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Public Bidding Process: Steps to compliance
An advisory from the Office of the Attorney General's Fair Labor and Business Practices Division to the Cities, Towns, Municipalities and awarding authorities throughout the Commonwealth of Massachusetts.
On September 28, 1993, the Massachusetts State Legislature transferred many of the duties performed by the Department of Labor and Industries to the Office of the Attorney General. At the time of the transfer the State Legislature made several important changes to Massachusetts General Laws Chapter 149. One amendment was to M.G.L. c. 149 S 27B. This revised the statute now requires every contractor or subcontractor on public works projects to submit a certified payroll to the awarding authority every week. This is an important new enforcement tool to ensure compliance with the prevailing wage law.
Review of Certified Weekly Payroll
In order for this legislation to be effective, awarding authorities must review and monitor these submissions on a weekly basis. It is the position of the Attorney General's Office that failure by an awarding authority to ensure compliance with this new law frustrates the Legislature's intent to prevent the non-payment of prevailing wage on public works projects. An awarding authority must take an active role in monitoring payroll submissions for this new legislation to realize its intended goal. Any suspected violations should be reported to the Attorney General's Fair Labor and Business Practices Division by calling (617) 727-3465.
Prevailing wage sheets must be included in all job specifications. To avoid any confusion and give notice to all contractors and subcontractors, it is suggested that the requirement for weekly certified payrolls also be included in the same job specifications. However, failure to include the notice of the weekly payroll requirements is no way relieves the awarding authority and contractors from compliance with state law.
Prevailing Wage Hearing
Another legislative amendment to M.G.L. c. 149, S 27 now authorizes the Attorney General's Office, after conducting an investigation and hearing, to order work halted on a public works project if it finds prevailing wage violations. This office can order the general or subcontractor to pass a bond if it finds that the prevailing wage is not being paid on the job. Work cannot resume until the bond has been posted in the amount of a penal sum as determined by the Attorney General at the hearing.
It is readily apparent by these changes in the law, and it is the position of this office, that all awarding authorities must receive, maintain and review weekly payroll records to ensure compliance with the prevailing wage law.
Reviewing Bids
Awarding authorities should also prevent potential prevailing wage violations by conducting hearings on bids that are significantly below the average bid price submitted on a project. Such bids raise a serious question as to the ability of the contractor to pay the prevailing wage, comply with Massachusetts laws, and successfully complete the project. Case law permits awarding authorities to make findings of fact; and such determinations shall not be overturned by the courts or any reviewing agency provided the determination was not made in an arbitrary, capricious, or illegal manner.
Weeding out irresponsible bids will prevent unnecessary and ultimately costly delays. The Commonwealth is covered with public works projects that remain dormant and unfinished because of irresponsible contractors who could have easily been detected by using this process.
Through these preliminary hearings, the contractors must demonstrate to the awarding authorities and its architects how it could complete the project at the bid price and comply with Massachusetts State Laws. Failure to make such a showing would allow the awarding authority to reject the bid. Such action by the awarding authority, absent arbitrary, capricious or illegal behavior, will be supported by the Attorney General's Office.
The legislature has delivered a strong message with its recent amendments addressing enforcement of the wage laws. This office will diligently utilize the new enforcement tools provided to ensure that all parties comply with the law, and that prevailing wage is paid on all public works and public construction projects. However, such oversight is not possible absent the cooperation of the awarding authorities. Inherent in this new statutory scheme is the need for awarding authorities to diligently pursue a role in maintaining and reviewing the weekly certified payroll records.
Please be advised that this office will not be reluctant to employ the sanction of halting such aspects of a public works project if it can be shown an awarding authority failed to prevent violations of the law by not making any effort to maintain and review submitted certified payroll records.
Public Records
The Secretary of State's Office, through an opinion by James W. Igoe, Deputy Secretary of State, Supervisor of Public Records, dated September 12, 1989, and the Office of the Attorney General are in agreement that certified weekly payrolls are public records and therefore should be made available to parties upon request.
Certain information should be deleted or blackened out prior to making the payroll documents available to those who request them in order to protect the privacy rights of named individuals. Sensitive information, such as social security number, date of birth, unusual reason for deduction, i.e., child support, may be deleted or blackened out. Information such as name, address, classification, hours worked, base pay and regular deductions must be made available.
Public construction is one of the essential functions of any government body. Through your assistance you can assure that public works projects are performed legally, efficiently and economically, upholding both the rights of those citizens who work on the project and those of your community who will benefit when the project is completed.
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