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State vows renewed vigor for Michigan's prevailing wage law

Date Posted: May 11 2007

LANSING - The benign neglect of the Michigan Prevailing Wage Act of 1965 is a thing of the past - at least for now.

Keith Cooley, director of the state Department of Labor and Economic Growth, told delegates to the Michigan Building and Construction Trades Council's 48th Legislative Conference last month that the state officials are "reinvigorating the role of the state's prevailing wage law" to ensure construction workers are being paid fairly.

As we have pointed out in the past, the state's prevailing wage act, as well as the federal Davis-Bacon Act - are hands-down the most important laws on the books when it comes to supporting construction worker wages. The state and federal prevailing wage laws prevent unscrupulous contractors from winning bids by underbidding other contractors by paying workers a lower wage.

The laws require contractors to pay their employees a wage that "prevails" in a given geographic area - which makes it difficult for employers to import low-wage, unskilled labor from other regions or even outside the U.S.

But the law is only as effective as its enforcement. Unions charged that the administration of Gov. John Engler more or less ignored enforcement of prevailing wage. Cooley, who began his job in March, said that's not the case under Gov. Jennifer Granholm. He said in the last quarter of 2006, "prevailing wage investigations doubled compared to the year before, and collections (of prevailing wages for workers) were up 40 percent. Progress is being made through more aggressive enforcement."

Cooley said other improvements in prevailing wage enforcement include:

  • Third parties, like union representatives, can now file prevailing wage complaints with the state on behalf of workers, which can remove the intimidation factor.
  • Job sites must now post prevailing rage rate classifications.
  • Previously the state lacked jurisdiction when a project's prevailing wage rates were more than 90 days old. As a result, a contractor could time or "inadvertently" delay the start of a project beyond the 90 days from the date the prevailing wages were requested and thereby escape enforcement from the state. Now, the rule has changed to provide jurisdiction when rates are issued for the project.
  • If a construction project announces a start date with a certain prevailing wage rate, and work doesn't start within 90 days, and the prevailing wage changes during that period, the higher rate applies.
  • Prevailing wage rates are updated continuously, not quarterly or annually. In the past, some wage rates in some geographic areas were more than five years old.
  • Construction work at community colleges, like four-year institutions are now subject to the state's prevailing wage law.
  • The state's attorney general has been asked to prosecute employers who violate the Michigan Prevailing Wage Act.

A list of prevailing wage violators has been posted and is updated on the state's Wage and Hour website. http://www6.dleg.state.mi.us/prev_wage_violations/index.asp

The Michigan Department of Transportation on April 12 showed it is serious about enforcing the state's prevailing wage act, suspending the ability of a Grand Rapids-area contractor from bidding on state highway contracts.

MDOT rescinded the pre-qualification status of Martin J. Concrete Construction Co., effectively preventing the company from bidding on state highway work.