The Building Tradesman Newspaper

Friday, June 29, 2018

Some fight left in the battle to sustain Michigan's prevailing wage

By Marty Mulcahy, Editor

LANSING - "The good news," Michigan Building and Construction Trades Council President Steve Claywell noted dryly in an e-mailed update to affiliates on the aftermath of the repeal of the state's prevailing wage law, "is that the Michigan House and Senate are on summer break."

The fact that the state Legislature can't pass any laws while it is not is session is of scant comfort to a huge swath of the state's construction industry, which witnessed the devastating June 6 repeal of the Michigan Prevailing Wage Act of 1965. In other states where prevailing wage has been repealed, workers' wages have dropped, skilled workers have become more willing to travel to seek better wages, skills and safety training have suffered and productivity drops - all with essentially zero benefit to taxpayers.

On June 6 the state Senate voted to accept legislation initiated a petition drive backed by the Associated Buildings and Contractors-Michigan to repeal prevailing wage, 23-14. It was a closer vote in the state House, 56-53. All Democrats in both Houses voted no on prevailing wage repeal, joined by only a handful of Republicans. The lawmakers could have declined to simply not vote on the issue and let the question go to the general election ballot in November. Instead, not only did they vote to repeal, the majority gave the repeal "immediate effect," which took place after a quick voice vote.

"That immediate effect is one of the areas we're looking at to make a challenge," said Michigan Building and Construction Trades Council Secretary-Treasurer Patrick Devlin. "The state Constitution spells out how immediate effect should take place, and we have some concerns over the way this was done."

Devlin said the legal team for the union-backed Protect Michigan Jobs- the union-contractor group which has battled the petition backed by pro-repeal Protect Michigan Taxpayers - is "looking at all avenues" to further the fight against allowing repeal to take root. Getting a court to agree that "immediate effect" wasn't appropriately implemented through a full vote of the Legislature could delay the implementation of the law until next March. 

Such a delay would save a lot of construction workers a lot of money.  The prominent law firm Clark Hill, suggested to its clients in public school construction that with its reading of immediate effect, "if you have already entered into a contract for construction which required the payment of prevailing wage rates, you will be required to honor that arrangement until completion of the project or termination or expiration of the contract."

However, the legal firm said it's a new ballgame where there are no contracts in place. "If you are in the process of competitively bidding a project which requires the payment of prevailing wage rates to contractors, and bids are not yet due, we recommend preparing an Amendment to the Request For Bids/Proposals to remove the requirement for complying with the Michigan Prevailing Wage Act," Clark Hill said. 

Furthermore, Clark Hill said, "If you have already bid a prevailing wage project and bids have been received, but not yet awarded, we either recommend that you reject all bids and start the competitive bidding process over to remove the requirement for complying with the Michigan Prevailing Wage Act or send out a request to each person/entity that bid on your project, to invite them to submit a clarification to their respective bid/proposal, on or before a specified due date, to allow each bidder to provide a revised contract sum without requiring compliance with the Michigan Prevailing Wage Act."

Said Devlin: "And with that you can see exactly what will happen with prevailing wage repeal. Workers' wages, both union and nonunion, are going to be targeted for reduction by contractors trying to win that work."

Devlin said another option that is still open - there still may be enough time this year, and there certainly would be time next year -  to continue or re-start a counter-petition aimed at re-implementing a new prevailing wage law in the state. Union-backed efforts would have to quickly gather well over 252,000 valid signatures in a 180-day window during the summer months in a petition drive that would put a new prevailing wage law on the state's books.