Under the Inflation Reduction Act (IRA), contractors are ultimately responsible for ensuring apprenticeship and prevailing wage compliance on their projects. While Apprentix and other partners provide tools and oversight, contractors must take specific steps to remain eligible for enhanced tax credits.
Core Responsibilities
Hire and Register Apprentices
Employ apprentices as W-2 employees (1099 workers do not qualify).
Ensure apprentices are registered in a U.S. DOL-approved program.
Use Apprentix to manage agreements, wage schedules, and status updates.
Maintain Ratios
Follow the 1:1 apprentice-to-journeyman ratio on a daily basis.
If the ratio is not met, pay apprentices at journeyman wages for that day (those hours will not count toward IRA requirements).
Track and Report Hours
Enter apprentice hours weekly into Apprentix.
Ensure logged hours match payroll totals.
Allocate hours to both classroom training and on-the-job training.
Pay Correct Wages
Follow the wage progression outlined in Appendix A.
Ensure wages meet or exceed prevailing wage requirements.
Adjust apprentice wages at required benchmarks (e.g., after 1,000 or 2,000 hours).
Keep Records for 7 Years
Maintain certified payroll records (WH-347).
Keep apprenticeship agreements, wage schedules, and Davis-Bacon certificates in Apprentix.
Document ratio compliance and corrections clearly.
Oversight and Support
Apprentix: Manages apprenticeship program documentation, registration, and reporting.
Payroll Providers: Handle prevailing wage compliance and certified payroll reporting.
Compliance Auditors: Independently review documentation to verify IRA compliance for project owners.
Why This Matters
Failing to meet these responsibilities can lead to:
Penalties of $50–$500 per noncompliant hour.
Loss of enhanced IRA tax credits.
Increased scrutiny on future projects.
By staying proactive and using Apprentix, contractors can ensure every apprentice hour counts and compliance risks are minimized.