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Part of health care bill removes bidding edge for nonunion

Date Posted: January 8 2010

Organized labor doesn’t like a lot about the dueling health care bills in the House and Senate, but the National Electrical Contractors Association (NECA), whose contractors hire IBEW electricians, said they support an amendment to the Senate bill that helps level the playing field for union construction employers.

Initially, under a small business exemption in the Senate bill, up to 90 percent of construction industry employers would not have been required to provide health coverage for their employees. That would have provided nonunion contractors a tremendous cost advantage over union employers when it comes time to bid projects.

But an amendment inserted by Sen. Jeff Merkley (D-Oregon) requires construction industry employers with over $250,000 in payroll, or more than five workers, to provide employee health insurance or pay a penalty.

“We commend Sen. Jeff Merkley for standing up to sponsor this amendment,” said Lake Coulson, NECA executive director, government affairs. “Construction employers who fail to provide health care for their workers should not gain a competitive advantage.”

A majority of NECA contractors are currently classified as small businesses, and they already provide health insurance for their employees. The exemption would have written into law a competitive advantage for construction employers who don’t provide health insurance for their workers.

“I believe that all construction employers should accept providing health insurance for their workers as a basic responsibility,” said Mel Buttrum, owner of Service Electric Co., Snohomish, Wa. “It is possible to run a profitable business while paying living wages and providing generous employee benefits. NECA members do it every day. I’m proud to be a member of an organization that recognizes the value of protecting our workers.”

The Merkley amendment limits the exemption. The amendment was co-sponsored by Sen. Chuck Schumer (D-NY) and Sen. Al Franken (D-Minn.) and has wide support throughout the Senate.

Predictably, the anti-union Associated Builders and Contractors hates the amendment. A Wall Street Journal article quoted the ABC’s Geoffrey Burns as saying 95 percent of ABC contractors provide health care insurance. The other five percent, he said, don’t, “because their margins are so thin they can’t afford to do so.”

Added ABC President and CEO Kirk Pickerel: “At a time when our industry is facing the worst construction economy in decades, the last thing contractors need are vast new mandates from the federal government dictating to them how they will run their business.”
NECA has been out front in favor of the amendment, whose fate lies in the upcoming House-Senate conference to come up with a single national health care plan.

“The Merkley amendment is about fairness,” said NECA CEO John M. Grau. ”Without the Merkley amendment, too many construction employers would be exempt from providing health coverage for employees. NECA strongly supports the Merkley amendment, and we will continue to speak out on issues that will affect both contractors and employees.”