Article 9 of the Labor Law requires that public work contractors and subcontractors pay a building service employee under a public agency building service contract the applicable prevailing rate of wages and supplements (fringe benefits). The Department’s Bureau of Public Work is responsible for the enforcement of Article 9 of the Labor Law.
To be within the coverage of Article 9 of the Labor Law, the work in question must be building service work that is performed pursuant to a public work contract. The term “building service work” includes “work performed by a building service employee” and is not limited to work in or on public buildings, as long as the work is being done pursuant to a public work contract. For example, contracts for municipal garbage or refuse collection, municipal leaf removal, and custodial services on private buildings leased by public entities are subject to Article 9 of the Labor Law.
To be a public work contract, two conditions must be satisfied:
In general, all building service contracts entered into by the State, a public benefit corporation, a municipal corporation, any commission, or any school district are subject to the wage and hour provisions of Article 9 of the Labor Law.
Q: What is a "building service contract"?
A: The term “building service contract” means contracts between a contractor and a public agency in which the principal purpose is to furnish services through the use of building service employees. Article 9 of the Labor Law applies to all building service contracts in excess of $1,500.
Q: Who is a "building service employee"?
A: A "building service employee" is any person performing work in connection with the care or maintenance of an existing building.
Q: What are the occupations of a "building service employee"?
A: “Building service employee” occupations include, but are not limited to, watchman, guard, doorman, building cleaner, porter, janitor, gardener, groundskeeper, elevator operator and starter, window cleaner, and occupations relating to the collection of garbage or refuse, and to the transportation of office furniture and equipment, and the transportation and delivery of fossil fuel.
Q: What is a "public agency"?
A: Article 9 of the Labor Law applies to all building service contracts with a public agency. For that purpose, a public agency is the State, any of its political subdivisions, a public benefit corporation, a public authority or commission or special purpose district board appointed pursuant to law, and a board of education.
Q: What is the "prevailing wage”?
A: The prevailing wage rates are set by the Commissioner of Labor and published each year on July 1. That rate remains in effect until June 30th of the following year. Contractors are responsible for any corrections or updates posted to the annual schedules at the first of every month. Contractors performing public work must pay the rate applicable on the day the work is performed. The prevailing wage includes an hourly amount for wages and supplements.
Q: Who is required to request prevailing wage schedules?
A: For every building service contract, the public agency must file a statement identifying the types of employees and work to be performed by submitting a Request for Wage and Supplement Information form (PW 39) to the Bureau of Public Work. All building service contracts between a government entity and a contractor must contain these schedules.
Q: What are "wage supplements"?
A: Supplements are fringe benefits including medical or hospital care, pensions on retirement or death, compensation for injuries or illness resulting from occupational activity, or insurance to provide supplemental unemployment benefits, life insurance, supplemental disability and sickness insurance, accident insurance, vacation and holiday pay, cost of apprenticeship or other similar programs and other bona fide fringe benefits not otherwise required by federal, state or local law.
Q: How are vacation time, sick time, and holidays calculated for part-time employees?
A: Sick and vacation time is prorated based on full-time equivalent hours per workweek. For example, if a 40-hour-per-week full-time employee gets 5 vacation days, a 30-hour-per-week part-time employee would get 3.75 vacation days. If a paid holiday is not a regular work day, no pay is required. You should refer to each individual classification’s wage schedule for specific criteria.
Q: How does an employer comply with the portions of the wage schedule that refer to sick, vacation, and holiday, etc. leave on an Article 9 Public Work building service project?
A: Labor Law §195.5 requires that employers notify employees in writing or by publicly posting their policy on sick leave, vacation, personal leave, holidays and hours. Such policies must comply with the requirements of Article 9 and the applicable wage schedule. If an employer’s policy does not normally offer such benefits, the employer may either provide the appropriate paid time off as dictated by the schedule, or provide a prorated financial amount corresponding to the time on the building service contract.
Q: Are supplemental benefits required to be paid, on 'paid-time-off' such as sick, vacation, or holiday?
A: No, unless stipulated in the schedule, supplemental benefits are based on the hours worked by the employee.
Q: If supplemental benefits are based on longevity, is the employee's anniversary date the date of hire with the company or on the public work contract?
A: The anniversary date would be the date of hire with the company, unless stipulated differently in the schedule.
Q: What information are the prevailing wage rates in an Article 9 schedule based on?
A: The rates are determined from information obtained from collectively bargained agreements and the Department of Labor’s Division of Research and Statistics.
Q: Is there any “service work” that is not covered by Article 9 wages?
A: Work performed for a contractor under a contract for the furnishing services by radio, telephone, telegraph, or cable companies, and any contract for public utility services, including electric light and power, water, steam and gas are not covered. Also, any construction type repairs or service are the work of laborers, workers, or mechanics, and are subject to Article 8 of the Labor Law.
Q: Does Article 9 apply to public employees?
A: No. A public entity that utilizes its own employees to perform building service work is not required to pay those employees the prevailing rate of wages, provided that those employees are in graded and classified civil service titles.
Q: Are owner/operators required to be paid prevailing wages?
A: True sole proprietors, owner/operators, and LLC managing members are not required to 'pay themselves' in accordance with the prevailing wage requirements set forth in Article 9 of the Labor Law. However, individuals who are, in fact, an employee of the contractor are subject to the requirements in Article 9 of the Labor Law.
Q: What limitations does Article 9 impose regarding the number of hours and days worked?
A: Persons engaged in work on a building service contract may not be required to work more than 8 hours in any one calendar day or more than 5 days in any one week. However, all work performed on a building service contract in excess of eight hours in any one day or more than forty hours in any workweek is overtime. For all overtime hours worked, building service workers must not be paid less than one and one-half times the prevailing wage rate.
Q: If a worker receives different hourly rates during the course of a day because he is performing different tasks, what overtime rate is paid when overtime pay is required?
A: The overtime rate owed for all overtime hours worked is based on the prevailing rate for the occupation the employee is working on at the time the overtime hours are worked.
Q: Are coffee breaks considered time worked?
A: Rest periods, for purposes of Public Work, are governed by Regulation 12 NYCRR §220.4. Rest periods of 20 consecutive minutes or less are considered as time worked upon a building service contract. Rest periods include coffee breaks and time for snacks, but do not include bona fide meal periods.
Q: What payroll records are required to be maintained by building service contractors?
A: Article 9 of the Labor Law requires that building service contractors keep and maintain original payrolls or transcripts thereof, subscribed and confirmed to be true, under penalties of perjury, showing the hours and days worked by each employee, the craft, trade or occupation at which he was employed, and the wages paid. Such records must be maintained for not less than three years after completion of the work.
Q: What are the posting requirements for building service contracts?
A: Each building service contractor must post in an accessible location at the worksite the wages applicable to each category of worker performing work on the site.
Q: Are building service contractors subject to the notice of pay requirements of the Wage Theft Prevention Act?
A: Yes. Additional information on those requirements is available on the Department’s website.
Q: What is the liability of a prime contractor for a subcontractor's underpayment?
A: When evidence indicates non-compliance on the part of a subcontractor, the prime contractor is responsible for such non-compliance.
Q: What are apprentices, and may they be used on building service contracts?
A: For purposes of the prevailing wage law, an apprentice is an individual registered in an apprenticeship program which is duly authorized by the Commissioner of Labor. Written proof of the individual registration must be submitted to the contracting public agency prior to the apprentice’s employment.
Q: How may prevailing wage supplements be provided to workers?
A: Building service contracts can provide prevailing wage supplements either through irrevocable contributions to a fund, plan, or program typically maintained by a union or collective bargaining agent or through cash payments in lieu of supplements directly to the building service employees. Additionally, a combination of such payments can be made.
Q: Who may file a prevailing wage complaint? Are complaints kept confidential?
A: Any person interested or any employee organization or the Commissioner of Labor on his or her own initiative may cause a compliance investigation to be made to determine whether the contractor or a subcontractor has paid the prevailing rate of wages and supplements. During an investigation, all efforts are made to keep the name of the complainant confidential.
Q: How is a prevailing wage investigation commenced? What records will DOL request from a contractor?
A: Subsequent to its receipt of a complaint or on its own initiative, the Bureau of Public Work will request certified payroll records, daily time records, proof of payment of wages, i.e., cancelled checks, and proof of the payment and/or providing of supplemental benefits.
Q: In what circumstances would an administrative hearing be held??
A: An administrative hearing is held when a contractor disagrees with the Department’s finding that the contractor was required to pay its employees prevailing wages on a public work project.
Q: If an employee receives a check from NYS DOL for underpayment of wages and/or supplemental benefits recovered from a public work investigation, who is responsible for the tax liability?
A: The tax liability is the responsibility of the employer. The employee may have personal tax liability for the underpayments and interest received, and should seek information from a tax professional or the state and federal tax departments.
Q: Can a contractor be prohibited from bidding or being awarded a building service contract?
A: The New York State Labor Law prohibits contractors who have been debarred for violations of Article 9 from bidding or being awarded building service contracts for a period of five years. A contractor is debarred when two final determinations have been rendered within any consecutive six-year period that such entity has willfully failed to pay the prevailing rate, or one final determination has been rendered involving the falsification of payroll records or the kickback of wages and/or supplements. (Article 9, Section 235, subd.7)
Q: What is a "willful" violation and how is willfulness determined?
A: A building service contractor has willfully violated Article 9 if it knows or should have known that it failed to pay the prevailing rates of wages and supplements. There are several circumstances that constitute willful behavior. Examples include:
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