Labor Compliance Newsletter - October 2008

This is the second issue of the Labor Compliance Advisor newsletter.  The newsletter is intended to achieve greater compliance and consistency throughout the State in our Federal Aid requirements, primarily with respect to payroll and payroll reporting issues.  Florida Department of Transportation (FDOT) Secretary Kopelousos has established a goal of "One FDOT - We are one agency, united. Central Office and Districts, including Turnpike, we are one DOT working together."  To help make this happen, operational consistency between Districts is essential.  This newsletter is being established as a common communication tool to all of the stakeholders striving to comply with our Federal Aid requirements - those within FDOT, the consultant community and our contracting partners.  It is our common goal to fully comply with applicable Federal Aid requirements and to do so in a manner that is consistent in application, effective in achieving compliance, and efficient in administration.  Hopefully, this newsletter will promote these ideals.




Davis-Bacon Rules (Owner-Operator Truck Drivers)                                                                   Back to Top

Earlier this year, an interpretation from the FDOT Central Office required that each owner-operator truck driver file their own certified payroll.  This was a change from the previous practice of allowing the firm that engaged the owner-operator to file a certified payroll that reported the name of the individual and a notation of "owner-operator" (hours worked, rate of pay, and deductions are not required to be reported for bona fide owner-operators).  After hearing many complaints about an unwieldy certification process, the USDOL was consulted and we have been told that we may accept certifications from the engaging firm rather than having each owner-operator submit their own certification.  However, the engaging firm must have a basis for asserting "owner-operator" on the certified payroll - they must obtain and keep on file proof of truck ownership (a copy of the registration will suffice) and an agreement or affirmation that only the owner will operate the truck.  As an alternative to the agreement or affirmation, if the engaging firm has a reliable record to demonstrate that only the owner operates the truck on the Federal Aid job, we can accept that.


Of course, if the entity engaging the trucking services does not wish to make this certification on behalf of the owner-operator, they may continue the practice of obtaining the certification from the owner-operator.  Also, if the engaging entity has no basis for certifying the owner-operator status (i.e., no documented proof of ownership or knowledge/agreement as to the owner driving the truck), then they must continue to obtain this certification from the owner-operator.


[Editor's Note: It was my interpretation that required each owner-operator to submit their own certification.  This was based on the terms "payroll" and "employee" in the certification, and a literal interpretation of those terms.  By definition, an owner-operator is not an employee and they are not paid through the payroll system.  However, USDOL is willing to accept certifications from the firm that engages the owner-operator.  If it's OK with them, it's OK with me.  I apologize for any difficulties that this may have caused.  Kim Smith]

Enforcement                                                                                                                    Back to Top

In 2007, in a Wisconsin US District Court, the owner of a small trucking firm pleaded guilty to highway construction fraud and was sentenced to 3 months in prison followed by 2 years of supervised release and was required to pay restitution of over $28,000 and fines and assessments of $1,100.  Darrell Kasner owned Kasner's Transport, Inc. in Wood County, Wisconsin.  Kasner's Transport owned two dump trucks and was hired to provide transport services on a Federally-funded project near Winchester, Wisconsin.  Kasner paid his drivers less than the required prevailing wage and caused the production of false certified payrolls to conceal this underpayment.  These documents falsely showed Kasner employees working fewer hours and being paid the prevailing wage.  Mr. Kasner pleaded guilty to a single count of Making False Representations and Reports (a Class D felony).


The submittal of false payrolls can result in serious consequences as described above.  This small business owner no doubt faced difficulty keeping his business while spending 3 months as a guest of the Gray Barr Inn.  A review of the Wisconsin corporate records shows that the company's corporate license became delinquent in the year of the guilty plea and conviction, indicating that the business may have folded.  Even had the business survived, they likely would have faced debarment and been prohibited from public works contracts for a period of three years.  Finding a job as a convicted felon is no easy task either. 


While such penalties may seem severe, the intent is to provide an appropriate deterrent to those that might consider the submittal of false information.  Avoiding these unpleasant repercussions is simple - merely assure that your payroll submissions are complete and accurate.

Equipment                                                                                                                              Back to Top

The skid steer is a versatile, lightweight piece of equipment that is used in many construction activities.  Other names include skid loader, skid steer loader, and Bobcat (the brand name of the original machine manufactured by Melroe Manufacturing).  While the normal, original configuration has a small, front-loading bucket; with various attachments, the skid steer can be used as a backhoe, hydraulic breaker, forklift, angle broom, sweeper, auger, mower, snow blower, stump grinder, tree spade, trencher, dumping hopper, ripper, tiller, roller, snow blade, wheel saw, cement mixer, wood chipper, or even as a grader.  At FDOT we have taken the position that the operator classification is that of a skid steer operator, regardless of the attachment or application.  Currently, none of the General Decisions (wage tables) includes the classification of skid steer operator - this classification must be added through the submittal of an Additional Classification Request by the prime contractor (see the following section for instructions on this process).


The following photos show some of the attachments that make the skid steer the chameleon of the construction site:

Equipment Photos
With an AugerWith a Barrel GrabberAs a Backhoe
Equipment photos


Obtaining Additional Classifications                                                                                         Back to Top

The prevailing wage Federal regulations require that an additional classification be established when there is any class of labors or mechanics which is not listed on the wage determination and which is to be employed under the contract.  The FDOT has established a process for requesting additional classifications, including a form for submitting the request.  These requests are to be submitted by the prime contractor and the prime contractor's representative is to sign the form.  Such added classifications are good only on the contract for which they are requested, and they are good for the life of that contract.

The complete instructions for obtaining additional classifications are in our Contract Compliance Workbook, Chapter 6, Section 6.3, available at this web address:


FDOT Form 700-010-07 is available at the following web address:


The preferred manner of submission for the additional classification request is by e-mail with the form as an attachment (use of the form is optional so long as all information is included).  We ask that your e-mail include a copy to your Resident Compliance Specialist - they frequently are able to identify and resolve issues that would otherwise delay the processing of the request.

 Reporting                                                                                                                                  Back to Top

On October 21, the US Department of Labor issued a Notice of Proposed Rulemaking which proposes a change to the payroll reporting requirements.  If adopted, this change would eliminate the requirement for employers to include the Social Security number and address of employees listed on the payroll.  This change would help guard against identity theft by keeping these sensitive elements of personal information out of the required payroll reports.  This is only the first step in the process - until (and unless) the rule change is adopted, payrolls must continue to include Social Security Numbers and addresses.


If you wish to review the proposal (and possibly submit comments), an excerpt of the Federal Register can be accessed here:


Payroll Notice of Proposed Rulemaking

Recent Developments                                                                                                             Back to Top


The USDOL has proposed that we conduct a wage survey for the highway classifications in Florida in 2009.This survey would help to establish more meaningful prevailing wage rates in our tables and should also result in more classifications being included in the tables (such as Excavator Operator, Directional Boring Machine Operator, and Skid Steer Operator).  That in turn should result in fewer additional classification requests having to be processed.  Please join me in supporting this effort by USDOL and we ask that you assist in this effort by providing additional information when requested.  Thank you...


 Training                                                                                                                                   Back to Top
A training document has been developed to familiarize contractors and subcontractors with the requirements associated with payrolls on Federal Aid projects.  This document has been posted on our web site in both a PowerPoint and Adobe formats.  This may also be used as a training and resource document for FDOT compliance personnel.  The training may be found at the following web address: