Construction Companies: New Hire Payroll Onboarding (2026)

Setting up or managing payroll for construction companies involves more steps than the basic payroll guides cover. Davis-Bacon certified payroll for federally funded projects, state prevailing wage, union fringe benefits, workers comp class codes applies on top of standard federal requirements.

This guide covers the specific payroll setup and management requirements for construction companies.

Step 1: Get Your Employer Accounts Set Up

Before running payroll for construction companies, you need an Employer Identification Number (EIN) from the IRS, a state employer withholding account in each state where you have employees, and a state unemployment insurance (SUTA) account. For construction companies operating in multiple states, this means separate registrations in each state.

Step 2: Configure Pay Types for Construction Companies

Construction Companies have non-standard pay types that require specific configuration: prevailing wage compliance, certified payroll, union vs non-union, seasonal crew cycles. Each of these must be set up as a separate pay code in your payroll system with the correct tax treatment applied.

Missing this step means your system calculates overtime incorrectly, applies the wrong withholding rate, or misses required reporting -- and you do not find out until you receive a penalty notice or employee complaint.

Step 3: Set Up Compliance Tracking

Construction Companies payroll compliance requires: Davis-Bacon certified payroll for federally funded projects, state prevailing wage, union fringe benefits, workers comp class codes. Each of these has filing deadlines, rate requirements, or calculation rules that must be maintained current.

Set up a compliance calendar that tracks: tax deposit deadlines (semi-weekly or monthly based on your lookback period), quarterly Form 941 due dates, annual Form 940 due dates, state quarterly filings, and new hire reporting requirements.

Step 4: Run Payroll and File on Time

With accounts set up and pay types configured, run payroll on your selected frequency. For construction companies, bi-weekly or semi-monthly works for most salaried staff. prevailing wage compliance may require different frequency or supplemental runs.

Tax deposits must be made on the IRS schedule -- either semi-weekly (if your lookback period tax liability exceeds $50,000) or monthly (if less than $50,000). Missing the deposit date triggers the IRS failure-to-deposit penalty.

The Faster Path: Managed Payroll for Construction Companies

BEG managed payroll handles all of the above for construction companies at $25-$45 PEPM, all-inclusive. Setup takes 3-5 business days. We configure your pay types, establish your tax accounts, and run your first payroll on schedule.

Frequently Asked Questions