Infrastructure, Jobs And Economic Growth

on August 21, 2017 at 10:00 AM

We’ve posted quite a bit recently about the need for streamlining the federal permitting process for energy infrastructure (see here and here). An API study earlier this year estimated investments in needed natural gas and oil infrastructure could total more than a trillion dollars and potentially generate more than 1 million jobs through 2035. That’s a lot of economic potential linked to infrastructure – and in that context, President Trump’s new executive order modernizing and bringing greater accountability to the federal permitting process certainly is welcome.

It coincides with release of a new study, for North America’s Building Trades Unions (NABTU), detailing the jobs and economic impacts of energy infrastructure construction. NABTU President Sean McGarvey and API President and CEO Jack Gerard talked about the study and America’s energy infrastructure needs during a conference call with reporters.

The pipeline employment study estimated that $6 billion to $28 billion was spent annually o n new additions to and the reconstruction of existing pipelines from 2006 to 2016:


The study:

Industrial construction is an important source of jobs for the skilled construction trades. Individuals who engage in industrial construction have certifications, licensing, and training that provide guarantees that they are competent in difficult, specialized work. Pipeline workers are an important segment of this group. Pipelines are important to the efficient operation of the U.S. economy, and pipeline construction is an important source of family supporting jobs for construction workers.

McGarvey said the study’s findings are noteworthy they show support for the economy during a period that included a recession. Pipeline construction jobs bolster America’s middle class, he said. McGarvey:

“We’re talking about average weekly earnings of almost $1,200 a week, to keep folks squarely in the middle class. We look forward, based on this study, to show the real impact of this industry on maintaining that floor.”

(Read More)

Raise wages, boost economy: Letters (CA)

By Letters to the Editor
September 6, 2017 at 12:01 am

Re: “State’s not-so-affordable housing plans” [Opinion, Aug. 31]: Your editorial advocates cutting the pay of construction workers to pad the profits of housing developers. Finally, we have an honest summation of the argument of the housing industry against the prevailing wage: profits before people.

The editorial, however, lacked credibility as well as heart. In outlandish fashion, it cited the recent bought-and-paid-for study funded by the California Homebuilding Foundation to say that the prevailing wage would result in a 37 percent increase in housing costs. The organization, of course, is made up of some of the biggest contractors and real estate developers in the state. And just as your editorial acknowledged, when it comes to maximizing profits, they’d rather pay their poverty wage than a prevailing wage.

In that process, distorting the truth and the facts is no big deal, and the predicted 37 percent housing cost increase that you quoted in your editorial has no basis in reality. In fact, it is up to six times higher than some numbers that the study’s same authors put out in some of their own previous reports.

More credible research puts the added cost of construction related to the prevailing wage at around 3 percent. The increase is then easily made up by savings associated with the skilled-and-trained prevailing wage work forc

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Massachusetts contractor to pay $100,000 for alleged wage law violations (MA)

by Mark Iandolo |
Aug. 16, 2017, 8:47am

BOSTON (Legal Newsline) – Massachusetts Attorney General Maura Healey announced Aug. 8 that Wilmington Wiring Corporation (WWC) and owner John Garrett will pay more than $100,000 after allegations of intentionally failing to properly pay employees working on a public project for the city of Worcester to repair streetlights.
Healey’s office cited the defendants with failure to pay the prevailing wage, failure to furnish payroll records, and failure to furnish certified payroll records to the Attorney General’s Office.

According to Healy, the defendants failed to pay six employees the right wages on the public works project. Massachusetts has a prevailing wage law mandating that contractors and subcontractors working on public construction projects need to pay employees a special minimum wage based on occupational classification.

“Prevailing wage laws ensure workers are paid a real, living wage and level the playing field for companies that play by the rules,” Healey said. “Workers, honest employers and taxpayers lose when companies fail to follow wage and hour laws.”

Assistant attorney general Erik Bennett and investigator Tom Lam, both of Healey’s Fair Labor Division, handled the case for Massachusetts.

(See Article)

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

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.


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.


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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Washington Company Cited for Shorting Construction Workers on Project (WA)

“Integrity vastly underpaid its employees for the work they did,” said Elizabeth Smith, assistant director for L&I’s Fraud Prevention and Labor Standards division. “It’s important that agencies and non-profits understand that using public money on a project means it’s covered under prevailing wage.”

Aug 28, 2017
Occupational Health & Safety

A Washington State Department of Labor & Industries found that six construction workers employed by Integrity Construction LLC were shorted more than $155,000 in wages for work on a Belfair senior center and are owed about $25,000 each for wood framing at the site, the Belfair Hospitality, Unity, and Belonging (HUB) Senior Center. Their employer, Integrity Construction LLC, was on the project from May to August 2015. L&I recently notified the company of the violation.

“Integrity vastly underpaid its employees for the work they did,” said Elizabeth Smith, assistant director for L&I’s Fraud Prevention and Labor Standards division. “By making sure contractors pay their workers fairly, we are creating a level playing field for firms in the construction industry.”

The investigation found the Tacoma company owes $156,692.48 in wages and more than $30,000 in fines and penalties. Integrity did not appeal the violation and is barred from bidding on future public works projects until that money is paid. The Belfair project received $1.86 million from the state’s capital budget, which meant Integrity was required to follow the state’s prevailing wage law. L&I enforces the law.

(Read More)

Wilmington-Based Electrical Company Cited $100K+ (DE)

The AG’s Office zeroed in on the company, which dissolved in 2016.


By Mike Carraggi (Patch National Staff)
Updated August 9, 2017 12:31 am ET

WILMINGTON, MA – A Wilmington-based electrical company was cited more than $100,000 in restitution and penalties for not properly paying employees working to repair streetlights in Worcester, Attorney General Maura Healey announced today. …

Wilmington Wiring Corporation and owner John Garrett had three civil citations issued against it for failure to pay the prevailing wage, failure to furnish payroll records, and failure to furnish certified payroll records to the AG’s Office.

“Prevailing wage laws ensure workers are paid a real, living wage, and level the playing field for companies that play by the rules,” said Healey. “Workers, honest employers, and taxpayers lose when companies fail to follow wage and hour laws.”

WWC was based in Wilmington until it dissolved in May 2016. The AG’s Office began investigating the company in January of that year after an employee filed a complaint alleging he was not paid the prevailing wage rate for five years of work on a public project repairing streetlights in Worcester, the AG’s Office said. An investigation revealed six employees were not paid proper prevailing wage for the public works project; only WWC union employees were. WWC also then ignored the AG’s Fair Labor Divison’s payroll demands, the AG’s Office said.

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Are Georgia firms cheating 1,000s of workers out of benefits, health care? (GA)

By Jon Greenberg on Thursday, August 10th, 2017 at 2:51 p.m.

With health care policy in limbo in Washington, the politicians who would like to be Georgia’s next governor are staking out their own policy outlines. Democratic State Rep. Stacey Evans favors expanding Medicaid, but said the state could take other action as well.

“There are thousands of Georgia workers that are misclassified as independent contractors, so that their employers can wrongfully deny them the benefits that they deserve, including health care,” Evans said Aug. 5. “By expanding Medicaid and classifying workers appropriately, insurance will be available to hundreds of thousands more Georgians.”

We decided to check Evans’ number of misclassified workers, and found she’s on safe ground.

Defining misclassification

Some businesses avoid treating workers as employees by calling them an independent contractor. The person might work only for that one business, use equipment the business provides and do exactly what the business tells him or her to do, and yet be labeled as if the person was in business for themselves.

The advantage for companies is they avoid paying a number of employment taxes, including Medicare, Social Security and unemployment insurance. If they offer health insurance, they would sidestep that too.

As Georgia’s Department of Labor put it, “independent contractors are not independent just because that is what their employer calls them, because that is what they call themselves, or because they sign an ‘independent contractor agreement.’ Independent contractor status depends on the underlying nature of the work relationship.”

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Labor leader: Prevailing wage protects workers from ‘race to bottom’

By Matt Glynn , and Jonathan D. Epstein
Published June 30, 2017 | Updated June 30, 2017

New York State has had a prevailing wage law since 1894, and supporters say it’s needed to protect workers from being undercut and underpaid by contractors and government agencies. They also argue that prevailing wage laws help ensure that the size of public contracts – and the potential for a bidding race to the bottom to win them – don’t destabilize local and regional construction markets.

But critics say the laws hurt free-market competition, drive up costs on public projects and provide little real 30benefit to the economy other than protecting labor unions.

Conservative researcher E.J. McMahon and union advocate Richard Lipsitz Jr. recently sat down with The News to talk about the controversy over the state’s prevailing wage requirements.

Richard Lipsitz Jr. sees the prevailing wage law as protection against the “race to the bottom.”

The president of the Western New York Area Labor Federation, AFL-CIO, an umbrella organization covering 100,000 union members in six counties, Lipsitz has been active in the labor movement since the 1970s, and the federation he leads has been outspoken in the drive to raise the state’s minimum wage.

Q: How does the state’s prevailing wage benefit construction workers?

A: It is a wedge against the race to the bottom in the construction field. Without provisions like prevailing wage, there would be no guarantee that a contractor wouldn’t go down and pay the minimum that he has to or she has to. It’s a rule that keeps this race from the bottom from being carried out in the construction field.

And it also helps with the workers in all other fields. The idea of a prevailing wage, as a good wage and benefits package that people can live on, is mostly talked about in the construction field. But the Commerce Department keeps a prevailing wage on all kinds of occupations in New York State, not just for building trades. So I don’t think it’s quite right to just see it as a construction trades question.

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McHenry County Board approves prevailing wage, ending three years of protest votes

June 26, 2017

WOODSTOCK – The McHenry County Board approved the state prevailing wage rates, ending a three-year streak of casting a symbolic protest vote against them.

Board members voted, 19-3, to adopt the wage schedule, which requires local governments to pay workers hired for public construction projects a specific wage set by the Illinois Department of Labor.

Audience members, many of whom were union members and local residents who came to encourage a vote to approve, applauded when the final vote was tallied.

The County Board since 2014 had voted against prevailing wage, while being careful to instruct county staff to follow the law.

Board member Donna Kurtz, R-Crystal Lake, said voting against prevailing wage sends a negative message to the community, and disputed the notion that the wages are responsible for the county’s sky-high property taxes.

“I think in the end, the overall benefits well outweigh the negatives that some may perceive regarding prevailing wage. It’s the right thing to do – we know it’s the law. It’s the right thing to do,” Kurtz said.

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May 8 2017

OLYMPIA – The governor today signed into law Attorney General Bob Ferguson’s bipartisan legislation prohibiting businesses that have willfully violated state wage theft laws from being awarded government contracts.

Senate Bill 5301 bars companies from receiving both state and local contracts if a judge determines they willfully violated state wage theft laws. The measure, sponsored by Sen. Mark Miloscia, R-Auburn, passed the Senate overwhelmingly in February by 46-3 vote. It passed the House by a 63-33 margin in April. The companion measure, House Bill 1936, was sponsored by Rep. Zack Hudgins, D-Tukwila.

“We need to send a message that the state will not do business with those who cheat hard-working Washingtonians,” Ferguson said. “Government contracts – and taxpayer dollars – should only go to companies that play by the rules.”

The Washington state government spends more than $1 billion annually to buy goods and services – and the state spends billions more on public works contracts – but currently, companies that receive contracts from state and local governments are not always required to demonstrate compliance with wage laws.

“The state should not be supporting businesses that are taking hard-earned dollars from the state’s workers,” said Sen. Miloscia, chair of the Senate State Government Committee. “This change will affirm the state’s commitment to protecting workers and reward businesses who respect the law and take care of their employees.”

“We must stand up in Olympia and say, ‘You will not profit from cheating workers,’ ” Rep. Hudgins said. “This simple change will provide an important incentive for companies to follow the law.”

(Read More)