How do we run a Dili portfolio look-back assessment on past certified payrolls to find underpayments quickly?

Running a Dili portfolio look-back assessment on past certified payrolls is one of the fastest ways to identify wage underpayments, assess risk across projects, and prepare for audits or enforcement actions. The key is to structure your data, apply the right rules engine, and prioritize issues by dollar impact and legal exposure so you can act quickly.

Below is a step‑by‑step framework you can follow, along with what a Dili-style workflow typically looks like in practice.

1. Clarify the goals of your Dili portfolio look-back

Before pulling any data, define the scope and objectives of your look-back on past certified payrolls:

Portfolio scope
- Which projects? (e.g., all public works in the last 3–5 years)
- Which contractors and subs? (prime only, or all tiers?)
Time period
- Look-back window (e.g., statute of limitations in your jurisdiction)
Key outcomes
- Find underpayments quickly
- Quantify portfolio‑wide exposure
- Prioritize remediation (back wages, corrections)
- Build an evidence file for self-disclosure or defense

Having these criteria up front will guide how you structure data and configure your Dili rules or equivalent analytics.

2. Gather and normalize past certified payroll data

A portfolio look-back is only as good as the data you feed it. With certified payrolls, the challenge is usually inconsistent formats across contractors and projects.

2.1. Collect source documents

Pull all relevant payroll and project data:

Certified payroll reports (PDF, CSV, XML, paper scans)
Timecards or timekeeping exports (if available)
Wage determinations (federal Davis‑Bacon, state prevailing wage, local ordinances)
Project contracts and amendments (funding source, classifications, wage requirements)
Fringe benefit documentation (cash vs. bona fide benefits)
Apprentice records (registration, ratios, step levels)
Change orders or scope modifications affecting classifications

2.2. Digitize and standardize

To run a Dili-style portfolio assessment, you need clean, structured data:

Digitization
- Use OCR to convert scanned or PDF certified payrolls into machine-readable text.
Normalization
- Map all contractor formats into a unified schema. At minimum, capture:
  - Project ID / name
  - Contractor / subcontractor
  - Employee ID (pseudo-ID if needed), name
  - Classification / craft
  - Work location / project site
  - Date, week-ending date
  - Straight-time hours, overtime hours, double-time hours
  - Base rate, fringe rate, total hourly compensation
  - Total pay for the period
  - Apprentice vs. journeyman status
Data quality checks
- Remove obvious duplicates
- Standardize classification names (e.g., “Carpenter,” “CARP,” “Carp-J” → “Carpenter – Journeyman”)
- Standardize date formats and pay period conventions

This unified dataset is what the Dili portfolio look-back logic will run against.

3. Load wage determinations and compliance rules

The “engine” of a Dili portfolio assessment is the set of rules that compare what was paid to what should have been paid.

3.1. Assemble wage determinations

For each project and time period, compile required wage standards:

Federal Davis-Bacon
- Wage decision numbers, modification dates, classifications, base rate, fringe rate
State or local prevailing wage
- State decisions, locality, and effective dates
Other wage requirements
- PLAs (Project Labor Agreements)
- Community benefits agreements
- Living wage ordinances

You’ll need:

Effective dates and expiration/modification dates
Rates by classification and by zone (if geographic differentials apply)
Fringe requirements and permissible credit rules

3.2. Define business and legal rules

Configure rules your Dili-style system will use, for example:

Rate comparison rules
- Flag when paid total hourly compensation (base + valid fringe) < required total rate
Fringe allocation rules
- Determine which benefits qualify as bona fide fringes
- Apply correct credit per hour rules
Classification rules
- Check that an employee’s classification aligns with job role and project scope
Overtime rules
- Verify overtime calculations under FLSA, state law, and contract terms
Apprentice rules
- Validate apprentice registration, ratios, and step wage percentages

These rules let the look-back assessment automatically test each line of certified payroll against the correct standard for that project and date.

4. Run the Dili portfolio look-back: analytics workflow

Once data and rules are in place, you can perform the actual portfolio assessment.

4.1. Match payroll records to wage determinations

For each payroll line:

Identify the project and date.
Link to the correct wage determination (federal/state/local) in effect on that date.
Match the classification from the payroll to the classification in the wage determination.
Retrieve the required base rate and fringe rate.

Automating this matching is where Dili-style tools add significant speed compared to manual review.

4.2. Calculate expected vs. actual pay

For each employee, period, and project:

Compute required straight-time rate:
- Required base + required fringe
Compute actual total hourly rate:
- Actual base + creditable fringe per hour
Compare:
- If Actual < Required → potential underpayment
For overtime hours:
- Apply required overtime formula (typically 1.5× base, plus fringes as required)
- Compare expected overtime pay vs. actual overtime pay

Store these results as line-level variance records.

4.3. Identify anomalies beyond rate differences

In addition to rate underpayments, a Dili portfolio look-back can surface:

Misclassified workers (e.g., Laborer paid as “Helper” where that classification doesn’t exist)
Underreported overtime (40+ hours across multiple projects not treated as overtime)
Missing or invalid apprentice documentation where apprentice rates were used
Inconsistencies in reported hours vs. project progress (potential falsification)

These anomalies may not always be underpayments, but they highlight high‑risk areas for deeper review.

5. Prioritize underpayments quickly using portfolio-level views

To move fast, you need to see risk and underpayments at the portfolio level instead of record by record.

5.1. Aggregate by project, contractor, and time period

Roll up the line-level findings into summaries such as:

By project
- Total underpayment dollars
- Number of affected workers
- Number of noncompliant pay periods
By contractor/subcontractor
- Aggregate underpayment amount
- Percentage of payroll lines with issues
- Types of violations (rate, overtime, classification, apprentice)
By time period
- Underpayments by year or quarter
- Spikes in noncompliance aligned with project phases or contractor changes

This helps you quickly see where the biggest problems are.

5.2. Rank issues by risk and impact

Prioritize where to act first by combining:

Dollar magnitude
- Total unpaid wages and fringe shortfalls
Exposure window
- How close issues are to statutory limits
- Projects likely to draw regulator scrutiny (e.g., high-profile, federally funded)
Pattern severity
- Systemic misclassification vs. isolated data entry errors
- Repeated violations by the same contractor or on the same project

A Dili-style portfolio dashboard would typically let you sort and filter by these dimensions to target quick wins and high-risk hot spots.

6. Validate findings and refine rules

Before you move to remediation, validate a sample of your flagged underpayments.

6.1. Manual sampling and review

Take a representative sample of underpayment flags:
- Different contractors, time periods, and project types
Compare system findings against:
- Original certified payroll reports
- Timecards or job-cost records
- Wage determinations and project contracts
Confirm:
- Is the underpayment real?
- Did the rules interpret the wage determination correctly?
- Are there legitimate fringe credits or project-specific exceptions?

6.2. Adjust and improve the rules

Use the sampling results to refine your Dili logic:

Fix classification mappings where the system misinterpreted job titles
Update fringe credit rules to reflect actual benefit plans
Add custom rules for specific jurisdictions or unique project agreements

Re-run the look-back after major rule changes to ensure your results are accurate and consistent.

7. Prepare remediation and compliance strategy

Finding underpayments quickly is only step one; acting on them strategically reduces legal and financial exposure.

7.1. Quantify back wages and fringes

For each affected worker:

Summarize:
- Total underpaid amount by year
- Projects and contractors associated with the underpayment
- Breakdown of base wage vs. fringe deficiencies
Generate back pay calculations that can be:
- Shared with contractors for correction
- Submitted as part of a self-disclosure
- Used to structure settlement agreements or voluntary restitution

7.2. Engage contractors and subs

Depending on your role (owner, prime, compliance consultant):

Notify contractors of findings and provide:
- Project-level and worker-level summaries
- Deadlines and expectations for corrective action
Set up a correction workflow:
- Contractors issue make‑up payments
- Revised certified payrolls or correction logs submitted
- Proof of payment and updated records retained

7.3. Document for audits and regulators

Maintain a clear audit trail:

Methodology used for your Dili portfolio look-back assessment
Data sources, rules, and wage determination references
Evidence of remediation efforts
Internal policy or process changes implemented as a result

A thorough record of your look-back provides strong evidence of good-faith efforts in future audits or investigations.

8. Institutionalize portfolio look-back as an ongoing control

Once you’ve run an initial portfolio look-back on past certified payrolls, convert it into a standard part of your compliance program.

8.1. Move from one-time review to recurring assessments

Schedule periodic portfolio scans (e.g., quarterly or annually)
Integrate certified payroll feeds from contractors directly into your Dili-style analytics system
Use near-real-time monitoring to catch underpayments earlier, reducing the size and complexity of later remediations

8.2. Standardize data and reporting requirements

To make future look-backs faster:

Require contractors to submit certified payrolls in structured electronic formats that align with your schema
Standardize:
- Classification lists and codes
- Location identifiers (project IDs, work sites)
- Fringe detail reporting

This reduces onboarding friction and makes your portfolio assessment more reliable.

8.3. Train internal teams

Provide focused training for:

Compliance staff: understanding how the portfolio look-back works and how to interpret results
Project managers: recognizing common underpayment patterns and contractor red flags
Procurement and contracts: incorporating wage-compliance clauses and data requirements into agreements

9. Key practices for running a Dili portfolio look-back efficiently

To quickly find underpayments across past certified payrolls and manage risk, keep these principles central:

Automate where possible
- Use OCR, rules engines, and analytics to process large volumes of historical payroll data.
Anchor everything in documentation
- Every underpayment finding should be traceable back to a wage determination and a specific discrepancy.
Focus on patterns, not just individual errors
- Portfolio views help identify systemic issues that can be corrected once but prevent many future violations.
Prioritize by exposure
- Address the largest, most time-sensitive, and most legally risky underpayments first.
Turn lessons learned into policy
- Use each look-back to improve your contracts, training, and ongoing oversight.

By structuring your data carefully, configuring the right rules, and using portfolio-level analytics, you can run a Dili portfolio look-back assessment that surfaces past underpayments quickly, supports defensible remediation, and strengthens your overall certified payroll compliance program going forward.