The short answer
- Total rate = basic hourly rate + fringe. Meet the total for each hour on the project.
- Cash or plans or both. Any shortfall in plan contributions must be paid in cash.
- All hours, including overtime, earn fringe; the half-time premium is on the basic rate only.
- Annualize plan contributions over all hours worked, on Davis-Bacon and private jobs, unless an exception applies.
- Not creditable: your admin costs, benefits other laws require, travel and lodging.
Three ways to meet the same rate
DOL's fringe benefit fact sheet uses this example: a wage determination of $27.00 basic rate + $14.00 fringe = $41.00 per hour. Each of these complies:
| Option | Cash per hour | Plan contributions per hour | Total |
|---|---|---|---|
| All cash | $41.00 | $0.00 | $41.00 |
| Rate as written | $27.00 | $14.00 | $41.00 |
| Mixed | $35.00 | $6.00 | $41.00 |
What doesn't comply: paying $27.00 cash plus a plan worth $10.00 an hour and stopping there. The missing $4.00 must go to the worker as cash.
Overtime: fringes on every hour, premium on the basic rate
Fringe benefits are owed for overtime hours too, at the straight fringe rate. The overtime premium is half the basic hourly rate. Cash paid in place of fringes isn't part of the rate the premium is calculated on.
Using the $27.00 + $14.00 rate, a worker paid all cash works 44 hours:
| Item | Calculation | Amount |
|---|---|---|
| Straight time | 40 × $41.00 | $1,640.00 |
| Overtime hours | 4 × ($27.00 × 1.5 + $14.00) = 4 × $54.50 | $218.00 |
| Total | $1,858.00 |
Paying 4 × ($41.00 × 1.5) = $246.00 for the overtime is more than required, which is allowed; it's simply not the minimum. Separate overtime laws (the Contract Work Hours and Safety Standards Act and the FLSA) set the time-and-a-half rule; check which applies to your contract.
Annualization, worked through
Under 29 CFR 5.25 the credit for a plan contribution is generally its effective annual rate: total contributions for the year divided by total hours worked in the year, on Davis-Bacon and non-Davis-Bacon work. This stops a contractor from paying for a benefit that covers private work out of Davis-Bacon hours.
Example. You pay $7,800 a year toward a worker's health insurance. The worker logs 2,000 hours: 500 on a Davis-Bacon job and 1,500 on private jobs.
| Item | Calculation | Per hour |
|---|---|---|
| Annualized credit | $7,800 ÷ 2,000 hours | $3.90 |
| Not allowed | $7,800 ÷ 500 Davis-Bacon hours | $15.60 |
| Fringe still owed | $14.00 − $3.90 | $10.10 (cash or other plans) |
Compute it per worker when contributions or hours differ. Failing to annualize is one of the violations DOL lists by name.
When you don't annualize
- Defined contribution pension plans with immediate participation and vesting within the first 500 hours worked. No request to DOL is needed.
- Plans that aren't continuous and don't cover both types of work, with DOL's approval of the exception.
What counts as a bona fide plan
- Funded plans: contributions go to a trustee or third party, are irrevocable and are paid at least quarterly. Health, life and disability insurance, pensions and 401(k)s, vacation and holiday funds are typical.
- Unfunded plans (paying benefits from general assets) need DOL approval before you take credit; requests go to [email protected].
- Apprenticeship programs: credit only for programs registered with DOL's Office of Apprenticeship or a recognised state agency, annualized over hours worked by workers in that apprentice classification.
Costs that never count
- Your own administrative costs of running a plan.
- Benefits other federal, state or local laws already require, such as workers' compensation, unemployment insurance and Social Security.
- Travel, subsistence and lodging.
Showing fringes on the 2025 WH-347
The 2025 form shows fringes in two columns on page 1 and a credit table on page 2:
- Column 6B, total fringe benefit credit: hours on the line × the hourly plan credit you claim for that worker. This is for contributions to bona fide plans.
- Column 6C, payment in lieu of fringe benefits: the cash paid instead of fringes that week (hours × the cash hourly amount). Keep this cash out of the rate in column 6A.
- Page 2 credit table: for each plan, its name, type, plan number and whether it's funded or unfunded; then for each worker, the hourly credit per plan and the total. Use annualized amounts here.
- Statement box 5: check it if you pay fringes through plans, cash or both. All cash? Check box 5 and leave the table blank.
- Apprentices: list the registered program on page 2 and the apprentice's level on page 1.
The free generator has fields for each plan and its hourly amount and puts them in the right boxes, and the WH-347 field guide covers every column. In California, the same data goes in the fringe sections of the eCPR XML.
This page summarises DOL Fact Sheet 66E and 29 CFR 5.25 as of November 2026. It's not legal advice. Your wage determination and contract govern; ask the contracting agency or DOL Wage and Hour Division about your situation.
Sources
- DOL Fact Sheet 66E: fringe benefit requirements under the Davis-Bacon and Related Acts
- 29 CFR 5.25: rate of contribution or cost for fringe benefits
Related guides
- Find and read your wage determination
- Apprentice rates and ratios
- How to fill out the WH-347, field by field
- Certified payroll for subcontractors
Questions
Can fringe benefits be paid in cash?
Yes, all or part, as long as cash plus plan contributions meet the total rate for every hour.
Are fringes owed on overtime?
Yes, at the straight fringe rate. The overtime premium is half the basic rate, not half the cash fringe.
Can I count workers' compensation?
No. Benefits required by other laws aren't creditable.
Do I annualize a 401(k)?
Not if it's a defined contribution plan with immediate participation and vesting within the first 500 hours. Otherwise, generally yes.