Missouri's Prevailing Wage Law

Missouri’s Prevailing Wage Law establishes a minimum wage rate for public works projects in Missouri valued at more than $75,000. Examples of public works projects include bridges, roads and government buildings. The Prevailing Wage Law applies to all public works projects constructed by or on behalf of state and local public bodies and is broken down into 20 broad job classifications. The wages are reported as either “building,” such as typical construction jobs like carpentry, painting or plumbing; or “heavy/highway,” that would include roads and bridges. The prevailing wage rate differs by county and for different types of work.

The prevailing wage rates must be incorporated into contract specifications for all public works jobs. This is the minimum wage rate required for the project although employers are free to pay above the prevailing wage.

Each year, the Missouri Department of Labor and Industrial Relations’ Division of Labor Standards (DLS) requests contractors hired for public works projects to voluntarily complete the Contractor’s Wage Survey by January 31. After that date, DLS calculates the prevailing wage for each type of work and for each county.

The DLS sets wage rates and publishes an Annual Wage Order for each county in Missouri. If fewer than 1,000 hours are provided during the survey process for a specific job in a county, DLS works with the Missouri Economic Research Information Center (MERIC) within the Missouri Department of Higher Education and Workforce Development to determine a public workers contracting minimum wage for the job classification. This wage rate is set at 120% of the average salary for that county.

If at least 1,000 hours per job classification are received for a county, the following weighted average calculation is performed:

In addition to the Annual Wage Order, DLS is required to set an additional wage rate, only used on Missouri Department of Transportation (MoDOT) projects known as the General Wage Order.

Calculation of the Annual Wage Order occurs between February 1 and March 10, with DLS statutorily required to file proposed Annual Wage Order rates by March 10. The General Wage Order for MoDOT projects is filed with the Secretary of State in the middle of May. For 2022, DLS compiled more than 23 million hours (nearly 19 million building and 4.5 million heavy/highway) from 48,615 reports submitted. The statute was changed in 2018 as to how the rates are calculated. This resulted in the previously mentioned MERIC rates or weighted average calculation, where the total wage amounts paid in a job title in each county are divided by the number of hours submitted.

Any party affected by the prevailing wage rate may file an objection to a prevailing wage no later than April 10 with the Labor & Industrial Relations Commission (LIRC). When all objections have been decided, the Division of Labor Standards will release a final Annual Wage Order by July 1. The Annual Wage Order will remain in effect for each county for the applicable occupational categories for the following state fiscal year.

In 2022, DLS modernized the Contractor’s Wage Survey by providing an online submission portal. The portal has provided a much easier method for contractors to report wages and created several efficiencies for the division. The DLS strongly encourages contractors of public works projects to use the online portal throughout the year to expedite the processing of the submissions and calculations for the Annual Wage Order.

The 2018 statute change also included a prevailing wage exemption for small projects that do not exceed $75,000.

One cautionary note: A city may not attempt to circumvent the $75,000 threshold by breaking the project into multiple projects. For example, to build a new steel building that will cost $200,000, a city may not cut up the total project cost by calling for a bid of $74,000 for one portion; another of $72,000 for a second portion; and a third for $54,000. The DLS can assess a $100 per day per worker penalty for failing to pay the prevailing wage. Workers can also pursue a private right of action for double the difference between what they received and what they should have been paid, plus attorney fees.

Information is available for public works contractors, public bodies and workers on the Department’s website at https://labor.mo.gov/dls/prevailing-wage. A Public Works Guidebook is online to provide checklists, forms and a reference to applicable laws. A complaint form is also available for workers who believe they are not receiving the proper wage.

Todd Smith is the director of the Division of Labor Standards and the chair of the State Board of Mediation. Prior to founding Strategic Methods, LLC, a governmental consulting firm, in 2009, Smith had extensive state and local government experience. He served as both director and deputy director of the Missouri Department of Labor and Industrial Relations from 2007-2008. Smith served 14 years in the Missouri House of Representatives and also served as former Governor Matt Blunt’s director of legislative affairs, as well as presiding commissioner of Pettis County.

by Mark Woodward