WDs can include one of two different health and welfare (H&W) amounts. The lower H&W amount, which became $1.39 per hour on June 1, 1998 is a fixed amount for every hour of work. This payment is for hours up to 40 hours per week or 2,080 hours per year, including vacation, holidays sick pay and any other hour paid. It must be made in cash, fringe benefits, or a combination for every pay period for every employee.

The higher H&W amount is $2,56 average per hour worked. This is an average rate per hour and is counted as straight time and overtime worked, not hours paid. Thus vacation, holiday, and sick leave is not counted. The requirement is only for an average of H&W payments – in cash or fringe benefits – to all employees working contract wide. Thus some employees could receive more or less than the average, even possibly zero as long as the average is met.

Following numerous lawsuits, DOL moved to phase in a singe H&W hourly rate to be paid on a per hour basis similar to the lower-level rate. The new single rate will not be implemented until June 1, 2000. Meanwhile, existing contracts and follow on work covered by the $2.56 per hour rate will be "grandfathered" at that rate until inflation brings the new unified H&W rate to a higher level. Any new contracts will use the new, lower rate which is $1.39 per hour at present but will change annually.

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