Repealing prevailing wage would be irresponsible (MI)

Posted by National Alliance for Fair Contracting on

2018-05-03 / Viewpoint

There’s been plenty of buzz lately around the need for Michigan to update its infrastructure. But when the state sends workers into our communities to fill our potholes, construct our bridges or renovate our schools, we expect the job will be done well. We don’t expect it to take years for them to repave a few blocks of our neighborhood, or that the cherry picker helping assemble an overpass will become part of the community’s scenery as the project lasts indefinitely.

We expect the job will be done on time and will be high quality, and that’s all thanks to Michigan’s prevailing wage laws.

Prevailing wage has gotten a bad reputation lately, but at the end of the day, all it means is that workers are getting paid the local average for construction projects in the area, guaranteeing the workers earn an honest day’s pay for an honest day’s work. That is just common sense.

Critics claim it’s too costly to pay state construction and skilled trades workers a fair wage, and if we repeal our prevailing wage laws, the state will save money and our economy will get on the right path.

But as simple as that sounds, studies show it simply isn’t true.

A study published earlier this year analyzed the effects of repealing prevailing wage on Indiana’s economy in the three years since it’s been eliminated. Rather than enjoying prosperous economic benefits as promised, the state has since suffered with higher worker turnover and lower productivity.

Tim Sneller, State Representative
Burton

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A Missouri ‘right-to-work’ law is more likely to harm black workers, who are more likely to be covered by a union contract than other workers (MO)

Posted by National Alliance for Fair Contracting on

Fact Sheet * By Valerie Wilson and Julia Wolfe * May 15, 2018

The phrase “right-to-work” (RTW) refers to laws that prohibit unions from collecting any fees from nonunion members in a bargaining unit despite the fact that these nonmembers are covered by-and thus would still receive the benefits of-the union contract. These benefits include the right to have the union provide costly legal representation should a worker in the bargaining unit find it necessary to file a grievance against his or her employer. Contrary to how the phrase sounds, RTW laws actually restrict the rights of workers by cutting the financial support going to unions, thus limiting the ability of unions to help workers bargain for better wages, benefits, and working conditions.

Currently, 28 states, predominantly in the Midwest, South, and Southwest, have right-to-work laws in place. Later this year, voters in Missouri will decide whether to adopt a new RTW law approved by the state’s general assembly last year.

This fact sheet illustrates the disproportionate impact that a Missouri RTW law could have on African American workers, by highlighting the group’s strong representation among unionized workers in Missouri. This analysis is based on union membership data available from the Current Population Survey (conducted by the U.S. Census Bureau for the U.S. Bureau of Labor Statistics) for 2010-2017, the period since the end of the Great Recession

In national studies that control for other factors than can influence wages statewide, including the cost of living, wages are still at least 3 percent lower in RTW states than in non-RTW states. While Missouri workers of every race will likely see the negative impacts of an RTW law, black Missourians would be disproportionately harmed by this right-to-work law. That is because black workers are more likely to be covered by a union contract (“unionized”) than other workers. As shown in Figure A, in Missouri, 13.9 percent of all black workers are unionized, compared with 10.3 percent of all white workers, and 9.3 percent of all Hispanic workers. Within the private sector alone, 10.5 percent of black workers, 8.0 percent of white workers, and 9.0 percent of Hispanic workers are covered by a union contract. Black Missourians’ participation in private-sector unions is slightly higher than participation by black workers in the private sector nationwide (9.4 percent)

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Construction Unions Ally with Striking Teachers to Fight for Prevailing Wage Laws (NC)

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BY: MIKE ELK
MAY 15, 2018

As North Carolina teachers go out on strike tomorrow, they will be joined by the ranks of the state’s construction unions. Much like teachers, who lack the right to collective bargaining in the state, construction workers employed on North Carolina’s state-funded projects, such as schools, lack the ability to have their wages set by union-endorsed prevailing wage standards.

They say the lack of collective bargaining rights for public employees in North Carolina is symptomatic of how the state also undervalues all workers employed on projects financed on the public’s dime.

“When your public employees are organized, it sets the standard and foundation for everybody else,” says North Carolina IBEW Local 379 President Scott Thrower. “When they are not, the private sector is setting the ground.”

While construction workers in other states enjoy the benefits of prevailing wage standards, construction workers in North Carolina do not. Under prevailing wage standards, contractors are forced to pay the median wage that construction workers are paid in that region as determined by a government survey-the idea being that government-funded projects are supposed to keep wages from falling.

“Prevailing wage levels the playing field,” says Thrower.

Without a prevailing wage, contractors on state-funded projects can simply pay their workers whatever they want.

While unionized electrical contractors in the state, working on federally funded projects that use prevailing wage standards, make a minimum of $25 an hour with retirement and health care benefits, non-union electrical contractors work on state-funded projects that often pay as little as $15-$20 per hour due to the lack of prevailing wage standards on state-funded projects.

Worse, union leaders say the lack of prevailing wage standards negatively affects high road contractors, who use higher training and safety standards.

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Laborers on a ‘Billionaires’ Row’ Tower Cheated of Wages, D.A. Says (NY)

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By James C. McKinley Jr.
May 16, 2018

The laborers were doing concrete work on the luxury Steinway Tower at 111 West 57th Street, a needlelike skyscraper set to open next year full of condominiums for some of the world’s wealthiest people. But the company employing the $25-an-hour workers, the authorities said, was cheating them out of hundreds of thousands of dollars in wages by purposely shorting their hours and failing to pay them overtime.

The Manhattan district attorney, Cyrus R. Vance Jr., said on Wednesday that the company, Parkside Construction, and its affiliates stole more than $1.7 million in wages over three years from about 520 workers at the tower and seven other high-rise buildings. The company also hid nearly $42 million in wages from state insurance officials to avoid paying millions in workers’ compensation premiums.

Many of the cheated workers were undocumented immigrants from Mexico and Ecuador, Mr. Vance said. When the workers complained, they were falsely told the money would be in their next check or were encouraged to find work elsewhere.

At a news conference announcing the arrests, Mr. Vance said the victims were especially vulnerable to exploitation because they were not in unions and did not have immigration papers. “Often it’s the very people who are tasked with building this great city who are the most vulnerable to fraud from their managers and employers,” Mr. Vance said.

Parkside Construction and its co-owners – Francesco Pugliese, 39, and Salvatore Pugliese, 46 – were charged with grand larceny, insurance fraud and scheme to defraud. Also charged in the scheme were Parkside’s construction foreman, James Lyons, 54; its payroll manager, Yenny Duarte, 42; an outside accountant, Michael Dimaggio, 58; and the owner of a Michigan payroll company, Jerry Hamling, 57. The Pugliese family’s companies made more than $100 million off the masonry and concrete contracts for the eight buildings.

“This was a business model for these defendants,” Mr. Vance said.

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Pittsburgh sets minority employment goal for city construction projects (PA)

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AARON AUPPERLEE
Tuesday, May 29, 2018, 2:06 p.m.

Pittsburgh will require contractors working on the city’s biggest projects to ensure at least 12 percent of on-site employees are minorities.

An executive order Mayor Bill Peduto signed Tuesday set the 12-percent goal.
Peduto said the city expects to spend $1.1 billion on construction projects in the next 10 years.

“We realize that we are at the cusp of a boom that is going to happen in the city,” Peduto said at a news conference. “We want to open up that opportunity to everyone because here’s the secret: We’re going to need a heck of a lot more workers.”

The executive order creates what’s known as a project labor agreement for city construction projects totaling more than $500,000.

Contractors must guarantee against strikes, lockouts or other job disruptions. The city’s minority- and women-owned business requirements still apply in addition to the new 12 percent on-site minority employment stipulation. The executive order allows the city to select the lowest responsible bidder on a project, regardless of whether it is union or non-union.

Project labor agreements used to be negotiated on a project-by-project basis, said Grant Gittlen, community and public affairs officer for the mayor. The goals for on-site minority employment varied for each project. Gittlen said the goals have been low in the past.

Peduto’s office worked on the agreement with labor leaders for a year and a half.

Peduto said city Councilmen Corey O’Connor of Squirrel Hill and Dan Lavelle of the Hill District will work to push legislation that will make his executive order part of the city code.

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Using ‘subs of subs,’ contractors able to evade liability in construction worker deaths (TN)

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Mike Reicher, USA TODAY NETWORK – Tennessee
Published 10:00 p.m. CT May 5, 2018

After his brother died falling off the roof of a North Nashville home under construction, Hermenegildo Dominguez heard nothing from the roofing subcontractor. He heard nothing from the general contractor. Nothing from an insurance company.

Typically, workers’ compensation would have covered $10,000 of funeral expenses, but Alfonso Dominguez, 60, was essentially off the books. It would cost $15,000 to fly his body to his hometown of Vera Cruz, Mexico, and bury him.

Only after the Spanish-language news site Nashville Noticias posted about the June 2017 accident on Facebook did Hermenegildo Dominguez get a response. But it wasn’t from the construction companies. Other immigrants throughout Nashville sent him donations.

Today, Dominguez, who cleans construction sites in Nashville, is less concerned about compensation: “What I really want is to get justice,” he said.

Alfonso Dominguez’s death shows how some construction companies can evade liability for accidents, especially in a booming city like Nashville. A labor shortage has led to a fracturing of work sites, where subcontractors can’t complete projects with their normal crews, so they hire small “subs of subs” below them. Workers at the bottom are sent onto scaffolding and roofs without safety equipment or training, or the assurance their families will be taken care of if they fall.

More construction workers died in the Nashville metro area in 2016 and 2017 compared with any two-year stretch in the previous three decades. Most of the 16 deaths were from falls without any harnesses or other protection.

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Register Now – 20th Annual NAFC Conference, August 19-22, 2018 – San Diego, CA

Posted by National Alliance for Fair Contracting on

May 2018

It’s our 2oth Anniversary! Save the date and join NAFC at our next Annual Conference in sunny San Diego, CA. The Conference will be held at the Hilton San Diego Bayfront Hotel, in downtown San Diego. This year’s Conference will be jointly sponsored by the Center for Contract Compliance and will have a national as well as a California specific focus. The NAFC National Conference is attended by participants from across the nation, including representatives from labor organizations, responsible contractors, fair contracting compliance organizations as well as researchers, academics, attorneys and officials from federal, state and local governments.

Stay tuned for further information.

(Visit NAFC’s Conference Page)

(Download Joint Conference Registration Form)

California Supreme Court Adopts Broad New Misclassification Test

Posted by National Alliance for Fair Contracting on

By Ashton Riley © Fisher Phillips
May 2, 2018

In a groundbreaking decision, the California Supreme Court adopted a new legal standard that will make it much more difficult for businesses to classify workers as independent contractors, drastically changing the legal landscape across the state.

The decision will directly affect the trucking and transportation industry because the workers involved in the case were delivery drivers, but it also has the potential to affect nearly every other industry-including the emerging gig economy.

Specifically, the court adopted a new standard for determining whether a company “employs” or is the “employer” for purposes of the California Wage Orders.

Under the new “ABC” test, a worker is considered an employee under the wage orders unless the hiring entity establishes all three of these prongs:

  • The worker is free from the control and direction of the hirer in connection with the performance of the work, both under the contract for the performance of such work and in fact.
  • The worker performs work that is outside the usual course of the hiring entity’s business.
  • The worker is customarily engaged in an independently established trade, occupation or business of the same nature as the work performed for the hiring entity.

This decision not only expands the definition of “employee” under the California Wage Orders, it also imposes an affirmative burden on companies to prove that independent contractors are being properly classified.

As a result of today’s decision, all California businesses with independent contractors will need to conduct a thorough evaluation of such workers to determine whether they are properly classified.

The case is Dynamex Operations West, Inc. v. Superior Court, Cal., No. S222732 (April 30, 2018).

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ILR Impact Brief – New York State Prevailing Wage Law: Defining Public Work

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Publication Date 3-8-2018
Fred B. Kotler, Cornell University ILR School

Abstract

New York’s prevailing wage standards require that contractors on state funded construction projects pay their workers no less than wage and benefit levels “prevailing” within the local construction market.

Much has changed since the prevailing wage was enacted by statute in 1897 and written into New York’s Constitution in 1938. “Public works” projects then typically meant construction of public facilities, funded by public money, for public use. Today public resources are leveraged creatively to attract private capital for economic development.

The commingling of the various forms of public support with private funding has blurred the definition or boundaries of “public work.”

Sixteen other states have statutes that more broadly apply the standards to include loans, tax incentives, and other forms of public support to private projects. New York is among ten other states that enable private developers to accept public money without paying prevailing wages and benefits.

This report examines the taxpayer interest in redefining “public work” to include both traditionally funded public works projects and private, economic development projects funded at least in part by public assets.

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(Full PDF of Study)

‘We value work:’ Richmond employers recognized for backing living wage

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POSTED 7:49 PM, MARCH 22, 2018, BY CAPITAL NEWS SERVICE

RICHMOND, Va. – Richmond community and business leaders gathered Thursday at the Washington Redskins’ training center to celebrate and discuss efforts to ensure a living wage for workers.

In a room overlooking snow-covered training fields, the introduction of the Richmond Living Wage Certification Program was mostly an hour of food and celebration for those present. Ten businesses and organizations – including Altria, the University of Richmond and the Better Housing Coalition – were recognized for going beyond the $7.25 minimum required by state and federal governments.

“Yes, jobs are important,” Richmond Mayor Levar Stoney told the gathering. “But jobs that are worked full-time and still leave those workers below the poverty line may help a corporate bottom line, but it will not help someone up from the bottom.”

The living wage program, a joint project of Richmond’s Office of Community Wealth Building and the Virginia Interfaith Center for Public Policy, is the first of its kind in the state. Reggie Gordon, director of the wealth building office, stressed the importance of ensuring that workers are compensated enough to lead a full life with economic stability.
“It’s not an overstatement to say that the people employed by the companies recognized today have a better chance to succeed in this community,” Gordon said.

The Richmond initiative uses calculations from institutions including MIT and the Economic Policy Institute to create a three-tier structure. The highest tier includes businesses that pay a minimum of at least $16 an hour (or $14.50 with health-care coverage). Six of the honorees met that “Gold Star” standard. Employers who have pledged to pay a living wage but aren’t able to yet were also acknowledged.

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