Letter to the Editor: Prevailing wage is good policy (IL)

Posted by National Alliance for Fair Contracting on

DECEMBER 15, 2017
By Frank Manzo IV – Guest columnist

One of the many factors that has made Bruce Rauner one of the nation’s least popular Governors has been his proposals to cut pay for middle-class wage earners. So it came as little surprise to see the Illinois Policy Institute (IPI) – a group with close ties to Rauner – recently attacking the Illinois Prevailing Wage Act.

Prevailing wage functions as a local minimum wage on publicly-funded construction jobs like roads, bridges, schools and police stations. It promotes a level playing field for local contractors, ensures these projects are done right and produces good middle-class jobs for skilled local workers.

Like Rauner, the IPI has recently argued for repealing prevailing wage in Illinois. In so doing, the IPI is passing off flawed analysis with little basis in reality as sound policy.

But don’t take my word for it.

Indiana repealed its prevailing wage law in 2015, and “it hasn’t saved a penny,” according to the state’s Assistant Republican Floor Leader in the House, Ed Soliday. And before repealing its law outright, Indiana took other steps to hollow out its construction labor standards. The effect was not only a decline in wages, but hundreds of middle-class jobs fleeing the state. While IPI claims that repeal would save money and boost employment, the fact is that neither happened in the real-life example of Indiana.

But the experience of Indiana and the observations of Rep. Soliday are hardly outliers. Most peer-reviewed economists have arrived at the same conclusions. I have authored or co-authored 25 studies on these laws myself.

Here’s what we’ve found:

First, labor represents a small and historically declining share of construction budgets and prevailing wage has no effect on total project costs.

Reams of data have shown that eliminating local market-based prevailing wage standards only results in high-skilled local workers getting replaced by lower-skilled workers, often from out-of-town. This ultimately yields not just lower wages- but lower levels of productivity, higher spending on fuel and materials, higher risk of safety problems and shoddy workmanship, and more construction workers reliant on taxpayer-funded government assistance programs.

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The Illinois Policy Institute Receives a Failing Grade on Prevailing Wage (IL)

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Published by Frank Manzo, IV
December 7, 2017

A new report released by the Illinois Policy Institute on prevailing wage is factually inaccurate. Here’s why.

The Illinois Policy Institute is a libertarian policy organization with close financial and lobbying ties to Illinois Governor Bruce Rauner. None of their research has ever been subject to peer review. On December 6, 2017, the Illinois Policy Institute released a report calling for the repeal of the Illinois Prevailing Wage Act- a longstanding goal of Governor Rauner. This brief highlights the biggest problems and factual inaccuracies in their report.

Inaccurate Claim #1: “The empirical literature is still divided on the impact of prevailing wage on construction costs.”

Fact: Most peer-reviewed studies (over 75 percent) have concluded that prevailing wage laws have no impact on total public construction costs.

“We got rid of prevailing wage and so far it hasn’t saved a penny.” -Rep. Ed Soliday, Assistant Republican Floor Leader, Indiana House of Representatives, 2017

Inaccurate Claim #2: Prevailing wage laws “favor disproportionately white, unionized workers.”

Fact: By stabilizing the wage floor, prevailing wage reduces income inequality among construction workers of all backgrounds. Prevailing wage standards cover construction workers of all races- union and non-union alike. Peer-reviewed research has found no relationship between prevailing wage laws and the racial composition of the construction labor force. Over the past 10 years, the union membership rate was higher for African-American workers in Illinois’ construction and extraction occupations than for comparable white workers.

“Davis-Bacon has been instrumental in bridging the wage gap for historically disadvantaged sectors of our society. In the face of decaying social and economic opportunities, this measure provides women and minorities with an important tool to achieving greater parity with their mainstream counterparts.”
-Congressional Black Caucus, 1995.

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State lawmakers should avoid any right-to-work proposal like the plague (OH)

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Brigid Kelly, Opinion contributor
Published 12:00 p.m. ET Jan. 3, 2018

While everyone is getting into the holiday spirit of giving, a colleague of mine in the Ohio House is circulating six dangerous and divisive amendments to our Constitution. Amendments that would only take away from working families.

These radical changes to the Ohio Constitution and anti-family ideas are corroded with the fingerprints of the billionaire Koch brothers and anti-American propaganda organizations Americans for Prosperity and the American Legislative Exchange Council (ALEC). These special interest groups are driven by greed and power. It makes absolutely no sense that people with that much money would spend so much time, effort and resources trying to deprive working people of food on their table, roofs over their heads, and day-to-day dignity and security.

The six proposed amendments to the Ohio Constitution are all related to a nefarious and deceptive concept known as “right to work.” Time and time again, we’ve seen that right-to-work experiment leads to lower wages, more injuries and deaths in the workplace and employees are stripped of their voice and rights. But failed experiments don’t seem to get in the way of destructive ideology.

The bottom line is this: lawmakers elected by Ohio citizens should not sign on to an agenda directed by out-of-state special interests who don’t care about the people we are elected to serve.

We’ve been down this road before. In 2011, the out-of-state interests pushed lawmakers to ramrod Senate Bill 5 through the process in order to deny employees of their collective bargaining rights. We successfully fought back by collecting 1.3 million signatures, amassing 17,000 volunteers and vetoing SB 5 by a 62-38 percent margin. In 2011, SB 5 was unfair, unsafe and hurt us all. Today is no different.

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Sussex County Council defeats right-to-work ordinance (DE)

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Officials site potential legal costs and lack of authority to enact measure

By Ron MacArthur
January 9, 2018

Sussex County Council voted 4-1 to deny a proposed right-to-work ordinance. The action follows a prolonged Jan. 2 public hearing as well as testimony during public comment periods over the past three months since the ordinance was introduced.

Union members have attended every meeting since introduction and protested against the ordinance Jan. 2 and Jan. 9 on The Circle in Georgetown.

At its Jan. 9 meeting, county attorney J. Everett Moore reiterated his stand that Sussex County Council does not have the right to enact an ordinance under the state’s home-rule statute. Moore spoke for nearly a half-hour providing background leading to his legal
opinion that only the Delaware General Assembly has that right.

After Moore’s presentation, Councilman Rob Arlett, R-Frankford, said there was a lot of information to digest. “It makes sense to defer based on what you just said. It’s a big decision,” he said, offering a motion to defer.

That drew jeers from the crowded council chambers.

Arlett, who introduced the ordinance as a potential economic development measure, failed to get a second on his motion. Arlett was the only councilman to vote in favor of the ordinance during the subsequent vote.

Council agreed that the cost of defending potential legal action in state and federal courts would impact the county’s budget, and could lead to the county losing its insurance company in the future. The four councilmen opposed to the ordinance agreed with Moore’s legal opinion.

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For military vets, unions offer camaraderie, careers and help adapting to civilian life

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JANUARY 9, 2018
BY B. DAVID ZARLEY

Laura Asher may be the tallest thing for miles.

Asher had climbed multiple ladders, lightly struck her helmeted head on a protruding hose, maneuvered through a small, greased aperture, and taken a seat at the controls of a luffing tower crane, roughly 80 feet above Illinois. She was far enough south that the skyscrapers of Chicago had given way to flat former prairie which seems to run, flush and forever.

The crane and its canary compatriots tower above the landscape, rivaled only by the wind turbine trainer and the stacks of shipping containers across a large pond from the William E. Dugan Training Center, where the Local 150 of the International Union of Operating Engineers trains apprentices and journeymen.

…

Asher’s father was an operating engineer, a member of the union, and he suggested she look into joining. With help from Helmets to Hardhats, a nonprofit that connects veterans with job training in the construction sector, Asher put in her application and was accepted to Local 150’s training program. The application cost $25 in processing fees and the training is free.

Millions of post-9/11 veterans like Asher-including those who served in Afghanistan, Iraq, against ISIS, and in the myriad other actions which constitute the War on Terror-have come home and transitioned from military to civilian life. While women made up a mere 4 percent of the veterans from the World War II, Korean War and Vietnam eras, the veterans from the second Gulf War and onward are 18 percent female, according to a Bureau of Labor Statistics report released in March 2017. Both male and female veterans’ unemployment rates hover around the 5 percent mark.

The study also found that in 2016, Gulf War-era II veterans, as they’re called, were unemployed at a rate similar to their non-veteran peers with one exception: men aged 25-35, whose unemployment rate was 6.6 percent compared to 4.9 percent for non-veterans. Veterans were also far more likely to work in the public sector than non-veterans, especially for the federal government.

This massive pool of workers is especially appealing to the skilled labor unions. Currently, Asher can be seen on televisions around the region in a commercial enticing veterans to train with the Local 150. Helmets to Hardhats, the trade union-sponsored nonprofit that connects veterans and soon-to-be veterans with job programs in the construction sector, was borne out of unions’ recruitment efforts.

“The veterans are coming from all over the nation and coming home,” said Robert Schwartz, senior program manager of Helmets to Hardhats. “So how do we reach out to them and let them know about these opportunities that we have for them for their next career?”

For the unions, veterans bring valuable benefits as a labor pool, both tangible and intangible.

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DOUGHERTY: Enforce the laws protecting workers (CO)

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BY MICHAEL DOUGHERTY
JAN 27, 2018

No one who works should be paid less than what they are owed. As Pueblo’s economy bounces back, protecting the workforce fueling our economy is now more important than ever. Colorado’s attorney general can and should play a key role in that vital effort because our labor force is the cornerstone of economic strength.

Other states have shown us the value of having an attorney general who enforces the rules and standards that guarantee basic employment rights. As attorney general, I pledge to engage the personnel and resources of my office to protect Colorado’s workforce.

Colorado’s workers are entitled to the right to be paid for a day’s work; the right to receive the minimum wage and any overtime pay or tips that are earned; the right to full payment of promised wages, without illegal deductions; and the right to have state and federal labor standards enforced.

As Coloradans, we have recognized how important these principles are. In 2016, Coloradans voted to raise the state’s minimum wage, with increases implemented over the next three years that far surpass the federal minimum wage — although it is still not enough for a lot of families. In 2014, the governor authorized the Wage Protection Act, giving the Colorado Department of Labor and Employment a better enforcement process to help employees who are denied their rightful wages. And last year, we passed a law requiring wage theft transparency, so that information is now available to the public about employers who are cited for stealing wages.

But there is much more to be done to ensure that our workforce is treated fairly. Coloradans are subjected to an estimated $750 million in wage theft every year. CDLE is on the frontline of this problem, handling the hundreds of individual wage complaints filed every year. But to truly advance fair treatment in Colorado’s workplaces, we need to take action on the broader problems affecting whole sectors of workers. Large portions of our workforce like those employed in the retail, restaurant, hotel and construction industries are particularly vulnerable to violations of labor laws.

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Two billion dollars in stolen wages were recovered for workers in 2015 and 2016-and that’s just a drop in the bucket

Posted by National Alliance for Fair Contracting on

EPI Report * By Celine McNicholas, Zane Mokhiber, and Adam Chaikof
December 13, 2017

What this study finds: In 2015 and 2016, a total of $2 billion in stolen wages ($880.3 million in 2015; $1.1 billion in 2016) were recovered for workers by the U.S. Department of Labor ($246.8 million in 2015; $266.6 million in 2016); by state departments of labor and attorneys general in 39 states ($170.0 million in 2015; $147.5 million in 2016); and through class action settlements ($463.6 million in 2015; $695.5 million in 2016). These represent wages stolen by employers who, for example, refuse to pay promised wages, pay employees for only some of the hours worked, or fail to pay overtime premiums when employees work more than 40 hours in a week.

Why it matters: Given that wage theft disproportionately affects workers from low-income households-who are already struggling to make ends meet-the loss of wages can be devastating. And these recovery numbers likely dramatically underrepresent the pervasiveness of wage theft-it has been estimated that low-wage workers lose more than $50 billion annually to wage theft. Regardless of what share of actual wage theft the recovery numbers represent, these data are one more reminder that wage theft is not isolated to a few bad employers, but affects workers much more broadly.

What can be done about it: Implement legislation to improve pay transparency; increase penalties for wage theft violations; support strong government enforcement of wage and hour laws; protect workers from retaliation when they report violations; and protect worker rights to collective and class action.

Introduction

The last four decades have been marked by rising wage inequality, with the vast majority of American workers experiencing wage stagnation while those at the top rung of the economic ladder reap the benefits of growth in productivity. These dynamics mean that many workers struggle to make ends meet; in 2016 one in fivefamilies in which at least one person worked were living below 200 percent of the federal poverty line (U.S. Census Bureau 2017).1 This situation is deeply exacerbated by wage theft, which continues to rob workers of billions of dollars in earned pay each year, with low-income workers being disproportionately affected (Bernhardt et al. 2009).

Wage theft occurs when employers fail to pay workers the full wages to which they are entitled for their labor. This includes, for example, refusing to pay workers the total amount of promised wages, not paying for time spent preparing a workstation at the start of a shift or closing up at the end of a shift, and not paying overtime premiums to workers who work more than 40 hours a week. Consider a full-time minimum wage worker earning the federal minimum wage of $7.25 an hour, around $15,000 per year. If this worker’s employer asks her to work 15 minutes “off the clock” before and after her 8-hour shift each day, that extra half hour of unpaid work each day represents a loss to the worker (and a gain to the employer) of around $1,400 per year, including the overtime premiums she should have been paid. This constitutes theft of nearly 10 percent of a minimum wage employee’s annual earnings-which can mean the difference between paying the rent and utilities or risking eviction or the loss of gas, water, or electric service.

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(Press Release)

(Full PDF of Study)

(IL) governor candidate Bob Daiber talks prevailing wage, right to work

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Prevailing wage, PLAs supported

By Kelsey Schulz
POSTED ON JANUARY 29, 2018

WOOD RIVER – Bob Daiber expressed his support of prevailing wage and project labor agreements, as well as his opposition to “right to work” laws, during a press conference in Wood River Monday.

Speaking at the Carpenters Union Hall, 277 E. Madison Ave., the Democratic candidate for the governor touched on those topics and more in front of a crowd that included 19 local labor leaders.

“As many of you know I’ve been a strong advocate for organized labor my entire political career,” said Daiber, who is also the Madison County Regional Superintendent of Schools. “I’m here today as a candidate for governor to continue my ongoing pledge to labor that we can move forward in this state collectively with good paying jobs.”

…

On prevailing wage: “I support prevailing wages, I always have. There’s no place in the workplace to drive down wages. If we do away with prevailing wages in the state then we are going to be competing with as to who as a worker is going to work for less and that is not a place that we want to go. When we have good jobs in the state that are based on prevailing wage we have workers that are being able to make a living wage and are less dependant upon the state for benefits and that’s the direction I want to move Illinois.”

On project labor agreements: “The project labor agreements are simply agreements between labor and management that help get jobs done on time, on budget with no shutdowns and workers being able to go to work each and every day without any work stoppages.”

On right to work: “Last year, I signed a pledge saying ‘no’ to right to work (for less) in the state of Illinois, because I am an advocate for collective bargaining both in the public and private sectors. As governor, I will sit down with AFSCME at the table and we will work out a contract for all state workers in Illinois because they too deserve to have good paying jobs and benefits.”

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Study shows prevailing wage led to more work done at a lower price (MI)

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By Erika Geiss
Jan 24, 2018

The word “Michigan” is practically synonymous with building and manufacturing.

From the auto industry that made our state famous to the “mighty” Mackinac Bridge that travelers still marvel at decades after its construction, our skilled tradesmen and women have driven us forward practically since statehood.

Yet we have trouble filling jobs in the skilled trades. It’s expected that Michigan will add 15,000 jobs in the professional trades every year through 2024, but we lack people with the training and experience to fill them.

One of the incentives these jobs offer is a good salary. That’s why it’s even more astonishing that special interests are trying to repeal Michigan’s prevailing wage law. These special interests, mostly contractors who hope to be able to pay their employees less, have worked to gather signatures to put the issue before the state Legislature or on the 2018 ballot.

Contrary to what you might have heard, the law doesn’t force companies to pay workers union wages or require that only union workers be hired for a construction job. It stipulates that for state-funded work projects, employees receive a pay rate based on a survey of actual wages and benefits in the area.

Studies suggest that if Michigan’s prevailing wage law is repealed, salaries for construction workers would drop by 20 percent to 50 percent. Just think about what it would be like to have your salary cut in half. Would you want to stay in that job? Most likely, you’d be looking for a new line of work. At a time when Michigan is trying to attract more skilled trades workers, repeal would be a terrible mistake.

…

Not only does prevailing wage ensure a good quality of life for people who choose these careers, it ensures that our roads and schools are built on time and on budget. It allows the workers to provide for their families and support local businesses while laying the groundwork – quite literally – for a well-built Michigan that will attract further investment.

We must protect Michigan’s prevailing wage law.

State Rep. Erika Geiss (D-Taylor) represents the 12th District.

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New Mexico Agrees to Strengthen Wage-Theft Enforcement (NM)

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By MORGAN LEE, Associated Press
Dec. 20, 2017, at 7:23 p.m.

SANTA FE, N.M. (AP) – A legal settlement has been reached to shore up New Mexico’s enforcement of laws against wage theft by employers who fail to pay or fully pay workers, a coalition of workers’ rights groups announced on Wednesday.

The settlement, if approved by a state district court judge, resolves accusation that the Department of Workforce Solutions failed to enforce provisions of the state’s Minimum Wage Act by improperly dismissing complaints, failing to pursue claims over $10,000 and not holding employers liable for damages.

It would require the Division of Labor Relations pursue more accusations of wage theft, make it easier for non-English speakers and others to file claims, and force negligent employers to pay back unpaid wages three-fold, the advocacy groups said.

New Mexico Center for Law and Poverty attorney Elizabeth Wagoner says more than 500 claims of wage theft are filed with the state each year. She estimated that state officials previously denied one out of every four complaints for improper reasons, while more claims were never filed because of administrative and language barriers.

…

The agency said some disputed policies and procedures have been in place since before Gov. Susana Martinez took office in 2011, without specifying which ones. Plaintiffs said the state failed to effectively enforce elements of a 2009 law designed to facilitate wage-theft investigations.

Provisions of the proposed settlement include:

-Lifting the $10,000 on claims of missing wages.

-Extends the statute of limitations for filing a claim from one year to three years.

-The Division of Labor Relations must seek damages on behalf of workers against employers.

-The state must provide Spanish-language claims forms and provide interpretation services for other languages.

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