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Labor Compliance Programs - Office of the Director

Introduction:

Pursuant to Labor Code section 1771.5, the Director of Industrial Relations approves Labor Compliance Programs (“LCPs”) to enforce prevailing wage requirements on public works construction projects.  LCPs enforce prevailing wage compliance on behalf of public agencies that award public works contracts (known as “awarding bodies”), consistent with the policies of the Division of Labor Standards Enforcement.

DIR-approved LCPs are required, among other things, to inform contractors about their prevailing wage obligations, monitor compliance by obtaining and reviewing certified payroll reports, investigate complaints and other suspected violations, and take appropriate enforcement action when violations are found.  LCPs must be approved, may have their approval revoked, and must follow specific reporting and performance standards set forth in regulations adopted by the Director of Industrial Relations at in Title 8, California Code of Regulations, sections 16421 16439.

The Director only approves LCPs that are authorized or required by state statute.  Following the adoption of SB 854 [Stats. 2014, ch. 28, effective June 20, 2014], awarding bodies are only authorized or required to have a DIR-approved LCP under the following circumstances:

  • Legacy programs established prior to 2012 that enforce compliance on all the awarding body’s projects (subject to exemptions in Labor Code section 1771.5(a)) – there are only four such programs: California Department of Transportation (“Caltrans”), City of Los Angeles, Los Angeles Unified School District, and County of Sacramento.
  • LCPs required for public works projects funded by Proposition 84 (Safe Drinking Water, Water Quality and Supply, Flood Control, River and Coastal Protection Bond Act of 2006)
  • LCPs required by statute for public works projects which were started prior to January 1, 2012 and are still on going

DIR does not regulate other labor compliance programs (a term which may refer to any kind of system or program for monitoring or enforcing compliance with prevailing wage laws).  Awarding bodies are free to establish and operate their own labor compliance programs, but DIR only approves and oversees awarding body LCPs that are authorized or required by state statute.  Under current law, an awarding body may contract with a third party to administer a DIR-approved LCP, but DIR will only designate the awarding body (and not the third party administrator) as having an approved LCP. 

Labor Compliance Program Information and Resources