Public Contractors’ Biggest Threat: Annualization! – How to Calculate Annualization and Make it Work for You!
If you are a Public Works contractor and offer a bona fide prevailing wage plan, you are likely familiar with the concept of annualization. The U.S. Department of Labor prevailing wage resource book refers to annualization as: “The computational method that is used to calculate the hourly rate of benefit plan contributions that are creditable to a contractor’s prevailing wage fringe benefit obligation on covered projects.”
Annualization — If a contractor is doing public work and uses any of the fringe supplements to pay bona fide benefits to their employees, you need to know how to utilize these fringe supplements in a compliant way.