Construction workers walk off Omni Louisville site protesting wage discrepancy

May 24, 2017 12:53 pm


Some of the construction workers who are helping erect the more than $320 million Omni Louisville hotel and luxury apartments walked off the site this morning.

Roughly 100 workers who have been installing metal studs and hanging drywall at the Omni claim that they are being paid roughly $20 less an hour compared with other construction workers on the job, WDRB News first reported.

Marco Cruz, one of the workers who walked off the construction site, told Insider that he is not so much upset that they are making less than other workers as he is troubled by the fact that they were told they’d earn $24 an hour but are only receiving $17 to $20 an hour.

“I saw that that’s not right,” he said. “We feel like they are taking advantage of us.”

Louisville labor attorney Dave Suetholz told Insider in a phone interview that the construction workers, most of whom are Hispanic immigrants, were told that their wages were lowered because Gov. Matt Bevin repealed Kentucky’s prevailing wage statute this year.

Suetholz, an attorney with Kircher, Suetholz & Associates PSC, argued that construction on the Omni “started before the repeal of the prevailing wage,” making the argument invalid.

“Their employer has lied to them,” he said. “It’s all immigrant workers. They are the only ones being paid lower rates. …Just on the face, it looks very bad.”

The prevailing wage law required construction workers to be paid a wage and receive benefits comparable to what workers receive on average construction sites in the area. It applied to public construction projects, according to an article by Stites & Harbison attorney Joseph L. Hardesty.

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Ky. Legislative update (KY)

By State Rep. Chris Harris
JANUARY 9, 2017

I fought hard during this first week of the 2017 session of the Kentucky General Assembly to protect the interests of Kentucky’s working families against a rising tide of wealthy corporate interests, but in the end, our best efforts were blocked by the new ruling majority in the Kentucky House of Representatives. This week will go down in Kentucky history as one of the most damaging to working people.

Never before in modern times has a legislative session been used to do so much harm in so little time with so few opportunities for public input or debate. No time was wasted by Republican majorities in the House and the Senate to repeal prevailing wage standards in the construction of public projects and to enact what I call “right to work for less” legislation. These measures – affecting thousands of working families in Kentucky, both union and non-union – passed despite our strong objections and repeated attempts to slow the process long enough to let the voices of the people be heard during the legislative process.

Numerous studies and overwhelming data show workers’ wages go down when so-called “right to work” legislation, is passed. There’s a long list of other ills associated with right to work states – less health insurance coverage, poor workplace safety records, and less per capita spending on education, to name a few.

Repealing prevailing wage standards also lowers wages for building and tradesmen, like electricians, pipe fitters, plumbers, and steamfitters employed in public construction projects. These repeals also negatively affect the quality of construction and encourage out-of-state, fly-by-night contractors with employees of questionable training, skills and citizenship.

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Union members say lawmakers launching ‘attack on the working people’ (KY)

JANUARY 7, 2017 10:19 AM

FRANKFORT – Angry labor union members on Saturday said they don’t know how they became public enemy No. 1 in Kentucky’s 2017 legislative session.

Hundreds of workers in boots and heavy coats poured onto every public floor of the state Capitol to loudly protest final passage of three bills that they say will weaken unions and reduce construction workers’ wages.

“It’s an attack on the working people,” said Chris Kendall, 44, a member of Local 184 of the Plumbers and Steamfitters Union in Paducah.

“It’s almost like we’re the enemy somehow, that it’s the politicians against us,” Kendall said. “And all we’re trying to do is earn an honest day’s wage.”

Said Bruce Rowe, a Pike County truck driver who belongs to Local 14581 of United Steelworkers, “This will just be awful for our communities. Once you cut our pay, your tax base goes down, and we’ve got less money to spend at Wal-Mart and buying cars and getting groceries for our families and shoes for our kids.”

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Productivity slides without prevailing wage laws Larry L. Roberts

DECEMBER 30, 2016 12:36 PM

Recently, Kentucky Chamber of Commerce President and CEO Dave Adkisson penned a column with his Christmas wish list of low-road pro-business issues he expects the GOP to address in the 2017 General Assembly.

While I am not surprised by Adkisson’s support for repeal of Kentucky’s prevailing-wage law, I am surprised he relied upon a flawed draft report to substantiate repeal of something as important to the economy as prevailing wage.

The report he referenced was not adopted by the Kentucky legislature’s Program Review and Investigations Committee at its Dec. 16, 2014 meeting for a variety of reasons. The report was not an accounting of construction costs; it was a back-of-the-envelope hypothetical calculation about wages – and wages only.

There was no consideration of whether or not projects were completed on time. There was no consideration of cost overruns. There was no consideration of productivity of low-wage contractors and there was no consideration of downstream maintenance cost.

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Prevailing Wage Repeal Would Hurt Kentucky’s Economy

Repealing Kentucky’s prevailing wage law would weaken the state’s economy, according to a new study.

Eliminating prevailing wage would cause a pay cut for middle-class workers, qualify more workers for public assistance, slash apprenticeship training, and result in more of Kentucky’s tax dollars going to out-of-state or foreign contractors. Veterans, who populate construction trades at a higher rate than non-veterans, would be particularly impacted if Kentucky were to repeal its prevailing wage standards.

DECEMBER 16, 2016

The report was authored by economics professor Kevin Duncan, PhD and Frank Manzo IV, MPP- Policy Director of the Midwest Economic Policy Institute, a division of the Illinois Economic Policy Institute.

Full Report: The Economic, Fiscal, and Social Effects of Kentucky’s Prevailing Wage Law.

Fact Sheet #1: One-page summary of the report.

Fact Sheet #2: One-page summary – version 2.

The preponderance of peer-reviewed economic research finds that prevailing wage laws do not increase construction costs, including three-fourths of all studies over the past two decades. This finding directly disputes the claims of those who advocate for repealing Kentucky’s 76-year-old prevailing wage law. Unfortunately, some prevailing wage opponents are either really bad at math, or they expect the people of Kentucky to work for poverty-level wages.

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Prevailing wage repeal a con job | Frank Manzo IV

Frank Manzo IV, Guest Contributor
7:46 a.m. EST December 19, 2016

The dictionary defines a “con job” as an act of “swindling or duping” to get one’s way.

Kentucky voted overwhelmingly to elect Donald Trump President, along with historic GOP majorities in both houses of the Legislature. To win, Trump and Kentucky Republicans campaigned on a lot of promises–including to “create jobs,” and “lift the wages” of working people.

Early next month, the Kentucky Legislature is expected to do just the opposite, by repealing the state’s prevailing wage law.

Prevailing Wage is the minimum wage for skilled construction work on state-funded projects. There are over 82,000 Kentuckians working in occupations affected by its state prevailing wage-carpentry, plumbing, electrical, pavers, roofers, painters and more. A repeal of prevailing wage would be a state-mandated pay cut for these workers.

Recent research by the Midwest Economic Policy Institute and renown Economist Dr. Kevin Duncan shows that prevailing wage repeal will cost 1800 of these workers their jobs, drive almost 6,000 into poverty and onto public assistance, cost another 6,000 their employer-sponsored health insurance, and will eliminate pension plans for another 10,000 workers. And because lower wages translates to lower spending by workers in their communities, prevailing wage repeal will cost Kentucky another 1100 jobs across other economic sectors.

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Weakening Prevailing Wage Hurts Local Contractors (IN)

A case study from Southern Indiana demonstrates how weakening prevailing wage negatively impacts local contractors and local workers.

Published by Frank Manzo IV
JUNE 15, 2016

Out-of-state contractors benefited after Indiana weakened its prevailing wage law, according to a new Economic Commentary from the Midwest Economic Policy Institute.

Despite an emerging academic consensus that shows state prevailing wage laws have no discernible impact on project costs, lawmakers in Indiana weakened the state’s law – called Common Construction Wage – between 2012 and 2015. In 2013, the threshold for coverage was increased from $250,000 to $350,000, meaning that workers were no longer paid a prevailing wage rate on projects costing between $250,000 and $349,999.

Prior to raising its contract threshold to $350,000, hourly earnings for construction workers in Indiana were similar to all neighboring states except Kentucky. Economic research suggests that out-of-state contractors with lower-paid workers will flood the public construction market after a prevailing wage law is weakened. If true, the greatest threat to Indiana contractors would come from across its southern border in Kentucky, where construction workers earned $5 less per hour on average in July 2012.

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Judge blocks Bevin’s executive order abolishing commission

JUNE 8, 2016 5:09 PM
The Associated Press

FRANKFORT, Ky. (AP) – A Kentucky judge has issued a temporary injunction blocking Gov. Matt Bevin’s executive order that abolished the Workers’ Compensation Nominating Commission and recreated a new one.

The Lexington Herald-Leader reports Franklin Circuit Judge Phillip Shepherd issued the order Wednesday and said it will remain in effect until he issues a final ruling.

Bevin’s press secretary, Amanda Stamper, said the governor’s office believes the ruling is wrong and is considering legal options, including possible appeal.

The commission nominates administrative law judges to be appointed by the governor and who decide if and how much employers have to pay workers who were hurt on the job. Last month Bevin abolished that commission, rewrote the law that governed it and then re-created it with new members, all by executive order.

Two labor unions and four injured workers filed a lawsuit challenging the move.

(See Article)

Kentucky House panel defeats prevailing wage exemption bill

By Bruce Schreiner | Updated Feb 4, 2014

FRANKFORT, Ky. (AP) – Cheered on by a roomful of union construction workers, a Kentucky House committee on Thursday defeated a Republican-backed bill to exempt public school projects from the state’s prevailing wage.

The arguments and outcome echoed past years when Senate Republicans made the prevailing-wage exemption a top priority, only to watch it stall in the Democratic-led House.

Republican Sen. Wil Schroder, the bill’s lead sponsor this year, said the issue will certainly resurface next year when the General Assembly’s political dynamics could be changed

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This KY Contractor Has Spent 10 Years Fighting $50,000 in Back Wage Claims. They Finally Lost.

November 5, 2014

A case brought forward by the Kentucky Building Trades was recently upheld in the Kentucky Court of Appeals providing a victory for both the involved unions and their signatory contractors.  The case will mean Teco Mechanical, a non-union contractor from Lexington, will pay $54,164 in back wages to its workers along with a $5,250 penalty (plus eight percent compound interest from December of 2004).  The nearly decade-long case has gone through all levels of the Kentucky legal system and tested both the patience and perseverance of the Kentucky Labor Cabinet.

The incidents themselves date back to 2000 when Teco worked several prevailing wage projects and failed to correctly pay its employees.  The Kentucky Labor Cabinet then performed an investigation, according to the Court of Appeals opinion:

TECO is a mechanical contractor that provided contractor and subcontractor services on a number of public works projects. Pursuant to statute, contracts for these projects required TECO to pay its employees no less than the prevailing wage.1 KRS 337.510(1). In 2001, several TECO employees contacted the Kentucky Labor Cabinet and alleged that TECO had failed to pay them the prevailing wages for the work that they had performed. The employees asserted that TECO had paid them according to a formula under which it classified them as lower paid, general laborers for a fixed number of hours and as higher paid, skilled laborers for a fixed number of hours-regardless of the actual time spent working in each classification.

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