trade. They’re pivotal in maintaining fair pay standards and avoiding undercutting in the industry.
For employers and workers in the Garden State’s construction sector, getting to grips with these laws isn’t just about fairness—it’s essential to maintaining compliance. After all, adhering to prevailing wage requirements helps businesses avoid hefty fines, legal challenges, and even potential reputational damage.
It also ensures skilled workers are attracted to projects and retained, which actively contributes to construction projects’ overall quality and safety.
In this article, we’ll dive deep into New Jersey’s prevailing wage laws and shed light on key aspects, starting with the basics: what these laws are, who they impact, and their importance to the construction sector.
After that, we’ll explain how New Jersey’s Department of Labor establishes and adjusts prevailing wage rates to keep up with the industry’s pulse. If you’re running a business, staying on the right side of these laws is key to maintaining compliance.
We’ll also share some hands-on advice to help you keep your operations compliant—plus, we’ve got a step-by-step roadmap for you on how to meet prevailing wage requirements, report with precision, and smooth out any bumps you might encounter.
Understanding New Jersey Prevailing Wage Laws
N.J.S.A. 34:11-56.25 et seq
New Jersey's Primary Prevailing Wage Law
The New Jersey Prevailing Wage Act stipulates workers on certain public works projects, including laborers, craftsmen, and apprentices, must be paid the current prevailing wage for the locality where the project is taking place.
Also known as the “Mini Davis-Bacon Act”, the primary goal of the Act is to help protect local workers and employers from the adverse effects of unfair competition by ensuring that wages on public works projects are commensurate with existing local standards. This protection extends to local contractors, safeguarding them against being undercut by out-of-state contractors who might pay lower wages.
1964
When Did New Jersey's Prevailing Wage Law Take Effect?
The New Jersey State Prevailing Wage Act and Regulations (N.J.S.A. 34:11-56.25 et seq) was enacted on January 1, 1964.
NJDOL
Department of Labor & Workforce Development is Responsible for Enforcing Prevailing Wage in New Jersey
The state’s Commissioner of Labor and Workforce Development establishes the prevailing wage rates, which may vary by county and depend on the worker’s experience and the type of work performed. This commissioner is part of the New Jersey Department of Labor and Workforce Development, abbreviated as NJDOL.
$2,000
What's the Minimum Value of Projects Covered by Prevailing Wage Laws in New Jersey?
New Jersey Prevailing Wages for Common Roles
$49.70PAINTER BASE WAGES (STATEWIDE)
The lowest basic hourly rate guaranteed to statewide painter roles is $49.70. This is also the base wage rate given to tampers, smoothers, shovelers, roller boys, and kettlemen.
$37.33PAINTER FRINGE BENEFITS (STATEWIDE)
$49.11BOILERMAKER WAGES (BERGEN COUNTY)
$45.31BOILERMAKER FRINGE BENEFITS (BERGEN COUNTY)
Journeyman boilermakers in Bergen County receive an additional fringe benefit rate of $45.31 per hour. This provides them with a total prevailing wage hourly rate of $94.42.
$64.41CARPENTER FOREMAN BASE RATE (BERGEN COUNTY)
In Bergen County, the prevailing wage rate for a foreman in the carpenter craft is $64.41 per hour.
A foreman is responsible for managing carpentry projects, supervising carpenters, and ensuring work is done safely, correctly, and on time.
$38.73CARPENTER FOREMAN FRINGE BENEFITS
The $38.73 hourly fringe benefit rate for carpenter foremen often includes essential benefits that improve the overall compensation package.
This brings the total prevailing wage rate to $103.14.
$84.92GENERAL FOREMAN BASE RATE
For electricians in the role of general foreman (overseeing 150 or more journeyman workers on site), the prevailing wage rate is $84.92 per hour.
General foremen are experienced electricians who supervise multiple foremen and large-scale electrical projects, ensuring safety regulations compliance while maintaining high quality work standards.
$53.08GENERAL FOREMAN FRINGE BENEFITS
A general foreman in Bergen County receives comprehensive fringe benefits of $53.08 per hour, which contribute to their well-being, financial stability, and career growth.
This brings the total prevailing wage rate to $138.00 per hour.
New Jersey Prevailing Wage Resources
Don’t see the role you’re looking for on our list?
You can view the latest prevailing wage rates for all positions and regions in New Jersey on the Department of Labor and Workforce Development’s Prevailing Wage Rates page.
New Jersey Department of Labor and Workforce Development – Current Prevailing Wage Rates
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Typical Fringe Benefits and Calculations
Under New Jersey prevailing wage laws, employers on public projects must provide workers health insurance as a fringe benefit or pay an equivalent hourly amount on top of the base wage if they cannot provide it to the employee directly.
Dental insurance is part of New Jersey’s broader health and welfare fringe benefits package offered to workers on public works projects.
Most dental insurance plans as a fringe benefit cover routine check-ups, cleanings, and x-rays. Some may also offer major procedures and emergency dental care, depending on the plan.
Vision insurance is often included as a fringe benefit for workers in fields like construction where clear vision is crucial for safety and work performance.
Coverage typically includes routine eye examinations to detect vision problems early. Many vision insurance plans also provide coverage for eyeglasses, frames, and specialty lenses.
The cost of premiums are shouldered by employers. If they don’t provide vision insurance, they must pay an equivalent to the worker as an hourly cash benefit to meet the employer’s fringe benefit obligations.
Paid Time Off can be provided directly to workers, or employers can pay the equivalent amount on top of the base wage to complete workers’ compensation under prevailing wage laws in the state.
Vacation days fall within the category of fringe benefits under New Jersey prevailing wage law. Employers may directly provide vacation days or compensate workers with a cash equivalent.
Though less commonly mandated compared to health insurance, PTO, and retirement contributions, tuition reimbursement is typically considered a fringe benefit that supports skills development of workers in specific trades.
If an employer does not offer it, they are not required to pay a cash equivalent unless stipulated as part of a contract or project’s fringe benefit package.
Bonuses are typically considered incentives or discretionary payments or incentives offered based on performance, project completion, or other factors. They are not usually required or regulated by New Jersey prevailing wage laws, and they do not count towards meeting the fringe benefit requirements.
Pension contributions are a key component of fringe benefits in New Jersey as they help workers build their retirement savings beyond their base hourly wages.
Employers may provide a pension plan or retirement benefits directly or compensate workers with the equivalent value of the fringe benefit rate.
Employers can make contributions to 401(k) plans of their employees to fulfill their prevailing wage fringe benefit obligations. Otherwise, they have the option to pay their workers an equivalent cash amount to the fringe benefit.
Employer Responsibilities in New Jersey
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Ensure all workers on public projects are paid the proper and current prevailing wages, determined based on the rates set by the New Jersey Department of Labor and Workforce Development. These rates vary by county and the type of work performed, reflecting collective bargaining agreements and local wage standards.
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Register as authorized public contractors before bidding on any public work, ensuring all subcontractors listed in their bids are registered. This registration is vital for the bid to be considered valid.
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Maintain accurate and accessible records, submit necessary certifications, and ensure all workers are paid according to the set prevailing wages, including the appropriate fringe benefits and overtime rates where applicable.
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Resources and tools, such as registration certificates and guidelines on the NJ Department of Labor’s website, are available to help employers meet these important obligations.
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Employers found in violation of the prevailing wage laws can face possible financial penalties, potential reputational damage, and the potential loss of future public work opportunities.
Penalties for Prevailing Wage Noncompliance
$5,000PREVAILING WAGE LAW VIOLATIONS
Failure to comply with these regulations can lead to severe administrative penalties, including fines of up to $2,500 for the first violation, and up to $5,000 for the second and subsequent violations.
Employers can be disqualified from public work for up to three years. Individuals may face criminal charges in more severe cases, such as falsifying records or hindering the act’s enforcement.
Stop-Work OrdersPREVAILING WAGE LAW VIOLATIONS
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Certified Payroll and Prevailing Wages in NJ
Certified payroll is critical to ensuring compliance with prevailing wage laws. It records that workers on public works projects are paid according to the stipulated prevailing wage rates.
Employers must submit certified payroll records to demonstrate that they adhere to all of the applicable wage requirements for public works projects.
Both workers and employers can better navigate the complexities of prevailing wage laws in New Jersey by understanding these requirements and utilizing available resources and legal channels when necessary.
For more detailed guidance, we advise contacting the New Jersey Department of Labor’s resources or seeking legal expertise.
Navigating Prevailing Wage Requirements in New Jersey
Know Your Rights as a Worker
Know the rates. Try to familiarize yourself with the New Jersey prevailing wage rate for your specific trade or occupation. These rates can vary by county and the exact type of work being performed. The New Jersey Commissioner of Labor and Workforce Development determines these rates, which are often based on the results of collective bargaining agreements.
Report violations. If you suspect your employer is not paying the correct prevailing wage, you can file a complaint. The New Jersey Department of Labor performs audits and site visits to enforce compliance, and workers can report any violations without fear of retaliation.
Workers not paid the prevailing wages can seek legal assistance to recover unpaid wages, costs, and reasonable attorney’s fees. Remember, such legal actions must typically be initiated within six years from when the improper payment occurred.
Know What to Do as an Employer
Register your company and any subcontractors with the New Jersey Department of Labor. Before bidding on any public work, submit the necessary certificates of registration for all listed subcontractors.
Adhere to rate determinations. Request and include the Prevailing Wage Rate Determination from the Department of Labor in your contracts. This determination will specify the wage rates for each trade your project involves.
Maintain accurate records. Keep detailed and accessible records of wages paid on public works projects to demonstrate compliance. These records are vital for audits and should accurately reflect the prevailing wage payments and classifications.
Common Prevailing Wage Challenges for Employers in New Jersey
- Complex Rules: Prevailing wage laws are complicated, especially for small businesses without labor law expertise.
- Heavy Recordkeeping: Keeping detailed payroll records and reports takes a lot of time and resources.
- Risk of Penalties: Not following prevailing wage laws can lead to fines, canceled contracts, and legal trouble.
- Wage Disputes: Workers may face issues with wage payments, leading to disputes and even lawsuits.
- Worker Shortages: Finding skilled workers is tough, making it harder to meet prevailing wage requirements on public projects.
Prevailing Wage Solutions for Employers in New Jersey
- Leverage Technology: Payroll and project management software (like Workyard) designed to handle prevailing wage requirements can help streamline compliance efforts, improve accuracy, and save time.
- Regular Training and Education: Employers should invest in regular training for their human resources and payroll staff to keep them updated on the latest prevailing wage laws and best practices for compliance.
- Effective Subcontractor Management: Establish clear communication and contractual agreements with subcontractors regarding compliance with prevailing wage laws. Conduct regular audits to ensure subcontractors are adhering to the required wage rates.
General Best Practices for New Jersey Prevailing Wages
These best practices can help maintain compliance and uphold fair labor standards:
Determine if your project is covered by the New Jersey Prevailing Wage Act. The Act applies to any municipal government project exceeding $16,263 and public entity projects over $2,000.
Register as a public works contractor before submitting bids or working on public works projects.
Request official prevailing wage determinations. Rates vary by county and are critical for accurate payroll calculations.
Post prevailing wage rates prominently on the job site to inform workers of their entitled wages.
Ensure all your subcontractors are registered and comply with prevailing wage laws.
Looking for other prevailing wage and state-specific labor law guides? Check out these articles:
Final Thoughts
Grasping the ins and outs of New Jersey’s prevailing wage laws is a cornerstone of fairness in the construction industry, profoundly impacting employers and workers.
For employers, it’s far more than just trying to meet regulatory minimums; it’s about building a reputation as a fair and ethical business, attracting top talent, and securing a competitive edge in public project bids.
On the other hand, workers gain a more stable financial footing knowing that they’re compensated fairly for their skills and labor in accordance with local industry standards.
By looking into case studies surrounding prevailing wages, employers and workers alike can glean insights into how these regulations play out in real-world scenarios by learning from both the triumphs and pitfalls that are experienced by others in the industry.
For those eager to dive a bit deeper, a wealth of resources is available to help you better understand NJ’s prevailing wage laws. The Workyard blog features many articles highlighting labor laws across the United States, including those on prevailing wages for different states and detailed guides to state labor laws, including our detailed New Jersey labor law article.
Also refer to authoritative sources like the New Jersey Department of Labor’s website, reputable legal analyses, and industry publications online.
These resources can offer a deeper dive into compliance strategies, legislative updates, and nuanced interpretations of the prevailing wage laws, empowering employers and workers alike with the knowledge they need to thrive within New Jersey’s complex regulatory framework.
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In New Jersey, prevailing wage rates are determined by the type of work performed and the county where the work is done. These rates are established under the New Jersey Prevailing Wage Act, which mandates that workers on public works projects receive compensation that reflects local wage standards.
The prevailing wage law applies to public works contracts funded wholly or partially by public funds. Minimum contract values are set at $19,375 for municipal projects and $2,000 for other public entities.
The New Jersey Department of Labor and Workforce Development establishes these rates based on collective bargaining agreements and local wage standards.
Contractors must ensure they pay the correct prevailing wage rates to avoid penalties, which can include fines or even jail time for severe violations.
These rates are subject to change, so contractors and workers should check the latest information from the New Jersey Department of Labor and Workforce Development for updates on specific wage rates applicable to their projects.
As of January 1, 2024, the minimum wage in New Jersey is set at $15.13 per hour for most workers. This represents an increase from the previous rate of $14.13 per hour in 2023
Effective January 1, 2025, New Jersey’s statewide minimum wage for most employees will increase by $0.36 to $15.49 per hour.
Washington is the state with the highest prevailing wage rates. As of 2024, Washington’s prevailing wage rates for various trades are among the highest in the nation, with some rates exceeding $70 per hour for skilled labor positions, depending on the specific trade and location within the state.
Notable High Prevailing Wage States
- Washington: Known for high prevailing wages across multiple trades, particularly in urban areas like Seattle.
- California: Also has high prevailing wages, especially for construction and skilled trades.
- New York: Prevailing wages are significant in New York City and surrounding counties.
These rates are determined based on collective bargaining agreements and local wage surveys, ensuring that workers on public projects receive fair compensation reflective of the local labor market.
The prevailing wage rate in New Jersey significantly impacts construction costs, particularly for public works projects. Here’s an overview of how these rates influence overall expenses in the construction industry:
Higher Labor Costs
Increased Wages: New Jersey’s prevailing wage rates are generally higher than the state’s minimum wage and reflect local labor market conditions. For example, skilled trades like electricians can earn rates exceeding $60 per hour, including benefits. This increase in labor costs is a direct consequence of the prevailing wage laws, which require contractors to pay workers based on collective bargaining agreements.
Cost of Compliance
Administrative Burden: Contractors must ensure compliance with prevailing wage laws, which involves maintaining accurate payroll records and adhering to specific reporting requirements. This administrative burden can add to project costs, as firms may need to invest in additional resources or personnel to manage compliance effectively.
Market Stability
Reduction of Undercutting: By establishing a minimum wage standard for public projects, prevailing wage laws help prevent underbidding by contractors who might otherwise pay lower wages. This stabilization can lead to a more predictable bidding environment, potentially reducing the risk of project delays or quality issues caused by cost-cutting measures.
Economic Benefits
Increased Local Spending: Higher wages for construction workers can lead to increased local spending, as workers have more disposable income. Studies suggest that New Jersey’s prevailing wage law contributes an estimated $138 to $276 million to the state economy annually, enhancing overall economic activity and potentially offsetting some increased labor costs through greater local consumption.
Productivity Gains
Higher Efficiency: Research indicates that higher wages can lead to increased worker productivity and efficiency. Skilled laborers are often more experienced and capable of completing tasks more effectively, which can mitigate some of the cost increases associated with higher wages. The presence of well-compensated workers may also attract better talent, further enhancing project outcomes.
While the prevailing wage rates in New Jersey contribute to higher initial construction costs, they also promote fair compensation for workers and support local economies.
The overall impact on construction costs is nuanced; while labor expenses increase, potential gains in productivity, market stability, and local economic benefits can help balance these costs. In essence, prevailing wage laws aim to create a fairer labor market while ensuring quality standards in public works projects.
