<< Back To States

Michigan

1. When is the prevailing wage rate used?
2. What is the definition of a public works or related projects?
3. Are there project monetary thresholds?
4. Are any types of projects specifically exempted?
5. What is included in the calculation of wage rates?
6. Who calculates the prevailing wage rates?
7. Enforcement: what are the penalties for violations? Criminal or fines?
8. Can contractors be debarred?
9. Are there posting requirements?
10. Does the agency retain any fines for enforcement (i.e. an enforcement fund)?
11. Record Maintenance?
12. Are there any provisions which discuss apprentices?

 

When is the prevailing wage rate used?
A) Every contract executed between a contracting agent and a successful bidder as contractor and entered into pursuant to advertisement and invitation to bid for a state project which requires or involves the employment of construction mechanics, other than those subject to the jurisdiction of the state civil service commission, and which is sponsored or financed in whole or in part by the state shall contain an express term that the rates of wages and fringe benefits to be paid to each class of mechanics by the bidder and all of his subcontractors, shall be not less than the wage and fringe benefit rates prevailing in the locality in which the work is to be performed. (408.552 Contracts for state projects; minimum wage provisions, exceptions.)

B) Prevailing wage rates are those contractors must pay employees working on state projects, unless federal funds are involved. They apply to construction trades workers on construction projects contracted by the state, a state agency or institution, a school district or college and paid for by state funds or state-supported bonds. (Department of Labor and Economic Growth)

Back to Top


What is the definition of a public works or related projects?
"State project" means new construction, alteration, repair, installation, painting, decorating, completion, demolition, conditioning, reconditioning, or improvement of public buildings, schools, works, bridges, highways, or roads authorized by a contracting agent. (408.551 Definitions.)

Back to Top


Are there project monetary thresholds?
"Contracting agent" means any officer, school board, board or commission of the state, or a state institution supported in whole or in part by state funds, authorized to enter into a contract for a state project or to perform a state project by the direct employment of labor. (408.551 Definitions.)

Back to Top


Are any types of projects specifically exempted?
A) In accordance with the federal Davis-Bacon Act, any project whose value is less than $2,000 is exempt from the prevailing wage laws. (Davis-Bacon Act)

B) There is no state monetary threshold noted in the Prevailing Wage Act of Michigan

Back to Top


What is included in the calculation of wage rates?
A) Wages and fringe benefits. (408.554 Prevailing wages and fringe benefit rates; establishment; public hearings.)

B) Each schedule consists of approximately 90 different classifications of construction trades with a total hourly and fringe rate for straight time, time and a half, and double time. (Michigan Department of Labor & Economic Development)

C) "Fringe benefits" means compensation due an employee pursuant to a written contract or written policy for holiday, time off for sickness or injury, time off for personal reasons or vacation, bonuses, authorized expenses incurred during the course of employment, and contributions made on behalf of an employee. (Michigan Department of Labor & Economic Growth)

Back to Top


Who calculates the prevailing wage rates?
A) The commissioner determines the prevailing wages in each locality where the work is being performed. (408.553 Prevailing wage and fringe benefit rates; schedule as part of specifications and bid form.)

B) "Commissioner" means the department of labor. (408.551 Definitions.)

C) ":Locality" means the county, city, village, township, or school district in which the physical work on a state project is to be performed. (408.551 Definitions.)

D) "The Department of Labor & Economic Growth is required by law to survey road construction and building trades union with collective bargaining agreements to obtain the basic hourly and fringe benefit rates provided in their contracts." (Michigan Prevailing Wage Act Brochure)

Back to Top


Enforcement: what are the penalties for violations? Criminal or fines?
A) The contracting agent, by written notice to the contractor and the sureties of the contractor known to the contracting agent, may terminate the contractor's right to proceed with that part of the contract, for which less than the prevailing rates of wages and fringe benefits have been or will be paid, and may proceed to complete the contract by separate agreement with another contractor or otherwise, and the original contractor and his sureties shall be liable to the contracting agent for any excess costs occasioned thereby. (408.556 Prevailing wages and fringe benefits; failure to pay, termination of contract; contractor's liability and sureties.)

B) Any person, firm or corporation or combination thereof, including the officers of any contracting agent, violating the provisions of this act is guilty of a misdemeanor. (408.557 Violation of act; penalty. )

Back to Top


Can contractors be debarred?
The department may debar a vendor from the consideration for the award of a contract for the provision of goods or services to the State of Michigan or suspend the procurement of goods and services from a vendor if, within the past three (3) years, the vendor, an officer of the vendor, or an owner of a 25% or greater interest in the vendor has:

  • Been convicted of a criminal offense incident to the application for or performance of a state contract or subcontract;
  • Been convicted of any offense which negatively reflects on the vendor's business integrity, including but not limited to embezzlement, theft, forgery, bribery, falsification or destruction of records, receiving stolen property, state or federal antitrust statutes;
  • Been convicted of any other offense, or violated any other state or federal law, as determined by a court of competent jurisdiction or an administrative proceeding, which, in the opinion of the Department, indicates that the vendor is unable to perform responsibly or which reflects a lack of integrity that could negatively impact or reflect upon the State of Michigan. An offense or violation under this subdivision may include, but is not limited to, an offense under or violation of: the Natural Resources and Environmental Protection Act; the Michigan Consumer Protection Act,
  • Failed to substantially perform a state contract or subcontract according to its terms, conditions, and specifications within specified time limits;
  • Violated Department bid solicitation procedures or violated the terms of a solicitation after bid submission;
  • Refused to provide information or documents required by a contract, including but not limited to information or documents necessary for monitoring contract performance;
  • Failed to respond to requests for information regarding vendor performance, or accumulated repeated substantiated complaints regarding performance of a contract/purchase order; or
  • Failed to perform a state contract or subcontract in a manner consistent with any applicable state or federal law, rule or regulation. (VENDOR COMPLIANCE WITH STATE AND FEDERAL LAW)

Back to Top


Are there posting requirements?
"Every contractor and subcontractor shall keep posted on the construction site, in a conspicuous place, a copy of all prevailing wage and fringe benefit rates prescribed in a contract..." (408.555 Prevailing wage and fringe benefit rates; posting by contractors.)

Back to Top


Does the agency retain any fines for enforcement (i.e. an enforcement fund)?
There is no information stating how fines relating to prevailing wage violations are used/distributed.

Back to Top


Record Maintenance?
"Every contractor...shall keep an accurate record showing the name and occupation of and the actual wages and benefits paid to each construction mechanic employed by him in connection with said contract. This record shall be available for reasonable inspection by the contracting agent or the commissioner." (408.555 Prevailing wage and fringe benefit rates; posting by contractors.)

Back to Top


Are there any provisions which discuss apprentices?
"Construction mechanic" means a skilled or unskilled mechanic, laborer, worker, helper, assistant, or apprentice working on a state project but shall not include executive, administrative, professional, office, or custodial employees. (408.551 Definitions.)

Back to Top

References
1.) Prevailing Wages on State Projects (EXCERPT) Act 166 of 1965

2.) Executive order No. 2003-1: Procurement of goods and services from vendorsin compliance with state and federal law

3.) Michigan Department of Labor & Economic Growth
* This is the web-site for the Michigan Department of Labor & Economic Growth.
* The information on this web-site is presented as if it were fact, not opinion.

4.) Michigan Prevailing Wage Act Brochure