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CaliforniaAB 8892025-2026 Regular SessionHouseWALLET

Prevailing wage: per diem wages.

Sponsored By: Phillip Chen (Republican), Heath Flora (Republican), Heather Hadwick (Republican)

Signed by Governor

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Bill Overview

Analyzed Economic Effects

4 provisions identified: 0 benefits, 0 costs, 4 mixed.

Annualize fringe credits on public works

When an employer’s fringe payments are higher on public jobs than on the same employer’s private work, the law requires annualized credit calculations. Annualization is not required if the employer is bound to pay the higher rate on future private jobs, if a project labor agreement requires it, or for payments to the California Apprenticeship Council. Employers get full hourly credit for defined‑contribution pensions on public works if the plan allows immediate participation and vesting within the first 500 hours. Beginning January 1, 2026, any director‑issued exemptions from annualization granted before that date are revoked.

Rules for per diem wage credits

The law spells out what counts as per diem wages on public works. It includes employer-paid health, pension, vacation, travel, subsistence, some training costs, and certain worker‑protection and industry fees only when paid under a binding union contract. Employers get credit for irrevocable contributions to third‑party plans, for actual costs under a written, enforceable plan, and for payments to the California Apprenticeship Council. No credit applies to benefits required by other laws, or to certain fees unless tied to an obligated union agreement. Credits do not lower required straight‑time or overtime hourly pay. Hourly cash pay can be lower only if a union contract allows higher fringe payments, the total pay meets or beats both the prevailing per diem and holiday/overtime rates, and the contributions are irrevocable except to correct an error.

File union contracts for wage decisions

Worker representatives must file signed union contracts, and later changes that affect per diem wages or holidays, with the state labor department. A final draft may be filed temporarily with a sworn statement of the start date. Agreements filed at least 30 days before a bid call can be used to set prevailing wages. Not filing alone does not undo a correct wage decision.

Timing and proof for fringe credits

Employers may claim a credit for a pay period even if the benefit payment is made later, as long as payments are made at least quarterly. Employers must prove credits are calculated correctly. On request, they must give the Labor Commissioner records of hours and benefit payments on private construction. The Commissioner may deny the credit if the employer does not provide the records.

Sponsors & Cosponsors

Sponsors

  • Phillip Chen

    Republican • House

  • Heath Flora

    Republican • House

  • Heather Hadwick

    Republican • House

Cosponsors

  • James Gallagher

    Republican • House

  • Susan Rubio

    Democratic • Senate

Roll Call Votes

All Roll Calls

Yes: 207 • No: 1

House vote • 9/13/2025

Item 15 — Assembly AFLOOR

Yes: 77 • No: 1

Senate vote • 9/10/2025

Item 186 — Senate SFLOOR

Yes: 36 • No: 0

legislature vote • 7/9/2025

Vote in CS56

Yes: 4 • No: 0

House vote • 5/8/2025

Item 151 — Assembly AFLOOR

Yes: 69 • No: 0

legislature vote • 4/30/2025

Vote in CX25

Yes: 14 • No: 0

legislature vote • 4/2/2025

Vote in CX14

Yes: 7 • No: 0

Actions Timeline

  1. Chaptered by Secretary of State - Chapter 626, Statutes of 2025.

    10/11/2025Senate

  2. Approved by the Governor.

    10/11/2025legislature

  3. Enrolled and presented to the Governor at 3 p.m.

    9/24/2025legislature

  4. Senate amendments concurred in. To Engrossing and Enrolling. (Ayes 77. Noes 1. Page 3449.).

    9/13/2025House

  5. Joint Rules 61(a)(14) and 51(a)(4) suspended. (Ayes 59. Noes 20. Page 3413.)

    9/13/2025House

  6. In Assembly. Concurrence in Senate amendments pending.

    9/10/2025House

  7. Read third time. Passed. Ordered to the Assembly. (Ayes 36. Noes 0. Page 2812.).

    9/10/2025Senate

  8. Read second time. Ordered to third reading.

    9/8/2025Senate

  9. Read third time and amended. Ordered to second reading.

    9/5/2025Senate

  10. Read second time. Ordered to third reading.

    8/20/2025Senate

  11. From committee: Be ordered to second reading pursuant to Senate Rule 28.8.

    8/19/2025Senate

  12. From committee: Do pass and re-refer to Com. on APPR. (Ayes 4. Noes 0.) (July 9). Re-referred to Com. on APPR.

    7/9/2025Senate

  13. In committee: Set, second hearing. Hearing canceled at the request of author.

    6/12/2025Senate

  14. In committee: Set, first hearing. Hearing canceled at the request of author.

    6/11/2025Senate

  15. Referred to Com. on L., P.E. & R.

    5/21/2025Senate

  16. In Senate. Read first time. To Com. on RLS. for assignment.

    5/8/2025Senate

  17. Read third time. Passed. Ordered to the Senate. (Ayes 69. Noes 0. Page 1486.)

    5/8/2025House

  18. Read second time. Ordered to Consent Calendar.

    5/1/2025House

  19. From committee: Do pass. To Consent Calendar. (Ayes 14. Noes 0.) (April 30).

    4/30/2025House

  20. From committee: Do pass and re-refer to Com. on APPR. with recommendation: To Consent Calendar. (Ayes 7. Noes 0.) (April 2). Re-referred to Com. on APPR.

    4/3/2025House

  21. Referred to Com. on L. & E.

    3/3/2025House

  22. From printer. May be heard in committee March 22.

    2/20/2025House

  23. Read first time. To print.

    2/19/2025House

Bill Text

  • Chaptered

    10/11/2025

    HTML

  • Enrolled

    9/16/2025

    HTML

  • Amended Senate

    9/5/2025

    HTML

  • Introduced

    2/19/2025

    HTML

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