The Oklahoma Bar Journal May 2024

APPRENTICESHIP REQUIREMENTS

determinations is www.sam.gov. A taxpayer must ensure all labor ers and mechanics performing “construction, alteration, or repair” of a renewable energy project are paid at rates not less than the most recently DOL-published rates for the specific geographic area, type of construction and precise labor classification. The applicable rates will generally apply throughout the duration of the construction of the project. Owners and developers of renewable energy projects seek ing to obtain these enhanced credits should take certain mea sures at the contract negotiation stage and on a continual basis to ensure the success of claiming the PWA bonus credit. In general, for prevailing wage compliance, the applicable wage determinations should be incorporated within the contract that is awarded to the contractor employing the laborers or mechanics. Further, taxpayers must maintain sufficient evidence demonstrating PWA compliance. The proposed regulations pro vide that contracts should include provisions requiring contractors to submit certified payroll records reflecting the hours worked in each classification, the location and type of facility, the hourly rates of wages paid to each laborer and mechanic (including any cor rection payments made) and the total wages paid to each worker. Limited exceptions are afforded in the regulations to allow for timely corrective payments to be made. Implementing procedures to maintain and preserve accurate records on a continual basis will enable taxpayers to evidence their compliance more efficiently with the PWA requirements during tax filing periods.

year, the alteration or repair of such facility:

The IRA apprenticeship requirements include three com ponents: 1) labor hours, 2) appren ticeship ratio and 3) participation. The Labor Hours Requirement Under the labor hours require ment, the taxpayer shall ensure that: with respect to construction of any qualified facility, not less than the applicable percentage of the total labor hours of the con struction, alteration, or repair work (including such work performed by any contractor or subcontractor) with respect to such facility shall, subject to [Section 45(b)(8)(B)] be per formed by qualified apprentices . 8 the total number of hours devoted to the performance of construction, alteration, or repair work by any individual employed by the taxpayer or by any contractor or subcon tractor and exclude[ing] any hours worked by foremen, superintendents, owners, or persons employed in a bona fide executive, administra tive, or professional capacity (within the meaning of those terms in part 541 of title 29, Code of Federal Regulations). 9 The IRA defines “labor hours” as:

(A)(ii) ... shall be paid wages at rates not less than the pre vailing rates for construction, alteration, or repair of a simi lar character in the locality in which such facility is located as most recently determined by the Secretary of Labor, in accordance with subchapter IV of chapter 31 of title 40, United States Code. 7 Section 1.45-7 of the proposed regulations define the terms laborer and mechanic as meaning: (d)(7) ... those individuals whose duties are manual or physical in nature (including those individuals who use tools or who are performing the work of a trade). The terms laborer and mechanic include apprentices and helpers. The terms do not apply to individu als whose duties are primarily administrative, executive, or clerical, rather than manual. Persons employed in a bona fide executive, administrative, or professional capacity as defined in 29 CFR part 541 are not deemed to be laborers or mechanics. Working foreper sons who devote more than 20 percent of their time during a workweek to laborer or mechanic duties, and who do not meet the criteria for exemp tion of 29 CFR part 541, are con sidered laborers and mechanics for the time spent conducting laborer and mechanic duties. The U.S. Department of Labor (DOL) approved web site for obtaining general wage

The IRA defines “qualified

apprentices” as:

an individual who is employed by the taxpayer or by any contractor or subcontractor and who is participating in a regis tered apprenticeship program, as defined in section 3131(e)(3)(B).

Statements or opinions expressed in the Oklahoma Bar Journal are those of the authors and do not necessarily reflect those of the Oklahoma Bar Association, its officers, Board of Governors, Board of Editors or staff.

26 | MAY 2024

THE OKLAHOMA BAR JOURNAL