California has been making strides towards fair labor practices across various industries. Assembly Bill 2143 (AB 2143), requires the payment of prevailing wage and fringe dollars on California’s net energy metering program. This bill went into effect on January 1, 2024, introducing changes that impact California solar companies working on commercial projects over 15 kW. In this blog post, we’ll dive into what AB 2143 entails and how it may affect businesses operating in California.

Key Provisions of AB 2143

Here are some of the key aspects of AB 2143 that businesses should know:

• Expanded Prevailing Wage Requirements: AB 2143 expands the definition of public works projects to include commercial solar projects over 15 kW in California. 
• Apprenticeship Requirements: The bill requires public works contractors to employ registered apprentices on these projects. 
• Registration Requirements: AB 2143 reinforces the existing requirement that all contractors and subcontractors on public works projects must be registered with the Department of Industrial Relations.
• Enforcement: The bill gives the Labor Commissioner more authority to enforce prevailing wage laws and issue penalties for violations. Willful violation can result in revoked eligibility to receive service.
• Public Disclosure: Contractors and subcontractors are required to submit certified payroll records that will be publicly available, improving transparency and aiding in the enforcement of prevailing wage laws.
• Bi-annual Payroll Submissions: Each contractor must submit digital copies of their certified payroll reports bi-annually on July 1st and Dec 31st of each year to the CPUC.

How Does AB 2143 Impact Businesses?

For businesses involved in commercial solar projects in California, compliance with AB 2143's prevailing wage requirements is crucial. Here are a few ways the bill could affect your operations:

• Increased Costs: Ensuring workers are paid prevailing wages can lead to increased labor costs. Businesses need to budget for these costs in their project bids.
• Compliance and Record-Keeping: Maintaining certified payroll records and ensuring they are available for public disclosure requires diligent record-keeping practices.
• Wage Determination Requirements: Utilization of proper wage determinations and incorporation of predetermined increases are a crucial component of compliance on these projects. 
• Apprenticeship Requirements: Contractors need to be aware of their obligations to employ apprentices on public works projects and ensure they are meeting these requirements.
• Penalties for Non-Compliance: Violations of prevailing wage laws can result in penalties, fines, and potential legal action. Businesses need to stay informed and ensure full compliance.

Staying Compliant

• To stay compliant with AB 2143, businesses should take several steps
• Regularly Review Wage Rates: Keep track of prevailing wage rates set by the Department of Industrial Relations for different types of work and regions.
• Train Staff: Educate your team about prevailing wage requirements and the importance of accurate payroll reporting.Monitor Subcontractors: Ensure your subcontractors are also complying with prevailing wage laws to avoid liability.
• Seek Legal Advice: If you have questions or concerns about compliance, consulting with a legal professional specializing in labor law can provide clarity and guidance.Implement
• Effective Compliance Solutions: Using a compliance tool that accurately provides the correct wage determination, automatic predetermined increase allocations, and fringe benefit reports at the click of a button eases the compliance burden that contractors often face. 

Conclusion

California's AB 2143 introduces important changes to prevailing wage requirements for commercial solar projects.  By understanding these new provisions and taking steps to ensure compliance, businesses can avoid potential penalties and contribute to fair labor practices in the state

Contractors Edge simplifies Prevailing Wage compliance by offering patent pending software that saves contractors time and money by providing accurate wage determinations & properly allocating fringe benefits. We can help you to stay informed, keep up with wage rate changes, and prioritize proper record-keeping to navigate these requirements successfully. Contact us today to book a demo!