Twenty four states do not have prevailing wage laws in place, but that number might be changing. As more prevailing wage laws and regulations are enacted across the nation, South Dakota is eyeing its own legislation. Senate Bill 110 of the 2023 South Dakota Legislature, introduced by Senator Nesiba, seeks to put prevailing wage regulations in place within the state on certain contracts.

The proposed legislation would require each contracting state agency to conduct a thorough investigation into labor market conditions to determine the prevailing wages and hours of labor before opening their contracts for bids. Additionally, state agencies would be required to share their findings with the Department of Labor and Regulation, who would then publish the information at each project site. This would make wage information public record, allowing for greater transparency and enabling the creation of comprehensive spreadsheets to highlight the going rates for workers in South Dakota.

Additional information will be needed if law goes into effect as currently written, but currently we know that:

  • The law only to the construction of physical structures and not to the production or delivery of materials or products by commercial establishments.
  • The law does not apply if a project is estimated to cost less than $2,500 and only requires one trade or occupation to complete it OR if a project is estimated to cost less than $25,000 but requires more than one trade or occupation to complete.
  • The Department of Labor and Regulation will enforce the law and can demand all payroll information and any records relating to the payment of wages on projects where the law applies.
  • A violation of this section is a Class 2 misdemeanor.

There does not seem to be information in place about what it takes to apply apart from paying the correct amounts, so information on reporting and compliance in general is currently missing. There are additional gaps in information regarding this legislation, such as what type of action or fine may be applied to those in violation. It’s clear that additional rounds of debate and planning will be needed should this proposal get signed into law.

The material presented here is educational in nature and is not intended to be, nor should be relied upon, as legal or financial advice. Please consult with an attorney or financial professional for advice.