Assessing prevailing wage benefits to workers, contractors, and the NYC economy

Posted by National Alliance for Fair Contracting on

The Worker Institute of the ILR School at Cornell University
August 3, 2023

The Labor and Employment Law Program, the Buffalo Co-Lab and the Worker Institute of the ILR School at Cornell University are hosting the launch of a report exploring the cost of prevailing wage to New York City workers and contractors.

On January 1, 2022 an expansion of the prevailing wage law in New York City came into force. The new law significantly increases the universe of construction projects subject to prevailing wage requirements. Given the recent change in legislation, researchers at the Buffalo Co-Lab and the Worker Institute will present on research that explored the cost savings of workers covered by prevailing wages versus workers who are not, in four areas of construction work: laborer, carpenter, lather, and cement finisher. On the face of it, there does not appear to be a difference between union and nonunion wages and benefits in a project covered by prevailing wage. But this changes when the percent of the cost of benefits for a union worker is compared to a nonunion worker. This is, in fact, a defining factor and here the analysis will help us better understand the nature of this relationship between cost of wages and benefits for union versus nonunion workers. Researchers will also present a newly created tool that the public can use to determine the cost of a union versus nonunion contractor for future projects.

A panel discussion will follow the presentation of research with distinguished members of government, labor unions and the real estate industry to explore together the role prevailing wage projects play in and how the building industry can better work to protect the health and safety of construction workers while building more cost-efficient projects in New York City. This session will explore the future of prevailing wage projects, the need for enforcement and responsible contractors as stewards in New York City.

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Local Impact of Prevailing Wage (MN)

Posted by National Alliance for Fair Contracting on

September 06, 2018 10:41 PM
(ABC 6 News)

When a construction worker goes to work on a project with a private contractor, the contractor decides what workers will be paid. However, when they work on a government-funded project, workers must be paid “prevailing wages.”

President of South Eastern Minnesota Building and Construction Trades Council Nate O’Reilly says for every construction project funded by the state, workers must be paid a minimum base rate called “prevailing wage.”

“When public dollars are being spent…it creates that level playing field to ensure the public expenditures reflect the local area standards for wages and benefits,” said Nate.

In the private construction industry, the lowest bidding contractor almost always gets the construction job. Executive Director of the Fair Contracting Foundation Mike Wilde says prevailing wage is intended to protect local workers and ensure they get paid fairly. This prevents the job from going automatically to whoever can do it the cheapest, which Mike says is often workers from out of the area.

…

“You want people that live in the area, perhaps reside in the housing, and support the economy. You want them to be your workforce, as opposed to people who might come in and do unskilled, unsafe, and insufficient work and perhaps take the wages out,” said Mike.

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Somerville community groups demand union labor during Clarendon Hill construction (MA)

Posted by National Alliance for Fair Contracting on

Posted Apr 18, 2018 at 2:13 PM

A coalition of community groups and unions are campaigning to ensure that a for-profit developer pays prevailing wages and uses union labor on a public-private partnership to rebuild the public housing at Clarendon Hills.

The for-profit developer, Redgate, along with non-profit developers Preservation of Affordable Housing (POAH) and Somerville Community Corporation (SCC),are planning to renovate Clarendon Hill Apartments in Somerville and build market rate units to pay for it.

Public-private partnerships like this are part of a trend in to finance the redevelopment of existing public housing. The developers seek to minimize costs by getting a pass on the state’s prevailing wage law.

“We agree that the residents of Clarendon Hill should reside in the best housing possible, and that high quality affordable housing in Somerville should be accessible to all,” said Jaril Gauthier, a sheetmetal worker and Somerville resident. “However, we are opposed to the notion of betraying one important mission for another, especially when a private interest stands to make tens of millions of dollars off this so-called public-private “partnership.”

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High court puts prevailing wage repeal vote on hold (MI)

Posted by National Alliance for Fair Contracting on

Jonathan Oosting, Detroit News Lansing Bureau
Published 1:40 p.m. ET May 15, 2018

Lansing – A push to repeal Michigan’s prevailing wage law for construction workers hit a snag on Tuesday.

The Michigan Supreme Court suspended a lower-court order requiring the Board of State Canvassers to certify petition signatures as the seven justices decide whether to hear an appeal.

The high court did not rule on the merits of the case and could still reject an appeal by a coalition of unions and union-friendly contractors.

But the Tuesday afternoon “stay” prompted cancellation of a canvassers meeting and delays likely action in Michigan’s Republican-led Legislature, which is expected to take up the prevailing wage repeal measure if it reaches lawmakers. Approval would bypass a threatened veto by GOP Gov. Rick Snyder.

The 1965 law guarantees union-level pay and benefits for construction workers on projects funded by the state government. Repeal proponents argue prevailing wage inflates construction costs ultimately borne by taxpayers, while opponents maintain repeal would lower wages and limit training programs they fund.

The Michigan Court of Appeals last week ordered the Board of State Canvassers to certify the prevailing wage repeal petition after the panel deadlocked in late April in a 2-2 vote.

The Michigan Bureau of Elections had recommended certification of the prevailing wage ban ballot proposal, but both Democrats on the bipartisan panel voted against the prevailing wage repeal measure amid arguments over false addresses provided by circulators who had collected signatures.

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Repealing prevailing wage would be irresponsible (MI)

Posted by National Alliance for Fair Contracting on

2018-05-03 / Viewpoint

There’s been plenty of buzz lately around the need for Michigan to update its infrastructure. But when the state sends workers into our communities to fill our potholes, construct our bridges or renovate our schools, we expect the job will be done well. We don’t expect it to take years for them to repave a few blocks of our neighborhood, or that the cherry picker helping assemble an overpass will become part of the community’s scenery as the project lasts indefinitely.

We expect the job will be done on time and will be high quality, and that’s all thanks to Michigan’s prevailing wage laws.

Prevailing wage has gotten a bad reputation lately, but at the end of the day, all it means is that workers are getting paid the local average for construction projects in the area, guaranteeing the workers earn an honest day’s pay for an honest day’s work. That is just common sense.

Critics claim it’s too costly to pay state construction and skilled trades workers a fair wage, and if we repeal our prevailing wage laws, the state will save money and our economy will get on the right path.

But as simple as that sounds, studies show it simply isn’t true.

A study published earlier this year analyzed the effects of repealing prevailing wage on Indiana’s economy in the three years since it’s been eliminated. Rather than enjoying prosperous economic benefits as promised, the state has since suffered with higher worker turnover and lower productivity.

Tim Sneller, State Representative
Burton

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Prevailing wage protects Michigan families, workers (MI)

Posted by National Alliance for Fair Contracting on

By Stephanie Chang
Dec 17, 2017

The main thing Michiganders need to remember about the prevailing wage repeal proposal is this: Do not be fooled.

This year, special interests collected signatures to put the question of repealing Michigan’s long-standing prevailing wage law before the Legislature or on the ballot – often misconstruing the true intent of what their petition would do.

I oppose this proposal, and one need only visit my Detroit and Downriver district to understand why.

Michigan’s prevailing wage law ensures that our publicly financed buildings, roads, bridges and utilities are constructed using highly skilled and trained workers who are paid the regional average for their trade. The law doesn’t artificially inflate wages or the cost of construction and doesn’t force workers to be union members.

It just ensures that the people building our infrastructure earn a fair wage and benefits, and that their pay reflects their level of training. The law keeps skilled tradespeople and their families here in Michigan, where they participate in the economy and pay taxes.

Michigan created the middle class, and I am seriously concerned when the middle class is threatened by the potential slashing of wages and benefits for our hardworking friends, neighbors and family members.

Mistakes happen when inexperienced, lesser-trained workers do the work.

For example, there is courthouse in a community outside of Detroit that took 21 months to complete – far longer than the six months anticipated. From the noisy HVAC system that prevented judges from being able to hear proceedings to the counter windows missing holes for clerks to speak through, the shoddy work increased project costs tremendously.

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