Michigan Legislature Repeals Prevailing Wage

 

In a blow to Michigan’s working families, the Republican-led Legislature voted to repeal the state's prevailing wage on June 6.

On June 6, the Michigan state Legislature repealed the prevailing wage, a law that promises union-level pay on public construction projects.  Photo credit: Ken Lund via Flickr

“It’s incredibly disappointing to see the legislature move forward with an attack on Michigan workers that will cut wages and harm communities across the state,” said Steve Claywell, Michigan Building and Construction Trades Council president and member of Battle Creek, Mich., Local 445. “We are already facing a shortage of skilled labor, and thanks to this misguided vote, Michigan is now lacking an essential tool to ensure quality wages that attract top talent.”

The prevailing wage requires union-scale wages on public construction projects, which discourages unscrupulous contractors from undercutting their competition and hiring out-of-state, low-skilled workers who can be paid less and easily exploited.

The issue came before the Legislature by way of a little-used public petition provision in Michigan law. The law allows a citizen-initiated petition that gathers enough valid signatures to go first to the Legislature for a 40-day review period, where the issue may be voted on. If it doesn’t get a vote, it then goes on the November ballot for voters to decide. If it is voted on, the governor cannot veto it.

Michigan’s current governor, Republican Rick Snyder, supports the prevailing wage and had long-threatened to veto the measure if it came through the regular legislative process.

The initiative comes from Protecting Michigan Taxpayers, a group funded in large part by the anti-union Michigan chapter of the Associated Builders and Contractors, which submitted 380,000 signatures in November. The state ABC contributed almost $2 million of the $3 million raised for the petition drive, according to the Detroit News.

During the validation process at the State Board of Canvassers, a number of the signatures were called into question, and the State Board of Canvassers initially didn’t approve it. After a battle that went all the way to the state Supreme Court however, the initiative eventually landed before the state Legislature, where Republican leadership moved quickly to approve it.

The Legislature had already introduced three different bills to repeal the prevailing wage, but those would have been subject to a veto from Gov. Snyder. This time, with no role for the governor to play, the Republicans used their majority to vote for repeal – and to give the measure immediate effect, meaning the repeal will become law in the next few days, reported the Detroit Free Press.

“The Legislature took power away from the people to decide on this important issue, and they now will need to answer to Michigan voters,” Claywell said. “It will be up to the voters to decide on whether they support their lawmakers cutting wages for hard-working men and women in this state.”

Michigan’s primary is Aug. 7 and Sixth District International Representative Joe Davis, who is also the IBEW’s state political coordinator, says this vote will be part of their education drive and get out the vote efforts.

“It’s been death by a thousand cuts in Michigan,” Davis said. “This is the latest in a long line of eroding working people’s rights, and we’re making sure our members know the score when they vote.”

According to a survey conducted in 2015, almost 60 percent of likely voters support the prevailing wage, with only 25 percent opposed, reported the Detroit News.Part of the reason for the broad support could be because of Michigan’s previous partial repeal, which failed.

In 1994, the Great Lake State repealed the prevailing wage on school projects, but the presumed benefits never materialized. Schools didn’t save money, worker abuse increased and corrupt contractors got richer. Three years later, the law was reinstated.

According to an Economic Policy Institute report released last year, 20 states have scrapped prevailing wage laws and several more have weakened them. In states without the law, median wages are almost 22 percent lower than those with a prevailing wage.  

A recent study out of Indiana by the Midwest Policy Institute, released in January, found that the skilled workers’ wages dropped by an average of 8.3 percent since the state repealed the prevailing wage in 2015. Neighboring states, by contrast, saw wages grow an average of 2.8 percent over the same time period.