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Prevailing wage 'reinvigorated' with renewed state efforts

Date Posted: December 23 2005

This, the second in a series of articles about the fair enforcement of Michigan's Prevailing Wage law, discusses some of the coverage issues that have changed.

By David Plawecki, 
Deputy Director
Michigan Department of Labor & Economic Growth

Since taking office in 2003, one of Gov. Jennifer Granholm's objectives has been to improve the health, safety and welfare of Michigan workers. To this end, the Michigan Department of Labor & Economic Growth has sought to strengthen enforcement of the state's Prevailing Wage law and to protect our skilled construction trades workers and responsible contractors.

Under the previous administration, Michigan's Prevailing Wage law seemed to discourage complaints and encourage potential abuses. Today, the Prevailing Wage law is being reinvigorated, and Michigan's Wage & Hour Division is working with contractors and workers to ensure fair and equitable enforcement of the act.

90-Day escape rule. Prior to the letting out of bid requests for a contract for a state-backed construction project, the Wage & Hour Division establishes the prevailing wage rate for each classification of construction mechanics requested by a contracting agent. If the contract is not awarded or construction does not start within 90 days from the date the rates are issued, the contracting agent must request a re-determination of rates. Prevailing wage rates remain in effect for the length of the construction project.

In the past, the Wage & Hour Division did not assert jurisdiction when prevailing wage rates for a project were more than 90-days old and the contract was either not awarded or construction had not started. Consequently, a contractor could inadvertently or intentionally delay a project's start date beyond 90 days of a rate request and, thereby, escape any enforcement by the division.

The Wage & Hour Division has now changed the policy, giving the division jurisdiction when rates are issued for the project.

Jurisdictional improvements. In the past, the Wage & Hour Division did not have jurisdiction at a construction site, if the letter requesting bids did not specifically refer to the project as a prevailing wage project. Now, however, the Division will take jurisdiction if there is significant evidence that a project is a prevailing wage project. Such evidence could include enclosing prevailing wage rates in bid specifications.

Community colleges now clearly covered. The prevailing wage coverage policy for schools and institutions of higher education now specifically includes community colleges. In the past, K-12 schools and institutions of higher education were identified as being covered by the state's Prevailing Wage law. The law, however, was silent about coverage for community colleges, which was then interpreted to mean they were not covered.

MDOT improvements. The Wage & Hour Division has worked closely with the Michigan Department of Transportation to ensure that prevailing wage rates are paid on road construction projects, to improve contract language for these projects, and to strengthen the bidding process.

Debarment policy. The Wage & Hour Division implemented the policy to debar employers for violating the state's Prevailing Wage law. Contractors who are found to be in violation of the law could be debarred for up to eight years from being awarded any contract for goods and services with the state of Michigan.

The Division has also computerized the tracking of prevailing wage violations to help determine if and when potential debarment actions should be initiated.

Filing complaints. If you believe you have a complaint about a prevailing wage issue, please contact the Wage & Hour Division. You can contact the main office in Lansing at (517) 322.1825 from 8 a.m. to 5 p.m. on weekdays. The Division also has an office in the Detroit metropolitan area at (313) 456-4906.

Staff is available weekdays from 8:30 a.m. to 3 p.m. Those in the Upper Peninsula can contact our UP-based investigator at (906) 482-3602 between 8 a.m. and 5:00 p.m. on weekdays. Messages can be left for the investigator at any time.

For more information about Michigan's Prevailing Wage law and the Wage & Hour Division, please visit the division's website at www.michigan.gov/wagehour.