Prevailing Wage Savings Calculator
During 2014 our clients contributed over $15 million in prevailing wage fringe benefit supplements to our bona fide health & welfare and retirement programs resulting in an estimated $3.75 million in savings. In 2015 we expect this number to grow by 50%.
To calculate how much your company may be able to save you can use our simple savings calculator as a starting point.
Your labor payroll burden factor (expressed as a percentage) is one of the key components to calculating your potential savings. This is the cost of paying payroll related taxes and premiums such as FICA, Workers Compensation and liability insurance (if premiums are based on payroll rather than sales). For a simple example a contractor may have the following cost:
- FICA: 7.65% of covered payroll
- Workers Comp: 10% of covered payroll
- Liability Premiums: 10% of covered payroll
- Total: 27.65%
This means that for every hundred dollars of payroll, you are required to pay $27.65 in added cost. By shifting prevailing wage fringe benefit contributions out of payroll and into bona fide benefit programs, you save the labor payroll burden on those dollars.
In an industry known for tight margins and stiff competition, implementing a bona fide benefit program can be the winning difference in your next bid!
If you have additional questions please do not hesitate to contact us or download our whitepapers – “Harnessing the Power of Supplemental Unemployment Benefit Plans” and “Working the Fringe.”
Please also view our short animated video, to see how constructing a bona fide fringe benefit plan, can move prevailing wage dollars out of payroll and reduce associated costs. Increase profits. Submit more competitive bids. Build employee loyalty.
How we can help
DirectAdvisors, established in 2001 and located in Albany, New York provides bona fide benefit plan consulting and third party administrative services to merit shop (non-union) construction companies that are subject to the Davis-Bacon Act, Service Contract Act and state prevailing wage regulations. Our clients are located throughout the United States and range in size from 10 to 3,000 employees.
In 2015, our construction company clients will contribute millions of dollars of prevailing wage fringe benefit contributions to The DirectAdvisors Trust (health & welfare benefits) and retirement plans managed by our team.
Our solutions are free from any conflict of interest as we do not sell any financial or insurance products. We work with existing agents, brokers and insurance companies.
NOTE: The views expressed in this blog are matters of opinion expressed by DR Pension Services, LLC and DR Advisory Services LLC (d/b/a DirectAdvisors) and do not constitute legal or other advice upon which the reader is entitled to rely.