Indiana does not have a state prevailing wage law. The legislature repealed the Common Construction Wage Act in 2015, so projects paid for entirely with state or local money no longer carry government-set minimum pay rates for construction trades. Federal Davis-Bacon rules still apply, however, to any Indiana project built with federal funds or federal assistance, and the volume of that work has grown since the 2021 Bipartisan Infrastructure Law. Whether a specific job carries a wage obligation comes down to one question: is any federal money in it?
What the 2015 Repeal Changed
Before July 1, 2015, Indiana’s Common Construction Wage Act (IC 5-16-7) required local wage committees to set minimum hourly rates for each trade before a public project went out to bid. House Enrolled Act 1019 eliminated that requirement.1Indiana General Assembly. Indiana Code 5-16-7.1-1 – Common Construction Wage Statute Contracts awarded before the repeal date still had to honor the old wage schedule; everything awarded afterward falls under the new rules.2Indiana General Assembly. Indiana Code 5-16-7.1-2 – Application and Enforcement of Common Construction Wage Statute After Its Repeal
For a project funded entirely with state or local tax revenue, there is no statewide wage schedule. Contractors pay what the market supports, subject to Indiana’s $7.25 minimum wage, which matches the federal floor.3U.S. Department of Labor. State Minimum Wage Laws Local governments manage their own labor budgets without a state-dictated rate card.
When Federal Davis-Bacon Rates Still Apply
The repeal did not touch federal law. Under 40 U.S.C. 3142, every federal construction contract over $2,000 must include a provision requiring contractors to pay at least the prevailing wage for each trade in the project’s locality.4Office of the Law Revision Counsel. 40 USC 3142 – Rate of Wages for Laborers and Mechanics The U.S. Secretary of Labor sets those rates based on wages paid to workers in similar trades on comparable projects in the same area.
Davis-Bacon reaches well beyond direct federal contracts. Dozens of “related acts” extend the wage requirements to projects that merely receive federal assistance. The common triggers in Indiana include Community Development Block Grants, HOME Investment Partnership funds, Section 8 and public housing projects, and Native American housing programs.5U.S. Department of Housing and Urban Development. HUD Davis Bacon Related Acts Federal highway funds administered through FHWA carry the same obligation.
The 2021 Bipartisan Infrastructure Law added funding to programs already subject to prevailing wage rules, created new programs under the same umbrella, and expressly applied Davis-Bacon standards to projects funded through its energy and infrastructure provisions.6U.S. Department of Labor. Fact Sheet 66A – Bipartisan Infrastructure Law A substantial share of road, bridge, water, and broadband work in Indiana now carries federal wage obligations even though the state imposes none of its own.
How to Look Up the Rate for an Indiana Project
Prevailing wage rates on Davis-Bacon jobs are published as “wage determinations” and vary by county, construction type, and trade classification. An electrician in Marion County will have a different rate than a laborer in Tippecanoe County. A wage determination is a set of wages, fringe benefits, and work rules found to be prevailing for a given labor category in a given locality.7SAM.gov. Wage Determinations
Rates are posted on SAM.gov, formerly the Wage Determinations Online website. If the contract documents already list a wage determination number, you can search by that number directly. Otherwise, search by state, county, and construction type (building, highway, heavy, or residential) to find the applicable schedule. The contract itself must incorporate the correct wage determination, so matching the number against the current SAM.gov listing before bidding is basic due diligence.
Base Rate Plus Fringe: The Full Obligation
Each wage determination has two parts: a basic hourly rate and a fringe benefit rate. The two together make up the total prevailing wage obligation. A contractor can satisfy it by paying the full amount in cash, by funding qualifying benefit plans, or by combining the two.8U.S. Department of Labor. Fact Sheet 66E – Compliance with Fringe Benefit Requirements
If a contractor does not provide benefit plans, the fringe portion must be paid directly to workers as additional cash wages.9eCFR. 29 CFR Part 5 Subpart B – Interpretation of the Fringe Benefits Provisions of the Davis-Bacon Act That is the most common approach among smaller contractors. Qualifying plans generally include health insurance, retirement contributions, and life insurance. Funded plans require irrevocable contributions made at least quarterly to a trustee or third-party administrator. Unfunded plans paid from the contractor’s general assets, such as vacation and sick leave, need prior approval from the U.S. Department of Labor.8U.S. Department of Labor. Fact Sheet 66E – Compliance with Fringe Benefit Requirements
Getting the fringe math wrong is one of the most common Davis-Bacon violations. Contractors sometimes assume their existing health plan satisfies the requirement without comparing the actual per-hour cost against the listed fringe rate. If the plan costs less than the fringe figure, the difference still has to be paid as cash.
Apprentices
Apprentices are the only workers who can legally be paid below the listed rate on a Davis-Bacon project, and only under narrow conditions. The apprentice must be individually registered in a program approved by the U.S. Department of Labor’s Office of Apprenticeship or a recognized state apprenticeship agency. Someone certified as eligible for probationary employment but not yet registered can work at the apprentice rate for only the first 90 days.10eCFR. 29 CFR 5.5 – Contract Provisions and Related Matters
The ratio of apprentices to journey-level workers on site cannot exceed the ratio the contractor’s registered program allows. A worker paid at the apprentice rate without proper registration, or an apprentice working beyond the permitted ratio, must receive the full prevailing wage for the classification of work actually performed.10eCFR. 29 CFR 5.5 – Contract Provisions and Related Matters Fringe benefits for apprentices follow whatever the program specifies; if the program is silent on fringes, the full fringe amount from the wage determination applies.
Weekly Certified Payroll
Every contractor and subcontractor on a Davis-Bacon project submits certified payroll reports weekly to the contracting agency or the entity that transmits records to the funding federal agency.11U.S. Department of Labor. Instructions for Completing Davis-Bacon and Related Acts Weekly Certified Payroll Form WH-347 The standard form is WH-347. Using that exact form is optional, but weekly submission of the required data is not.
Each report must list the worker’s name, an individual identifying number (typically the last four digits of their Social Security number, never the full number), work classification, hourly pay rate, daily and weekly hours, and fringe benefit contributions.11U.S. Department of Labor. Instructions for Completing Davis-Bacon and Related Acts Weekly Certified Payroll Form WH-347 A signed Statement of Compliance on the second page certifies that the data is accurate and that wages meet or exceed the applicable prevailing rates.
Many contracting agencies now accept electronic submissions through dedicated portals; some still require paper. Reviewers compare reported wages against the wage determination, and discrepancies trigger clarification requests. Unresolved issues can hold up project payments. Contractors who wait until the end of a project to reconstruct payroll records almost always end up with errors that attract scrutiny.
Penalties for Getting It Wrong
Enforcement has real teeth. When a contracting officer finds workers are being underpaid, the government can withhold enough from the contractor’s payments to cover the shortfall.12U.S. Department of Labor. Fact Sheet 66 – The Davis-Bacon and Related Acts For serious violations, the government can terminate the contractor’s right to continue work and hire someone else to finish; the original contractor and their sureties are on the hook for any additional costs.13Office of the Law Revision Counsel. 40 USC 3143 – Termination of Work on Failure to Pay Agreed Wages
The most damaging consequence for repeat or willful violators is debarment. The Comptroller General maintains a list of contractors who have disregarded their obligations to employees and subcontractors, and no federal contract can be awarded to anyone on that list for three years from the date of publication.14Office of the Law Revision Counsel. 40 USC 3144 – Authority of Comptroller General to Pay Wages and List Contractors Violating Contracts For a firm that depends on government work, a three-year ban can be a business-ending event.
Overtime violations on covered projects trigger additional exposure under the Contract Work Hours and Safety Standards Act. Contractors who fail to pay time-and-a-half for hours over 40 per week face liquidated damages of $33 per violation.15U.S. Department of Labor. Contract Work Hours and Safety Standards Act Falsifying certified payroll records is a federal crime under the Copeland Act, with penalties governed by 18 U.S.C. 1001.16Office of the Law Revision Counsel. 40 USC 3145 – Regulations Governing Contractors and Subcontractors Whatever a contractor saves by underpaying is dwarfed by the financial and legal exposure.
Purely State and Local Public Works
If no federal money is involved, no prevailing wage obligation attaches, but Indiana’s procurement rules under IC 36-1-12 still apply. Public agencies must award contracts to the lowest responsible and responsive bidder.17Indiana General Assembly. Indiana Code 36-1-12-4 – Bidding Procedures for Projects Costing More Than Certain Amounts “Responsible” generally means the contractor has the financial capacity, experience, and safety record to complete the work. “Responsive” means the bid meets all the technical requirements in the solicitation.
For projects estimated to cost less than $50,000, agencies can use a simplified process, inviting quotes from at least three qualified firms rather than running a full public bid.17Indiana General Assembly. Indiana Code 36-1-12-4 – Bidding Procedures for Projects Costing More Than Certain Amounts The contract still goes to the lowest responsible and responsive quoter. Without a wage floor, labor costs are a pure market variable, which tends to produce wider price spreads than you would see in states that still maintain prevailing wage laws.