The Huddle - Episode 43 - Certified Payroll
This week the guys round our their series on estimating and bidding by talking about certified payroll and how to avoid any hiccups when bidding certified payroll projects.
Create your FREE Installer profile at https://gocarrera.com and become part of the future of the industry TODAY!
GET TRAINED! Find a list of training dates here: https://gocarrera.com/resources/training/
The HUDDLE is where the flooring industry can get together and talk about everything! Lead by Paul Stuart from Go Carerra who is joined by Daniel and Jose Gonzalez from Preferred Flooring.
what's up
I usually say what's up flooring family I'm going to say what's up skilled professionals out there
uh welcome to the Huddle we're here every Tuesday at 3 P.M Central
where typically Daniel Jose and myself discuss maintaining forward progress in
your flooring career so we're in our last the last part of a of
a kind of a three-part series although it's kind of listed as two uh in
estimating and bidding we've pretty much went over everything but to round it out we're going to talk
about certified payroll projects or the Davis space at bacon act and
um how you as an installer as a subcontract installer uh in particular
uh should you know some of the things you should know uh when when looking at
these types of projects and the paperwork and the requirements that are are there so
Daniel we were chatting offline you guys how do you guys approach your certified
payroll projects or David's bacon projects or do you avoid them all the all the way around we have typically
avoided them all together because uh over here in our area we're the only ones and this is where we kind of had
that little conversation right where like we're the only ones around the area that actually pay our employees
on a W-2 and uh around here it's a lot of the other guys from what I've gathered over
the years seem to think that it's okay to not pay themselves those rates since
they are the owners so there will be like a chain of a sub of a sub of a sub like
everyone on that project is typically their own business or there's just one guy on there and then I don't know how
they get away with it but no one so they all claim yourself up a sub and
and right either that or they they have a team there and it's just nothing is kept track of how
it should which is crazy because you know based on the conversation that I've had with some of these contractors
everything is like super documented so I have no idea how
they do it or what they do but um on some of the projects when my brother and I were working by ourselves
that's kind of how we did it um and the companies that we were doing the work for that's what they told us so they it
was pretty much you don't have to pay yourselves the rates just fill this out and let us know you know the
how much you were paying yourself so that way we can turn it in and that's what we were doing
but that was just you know us by ourselves so I haven't that's something that we
really haven't touched and we've seen you know with the Freedom of Information Act some of the rates that these uh
companies are going in at for prevailing wages
it's like they're going in at under normal rates and how do you even
pay these guys well first off higher rates like that
the the so let's talk about a couple of things a is
[Music] um when you're looking at a certified payroll job
you got to get the wage determination sheet first that wage termination sheet varies so
greatly between counties and jurisdictions um giving an example we got a a large
certified payroll project going on up at Fort Riley and
I think the tile on their pays uh the the wages
58 something 58 62 I believe somewhere
around there so you know if you're if you're looking at
a project and you do and you can install a hundred square foot with you by yourself in a day
and you're and you you have to and and you're gonna cost you know let's call it
fifty dollars an hour well the easy math that's you know on a eight
hour day let's call it real close to 500 bucks and your tile price per square foot is
going to have to be north of five dollars a foot if your average output's 100 square feet
for you to make any any profit outside of paying for yourself and that's not even having a helper
uh or or an apprentice so you know you got to look at these things and and
especially if you're being offered to do a certified payroll job by the square
foot and then you're going to fill out the U.S Department of Labor form which is the certified payroll form
so that's how we do it mainly is we'll have the sub whoever owns that that
subcontracting company um you know they're gonna fill out their own certified payroll forms for each
person that they paid and all the proof of payment you've seen those forms before haven't you Jose or I meant
Daniel yeah Jose was actually just right here he said that he's going to be signing in in a second so just keep a
lookout for him I was putting it in the chat but yeah we filled them out before and
let me see if I can share um Ashton if you're there let me share
let me see if I can share my screen
um
I think you just gotta go up and to participants and make me a host
[Music] s and and what you're talking about too you know that goes beyond just
the certified payroll stuff it's you can get all your rates if you break it down that way to make sure that you're going
to be profitable it's good I'd be looking I I that's a great
Point Daniel is like consider that on all your jobs but particularly when
you're talking about and the reason I say the wage determination is so important is
because the the fact is
in some areas the tile lab for example a tile journeyman tile installer is 29
dollars and in some areas it's 60 bucks I mean it varies that much yeah I think over
here for the tile guys it's I think around 56. and then and then you always have to
look at where our as a you know carpet or resilient Guy
where do you fit in because you're gonna have to go based on something else because we're not in
there yeah most times we're not in there every once in a while you'll find floor layer
on the wage determination otherwise you get lumped in with the painters or
something like that or Carpenters or something because I think over here we're ran with the Carpenters so
you gotta you gotta be careful how you're classifying yourself yeah and you got to make sure you're classifying
correctly too here's a a little tip if you're going to do a certified payroll job if your helper or your your
Apprentice is installing tile and the Corps of Engineers puts in their daily
report that this guy's a tile installer and then you turn in your certified payroll and I'll show you what that
looks like real quick what a report looks like for our audience this is can you see my screen okay
yeah I can see it yeah yeah so this is you know you got your work classification right here and your hours
worked standard and over time each day and then the rate of pay and then the gross earned and then all
your tax stuff and total deductions so this isn't
if if your core of engineer guy labels your Apprentice as a tile Setter which
is typically what they're classified as the or what the classific uh
classifications called within the certified payroll wage determination uh and not a tile finisher which is
typically you know 15 dollars less or so uh if they see them set in tile and they
report them as a tall Setter for those hours they're going to call your blood I
mean they're going to make you redo your certified payroll and pay him the difference that has actually happened to
us where we had a really good Apprentice that was set in tile alongside the
journeyman installers and they classified him as a tile Setter and we
had to go back and pay him tile Setter wages for those hours that he was actually installing
another piece of info is this is a daily work classification
uh or weekly you know you the I guess what I'm saying is this is a weekly work
classification so you could get tied into that rate of pay for a whole week so
the key here is this form is not incredibly complicated to fill out
but you can see it breaks everything down so you got to be the sub has to be
paying their employees as employees and keeping out the FICA taxes and the
withholding tax and any other deductions and then you know you've got to have
they've got to be able to track and provide um proof of all this as well so that
when you get over here you know you got your final amounts
so anyway I thought it'd be helpful just to see what a certified form looks like for those of you who have not
so typically we're going to have our our sub fill that out uh now if we're having
our in-house guys do it then our employee W2 employee installers then we're going to have our office manager
will fill this out based off of their mobile timesheets
yeah I think this is you know some some good information for the guys because a
lot of them you know when you really look at the big picture they don't even keep track of everything in like QuickBooks or anything a lot a lot of
the guys that I you know know personally that around the area their boxer
receipts and you know just putting it in a folder and giving it to uh an
accountant at the end of the year which at least they have an accountant I'll give them that yeah yeah at least they've they've taken some
steps there and there's software out there like you said QuickBooks go career does a lot of
this um you know a fair amount of the work we're going to
be even adding some more features for installers to have more financial tools at their disposal
um or seat capturing and that kind of thing where you can keep a loose set of books if you don't have a full
accounting system like uh QuickBooks but so I guess the biggest
um pieced all this that I wanted to make sure I conveyed to anybody looking at a certified payroll job is to consider
uh the the paperwork when you're you know gonna look at doing a job
you're gonna have to report and a sub of a sub of a sub of a sub the problem is
then you're stuck in with your your GC typically has insurance requirements and
not everybody's going to have you know for a big project say a five million dollar umbrella or something hell we
have a I think an eight million dollar umbrella so you got these big requirements for for jobs that
I mean a lot of Subs aren't going to pay four or five or ten thousand dollars for a year of of liability insurance right
for especially for one project and the other thing is don't get bullied into doing these projects from some of these
contractors because uh we've been in the situation before to where they have us
start on one of these projects and then it isn't until we turn in a bill and then they're like well where's
your certified payroll and you know luckily it was just my brother and I at this point but it's like what what are
you talking about like this should have been communicated way in advance
so just if you think that it's one of those projects if it's on a government
installation whether it's a fort or an Air Force Base you're about a 95 percent
maybe even 100 I don't know that I've ever done a job on on a government
installation we've done the FBI headquarters we've done tons of work at
our air force base and the VA um you know most of those jobs are going
to be certified payroll so before you bid a job ask for the wage determination sheet which that's my point find out
what you're going to have to pay the people that are working for you on that job and find out how you know and I
showed you the the Department of Labor form there's actually a second sheet to
that you can just Google it and it'll come up for you but the the key here is to know what you're getting into and
then consider security it's going to take like when we're going on to an Air Force Base a lot of times
it takes half hour just for the guys to get through the gate and so make sure you're thinking through
the inefficiencies that the government brings to the table I hate to say that don't shoot me Mr government but fact is
is that there's a there they they bring in efficiencies and red tape that when
they come on to the when they're part of the job site um your production will go down I
promise you that and if you're not used to working on government jobs um depending on the core of engineers
and if they're involved or not um I can tell you that one of the things
is inspections do happen on these jobs I I honestly kind of wish this happened on
all projects but uh where we could call in for inspection uh and that we had to
get that written off as part of our our processes in flooring it would add a
level of uh professionalism that the GCS wouldn't be able to push you around you
know you're you're getting you're getting your inspections but for example we just did a set of really big
bathrooms and it had to be waterproofed everywhere and the prep had to be
inspected prior to waterproofing so we had block walls we had to grind down and
get smooth and level and so that had to be inspected prior to waterproofing once
the Corps of Engineers signed off on that then we could start our waterproofing when that's done it got
flood tested and inspected and then when that was done we could finally start installing and it took 48 Hours on both
cases to get those inspections scheduled and in so we lost two days worth of work while we were waiting for one of the
core people to come in and inspect so I don't want to scare people off I'm just trying to give you the reality of what
these jobs require so you know just take that all into account
when you're looking at doing a project like that for a you know one of the large flooring
companies or even if you're considering doing it direct with the GC and you got a good relationship and you're going to
do a job direct with the GC that's fine too just make sure that you you know
have the wage determination realize that Davis bacon and certified payroll go
hand in hand so those two terms are there are other certified payroll jobs
that are not Davis bacon but all Davis bacon jobs are certified payroll right
yep and um with some of these GCS I've talked to some women you know they have an entire
you know Department really I don't know a few people but their accounting team if if you need if you have any questions
on this you can come in and we will pretty much go break it down for you so that way we
know that you know you you're turning in something that we're going to be able to use because if you turn if you're not
keeping track of it they can also get in trouble yeah that's a good point um the fact is is it's in their best
interest for your certified payroll to be accurate and come through so most of them will work with you because
you know it holds up their payment like one small sub can hold up a
multi-million dollar payment just because their certified payroll isn't in or correct or done or whatever so
you know there it just there's more pressure obviously at that point so make
sure you're informed that's what I'm trying to get out here make sure you're informed about the processes and what is
needed um I'm I'm hoping that we're conveying the uh pertinent details but you're
going to have to continue on with whoever you're working for whether it's the GC or the flooring company to get
like we help our subs get our certified payroll done because we have to have it done which the GC has to have it done so
everybody's in This Together uh that is probably the one benefit of it
um but outside of that I would say you know consider again your wage
determination and what the per square foot for labor is and and make sure that
makes sense you know to your daily production time and how much work you think you can get
done in a day um if you're an employee installer working for a flooring company you know
we give our guys some goals to hit and things like that um
because obviously everybody has to stay profitable we got to keep the lights on and people fed and and you got to make
profit for that so um you know I think outside of that the other thing to
consider that I brought up and I think is really important you just don't think about it is the lost time I mean an hour
a day is not excessive to figure in dead time on a project like that and it's and it's not even with uh some of these
certified payroll stuff we were working at uh one of the factories over here they do baby formula
and every like couldn't have any stickers on anything no stickers on hard
hats I was like dang every other job we got to put a sticker on there for safety so go buy some new hard hats then you go
in there up this has uh some wood on it you can't bring that in there and then every tool that is in your toolbox you
have to take out and wipe down before you bring it in the job site yeah that's
yeah I mean that it's worth noting that this is really
about investigating what you're doing like understanding what you're doing
um because to your point we did a we did a MRI room where they were they
kid they weren't shutting the machine down and we had to use ceramic knives with ceramic blades we found a
ceramic hand roller we had the hand roll the whole thing uh that's all made out
of ceramic the entire piece is made out of ceramic um
so yeah there's other crazy uh job application uh things out there or
project requirements out there but um yeah knowing the project is what it
comes down to or at least knowing the requirements and that's really what this is is pointing to is like make sure
you're you're informed on a certified payroll job know where you're at and how you have to report and what you're going
to get paid um I think the best way to do it from if
you know for even a sub pay yourself a weekly amount
uh you know whatever the wage determination is above and beyond and then
um pay pay all your people and the difference is yours right I mean that's
how it works so keeping keeping um
you know I I don't see how a sub of a sub of a sub Works in this scenario and
um I'm sure some guys have figured out how to make it work but that's it's just so messy I can't imagine a GC being real
happy about getting three four different certified payrolls from one company to
do a job but um yeah that's kind of my spill today was just really based around certified
payroll and just the one piece that we didn't get to in the previous discussions and I think there's so much
government work going on it's one of the strongest sectors right now I'm not
saying it's going to continue but I'm just saying right now there's I don't know how it is up in your area but
Across the Nation from a an overall standpoint it seems to be very strong but it does some people at some of the
meetings like um through the the city and the Chamber and this um
a couple of the people in there said I only do government jobs that's like they
started out as private and then once they got into the government jobs they're like that's all I do and all my
referrals come from Strictly government jobs and it's like
that's crazy well if you get somebody who specializes in the paperwork and it's really good I
mean the the my wife does it for us at Stewart and Associates and she's
she's a machine you know um if you're really good at it there's a
good opportunity because not there's a lot of people that just say forget it I'm walking I don't want to mess with it
and so you can have some good margins on those jobs and
um and still you know employees like it like our guys love when they're getting
paid you know another 10 bucks an hour or something to do some work
um as long as you're efficient and you know what you're doing it's not a bad
business it's just you got to know um and be aware and if you are then and
you and you're willing to jump in like those people and and just stick with it um you know if you if you can make a few
more points and you don't have to get beat I mean it's certainly on a job if
you have a Stan if you have a school job on a air force or on a say on a fort you
know an army base uh or that Services the army base and then you have a school
job elsewhere you're gonna have a lot more competition elsewhere I guarantee you that so if you can get good at it
and you want to get good at it you want to invest the time and effort it takes to make sure that you're crossing your
t's and Dot in your eyes then go for it because you can make a little bit of extra money which yeah that's what she
said she said that she got into it not really knowing what what it entailed and then as soon as she got that that first
project and then um she got some you know different certifications behind her like being a woman-owned business and
stuff like that and then that just kind of turned into you know I only want to use you and yeah
we know if you can get those certifications like the small business the minority the
women owned um or stack those up uh you could you there's a lot of government jobs that
have you know 15 to 30 percent up up to 30 percent of a job
uh sometimes it and each one's a little bit different but as far as the requirements but say up to 30 percent of
the job has to be performed by minority women a disadvantaged uh company that
they say yeah if you're out there and you haven't looked into any of these certifications that's definitely something that you
should do because um you know even with us for for a while it was like why would we want to get
this sort of like minority business certification and stuff like that and it's like well they're there for a
reason right if we can use it to our advantage why not hey man amen if you if
you if there's a program out there that will benefit your company do not be too
proud to go do that excuse my French seriously I'll do it and and and
take advantage of I mean it's there someone's going to use it you might as
well there's I don't see I'm seeing it a lot outside of even the government work to where you know these private
companies want to hit a certain percentage of you know disadvantage
adversity yeah so even if you're not going to go for the government work it's it's worth a
shot just to see what else they can bring to the table yep yep I agree and and so you
um your local chamber help you with that yeah we're we're still in the process
right now so through this through the city of Grand Rapids we have what they call a micro local business Enterprise
which um you're only allowed to be in it for 10 years and you have to be
hey he's there and you have to be you know a certain size once you hit a certain dollar amount you're no longer
eligible so it's the same thing with the small uh the small business
the chamber is actually has been um they rolled out a program to where
they're paying to for minorities to get their MBE or wbe you know whatever it is
so the MBE is uh minority business Enterprise wbe is women then they have
the disadvantaged and you know there's there's multiple people
don't we don't know what you said because you're breaking up I'm lbe
just talked about that one but yeah there's a bunch of different uh
you got you know service disabled veteran indian-owned yeah and American the crazy
thing is right now when the the chamber is helping us out and we're trying to
get it but as a Mexican back in the day they wanted to
classify and put us put uh White on our birth certificates
so now I had to go back and they're asking for like my mom's father's
information it's like I don't know like how do you cut through this red tape with stuff like that I have no idea but
yeah I've never done it so I'm interesting it's interesting to listen to you talk about it and yeah so if you
look at our birth certificates it says that we're White well gentlemen we don't speak Spanish we
don't speak Spanish my little run with it I guess well um so but the process
outside of that has it been your chamber would you re you know would you uh
recommend that whoever it may be on this call or or uh consuming our content here
if they're looking to do uh minority status of some sort would you recommend
they go to the chamber and start there I I think the the chamber in general is a
great place to go I mean especially if you're doing a lot of commercial work because you're getting in with all the
builders and stuff there and which is a great place to to meet other
people right because we always talk about networking it's just like that except for it's not
in the industry it's who else can I work with around my local area so like I'll
I'll go to to events he'll go to events he'll join some groups in there they have
like CEO roundtables it's just a great place and then with
the with the with the certification stuff like the MBE they they have their their programs
uh to where they they'll help you out any questions that you have but it this
one is actually through the the city of Grand Rapids is paying for us to get
ours and they hooked up with um a different company
so they're pretty much just the bridge they're like we'll get all the information together set you up with
your own person point of contact and then they help you out so the answer the
short answer is yes chamber and don't go to it wanting to to
um explore becoming a minority-owned business of some sort whether that's
women or or uh race or if it's um service disabled veteran or what any
of those programs get with your local chamber um and and just start there I think
that's probably the best place to start it is because we we met the guy from the
city of Grand Rapids at a chamber event so great working
well it is good networking as well and hey guys sorry I'm so late but man I tell you what switching phone providers
make sure when you're doing your estimate that you calculate some of that man but um
um well we were just talking we we just went over certified payroll Davis bacon
stuff as he was on Facebook listening I was listening on Facebook the whole time
all right well that's kind of the the whole Crux of this uh this episode was
just rounding out the last piece of information that that you know we've hit
bidding and estimating pretty hard a couple of episodes and just kind of
rounded out if you know as you heard while he was on Facebook just being
aware of what you're what you're bidding and uh yes and and know how to follow
the guidelines because they will hold your money 100 guaranteed 100 certified
payroll done and you're the one that's supposed to do it you will not be paid so
um just consider all that and um yeah so
and then we got into a little bit of the of how you become certified uh you know small business or women owned or
minority owned or whatever just because it was a natural kind of uh Segway
effect because we also because we like go on tangents yeah go off on a tangent
it was a good time it was a good one if if you're gonna be you know we are talking about certified payroll so if
you want an advantage of getting some of that work and you feel like you can do that paperwork that I showed it's really
not that complicated but it it can be daunting a little bit um you might as well if you're a
minority or you're a woman you might as well take advantage of that those programs and then you can get even more
government work um and if you're comfortable doing those the certified payrolls and
all that stuff like we talked earlier I mean you can make a a good living doing
that so even if you're not going to be bidding it direct and you have those
certifications with you they the company that is going to be using you can
actually use that certification too and it accounts towards it so yeah so yeah exactly that's a great Point too uh
Daniel is like if if I'm Stuart and Associates doing a government job with
XYZ GC and I hire preferred to do the labor for
me than I get to that their status as long as it's
I can prove this their status counts to the DC's overall percentage status so me
as a flooring company having a minority uh subcontractors that are certified
minority subcontractors I should say uh can give you a bit of an advantage and
I'm just an old white guy gotta take it when you can right that's
right well that's about it for this episode guys uh it actually is shorter even
though every other time I've said that we we tend to fill up the whole hour but
um for short for me sorry again guys I'm sorry about the lack of communication you're good he's not I couldn't hang up
on him man couldn't hang up on him two and a half hours a day well I'll tell you this if if uh
if you were the only one that missed you know I'd pretty much have to shoot myself in the foot if I gave you any
great grief over it so um hey there is one thing too but that I
want to add certified payroll I do remember when Daniel and I first saw split up and went
on our own there we had an opportunity to work with a company um who all they did was a lot of government work and I remember the the
booklet that they gave me of instructions that that were required to follow was about this thick right here
and if I told you guys that going through that and just kind of skim skimming it a little bit didn't deter me
from working with them I'd be lying because once I started reading into it and and it was a foreign language I
pretty much just said nope not for me and I didn't even entertain it so
don't don't be too afraid to to involve yourself into reading the information that that is presented to you right like
I didn't take the time to go through it with a fine-tooth comb and I think if I did it might have approached it a little
bit differently it might have educated me a little bit more so well that kind of goes back to how we
are as humans and our mindset stuff I mean you're if it looks really painful
we just don't do it and you know you you end up
eventually if you end up getting through one you you kind of are like well that wasn't near as bad as I thought it was
going to be um so yeah like I said earlier I mean if you if you can do it and you feel
comfortable doing all the the paperwork by all means jump in don't let any
reluctancy drive you just get to know it I mean a lot of this is just not just
this but everything we talk about is about being teachable and being willing to learn and change
that's that's 90 of what the podcast really talks about just how can you
improve well you can't improve if you don't take some risks and change a little bit and that's the same thing
here it's it's an opportunity judge it for yourself uh and you know determine the risk
factors that we've talked about on this episode and if you feel comfortable with it dive feet first don't be scared of
the book right everything's an opportunity you just
gotta look at it that way and every opportunity is a learning moment for sure well speaking of learning
moments I hope everybody got some uh very specific information but uh I
hope everybody found some some value in this if you did please consider giving us a like subscribing to our YouTube
channel uh if you're watching us on Facebook or Instagram or LinkedIn or any
of the uh different you know media Outlets you know consider giving us a
thumbs up so Eduardo said that dang it's this big [Laughter]
that's funny Kevin uh Kevin said that he's stopping by in two
weeks figure he'd give us a heads up this time
we'll have the box set up for you
all right guys well without uh I guess that'll end this podcast here a
little bit early but uh I appreciate you jumping on late Jose hi there's my job
and uh thanks Daniel I appreciate you guys and and
um we'll see you guys next week and uh probably chat in between so all right
thanks Paul good one all right thanks guys see ya
thank you