Program changes effective October 1, 2009
By law, public agencies must now also withhold final payment (or retainage) on a public works contract until they receive proof that all taxes and industrial insurance premiums due for the work have been paid. (This is in addition to the existing requirement for each contractor and subcontractor to have an approved Affidavit of Wages Paid prior to release of project retainage.)
Public agencies must not pay any retained funds to the contractor without an approved release from the Department of Labor & Industries (L&I) Industrial Insurance Program. (Contracts less than $35,000 are excluded from this requirement.)
NOTE: The prevailing wage Affidavit of Wages Paid form continues to be required from all contractors and subcontractors prior to release of project retainage. See RCW 39.12.040.
When the awarding agency receives L&I’s Industrial Insurance Program approved release (in conjunction with the approvals from the Department of Revenue [DOR] and the Employment Security Department [ESD]), and all the prevailing wage Affidavit of Wages Paid requirements of RCW 39.12.040 have been met, they may pay retained funds according to the instructions provided by each approving agency, L&I included.
Questions?
Please review our list of Frequently Asked Questions. If you still have questions, please contact L&I directly:
Phone: 360-902-5772
Email: ContractRelease@Lni.wa.gov
Background:
The 2009 Washington State Legislature added industrial insurance to the retainage and release laws for public works projects (HB 1555). The change was made to help combat the serious impacts of the underground construction economy.
Public Works Release allows L&I to collect industrial insurance debt owed by contractors who are working on public works projects valued over $35,000. L&I has been given the authority to collect the debt from the 5% of the contract that the awarding agency retains. DOR and ESD already have similar processes in place. Enforcement by L&I began October 1, 2009.
Contractors are already required to file an Affidavit of Wages Paid when work on a public improvement contract is complete. The Affidavit is a significant source of information for the contract release function. The Affidavit shows the hours worked and wages paid, by occupation, on the contract. Addendum B to the Affidavit also lists all subcontractors. Thus, the General Contractor’s Affidavit lists all subcontractors with whom the general contractor contracted. Any Affidavits filed by the first level subcontractor lists any second level subcontractors with whom they contracted, and so on. The public body cannot release retainage without an approved Affidavit from all contractors involved with the project.
Questions?
Please review our list of Frequently Asked Questions. If you still have questions, please contact L&I directly:
Phone: 360-902-5772
Email: ContractRelease@Lni.wa.gov
Requests for L&I’s approval for release of retained funds
Immediately after acceptance of work, complete L&I form, “Notice of Completion of Public Works Contract” [F215-038-000] and submit it to L&I for review and approval. The form is also available in other formats.
Department of Labor & Industries
Contract Release
PO Box 44274
Olympia, WA 98504-4274
Fax
360-902-6897
Can we complete this process online?
Not yet. For now, L&I will review the printed forms manually. An effort is underway to create an online process that will make it easier for you to do business with all the approving state agencies for retainage release. When the online process is ready, access will be provided via this web page.
Questions?
Please review our list of Frequently Asked Questions. If you still have questions, please contact L&I directly:Phone: 360-902-5772
Email: ContractRelease@Lni.wa.gov
Resources
Public Works Basics – Prevailing Wage
Find out what a "public works" job is, what "prevailing wages" are and how they are determined. Also, learn about filing requirements, contract amount and when to file Intents and Affidavits for paying prevailing wage on public works projects.
Workers' Compensation Basics – Register and Report
What is workers' compensation (industrial insurance) and how do you get signed up for it? What do you have to pay and how is it calculated?
Awarding Agencies
Information for agencies awarding contracts for public works projects. File Intents and Affidavits or view approved Intents and Affidavits posted here on the Internet for public agencies, contractors, and the general public to view and print.
Contractor Information
What are the responsibilities of contractors who perform work that requires a contractor license?
Questions?
Please review our list of Frequently Asked Questions. If you still have questions, please contact L&I directly:
Phone: 360-902-5772
Email: ContractRelease@Lni.wa.gov
