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

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)

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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The Effect of Prevailing Wage Repeals on Construction Income and Benefits

Feb. 2018

Journal of Public Works Management and Policy

Ari Fenn, Zhi Li, Gabriel Pleites, Chimedlkham Zorigtbaatar and Peter Philips – University of Utah

While considerable research has examined the effects of prevailing wage law repeals on construction wages, little has been done on the repeals effect on benefits. Based on state-level data from the quinquennial Economic Census for construction from 1972 to 2012, we find that depending on sample and model specification, statewide annual average construction blue-collar income fell by 1.9% to 4.2%. Statewide annual average legally required benefits (social security, workers injury-compensation insurance, and unemployment insurance contributions) for blue- and white-collar construction employees combined fell from 3.8% to 10.1%. Statewide annual average voluntary benefits (primarily health insurance, pension contributions, and apprenticeship training) for blue- and white-collar construction employees combined fell from 11.2% to 16.0%. Because prevailing wage laws govern only blue-collar construction remuneration, blue-collar benefits probably fell more than blue- and white-collar benefits taken together.

(Download Full PDF Here)

Fair Wage? What repeal of the prevailing wage could mean for the construction trades (WI)

TABLE OF EXPERTS
Aug 29, 2017

The Wisconsin Legislature is considering a full repeal of the prevailing wage statute, which sets construction wages for public projects. Proponents say it will save taxpayers money, but will it? And what are the potential negative impacts of a repeal? The Milwaukee Business Journal recently assembled a panel of experts representing the building trades to explore the issue.

STEVE BROAS (MODERATOR): THERE HAS BEEN A LOT OF DISCUSSION ABOUT THE PREVAILING WAGE. WHAT EXACTLY IS IT, AND WHY WAS IT STARTED?

DAN BUKIEWICZ: That’s a great way to start this conversation, because you really have to go back to the beginning to understand what prevailing wage is all about. It started during the Great Depression. Communities were seeing a lot of transient workers coming into their communities to do work, and they wanted to protect their own local economy and workers. So, prevailing wage was started first and foremost to protect local workers. It established a rate at what it cost to do business and live in that area.

DALE POWELEIT: It started in New York originally. An Alabama company came up and starting undercutting local contractors on construction projects. The people in the community said that was not fair to the area workers, and they decided to go to the federal government, which passed the Davis Bacon Act in 1931. Wisconsin passed its law three or four years after that and other states followed suit.

JEFF MEHRHOFF: The Wisconsin legislation was modeled after the Davis Bacon Act and sets standard local wages. It is not a statewide standard. It is based on the average of construction wages in that area. Milwaukee’s standard wage is different than Madison and different than Appleton.

MODERATOR: HOW DOES IT IMPACT PUBLIC AND PRIVATE PROJECTS?

BUKIEWICZ: Usually, prevailing wage applies only if tax dollars are attached. In Wisconsin, it includes state projects and projects for the University of Wisconsin system. It does not apply to private projects, but there are responsible contractors who pay prevailing wages on private projects, because they want to do the right thing. But that is strictly their call.

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Prevailing wage repeal fails, contractors pleased

May 14th, 2017
by Philip Joens

Contractors around Jefferson City felt relieved Friday night after the General Assembly failed to approve a bill that would’ve repealed Missouri’s prevailing wage law.

Currently, construction workers are paid a state-set minimum wage on state and local construction projects in Missouri because of a state law created in 1959. House Bill 1o4 proposed to repeal that law. It was passed the House in March and had the support of Gov. Eric Greitens before it stalled in the Senate. While local contractors feel relieved, they also know the bill may come up again in next year’s session.

“We have been very concerned about losing prevailing wage,” said Greg Schrock, a local electrician and president of the Jefferson City union International Brotherhood of Electrical Workers 257. “It could make or break us.”

Meyer Electric Vice President Craig Linhardt said he hopes this will give assembly members time to reflect on the issue.

“Hopefully this will give the legislature and the people of the State of Missouri time to reflect on the long term ramifications of how this law affects the working families of Missouri,” Linhardt said.

Each year, all contractors, both union and non-union, turn in the hours they work to the Missouri Department of Labor and Industrial Relations. Wages differ by skill set and county. Because local unions collectively bargain wages in each county, all union contractors are lumped into the same pool.

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