Why the Infrastructure Investment and Jobs Act is good economics

Posted by National Alliance for Fair Contracting on

JUNE 30, 2022
AUTHORS: Michelle Holder & Shaun Harrison

Overview

President Joe Biden, in November 2021, signed the Infrastructure Investment and Jobs Act into law, providing $1.2 trillion in new government investments to create millions of jobs, increase U.S. economic competitiveness abroad, and help address the climate crisis. The multiple provisions of the law are now or will soon:

  • Create hundreds of thousands of jobs within the transportation sector, with investments in passenger and freight rail, bridges, roads, airports, ports, and public transit
  • Guarantee safe drinking water by eliminating the nation’s lead-tainted service lines, especially in disadvantaged communities that need refurbishing the most
  • Reduce supply chain bottlenecks to help ease inflation and lower the cost of goods and services
  • Build a national network for electric vehicle charging stations
  • Manufacture solar panels, wind farms, batteries, and electric vehicles to help address climate change
  • Make high-speed internet affordable and accessible

These much-needed investments are not only delivering significant macroeconomic benefits now, and will continue to do so well into the future, but also potentially addressing longstanding economic inequalities. Indeed, the new infrastructure investments and the jobs created by these investments can reduce these inequalities, increase unionization, and address climate change because they rest on sound economic principles.

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North America’s Building Trades Unions and Ørsted Agree To Build an American Offshore Wind Energy Industry With American Labor

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Wed, June 29, 2022 | Yahoo Finance

A first in the U.S., the National Offshore Wind Agreement sets industry on a course to build an equitable offshore workforce with family-sustaining careers

WASHINGTON, June 29, 2022 /3BL Media/– Today, North America’s Building Trades Unions (NABTU) and Ørsted, the U.S. leader in offshore wind energy, announced a Project Labor Agreement (PLA) to construct the company’s U.S. offshore wind farms with an American union workforce. A first-of-its-kind in the United States, the National Offshore Wind Agreement (NOWA) sets the bar for working conditions and equity, injects hundreds of millions of dollars in middle-class wages into the American economy, creates apprenticeship and career opportunities for communities most impacted by environmental injustice, and ensures projects will be built with the safest and best-trained workers in America. Authorized by 15 International Union Presidents and their local affiliates, the NOWA covers all of Ørsted’s contractors and subcontractors that will perform offshore windfarm construction from Maine down to Florida.

“The signing of this unprecedented agreement is historic for America’s workers and our energy future. NABTU’s highly trained men and women professionals have the best craft skills in the world. This partnership will not only expand tens of thousands of career opportunities for them to flourish in the energy transition but also lift up even more people into the middle-class,” said Sean McGarvey, President of NABTU. “The constant drumbeat of public support for unions being important to maintain and build the middle class helped secure this momentous achievement. We commend Ørsted, AFL-CIO President Shuler, the Biden Administration and many Congressional leaders for their help and support to make today’s signing a reality and for setting forth a new framework for middle-class job creation in all energy sectors.”

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Contra Costa DA’s Office and U.S. Department of Labor announce partnership to combat wage theft

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The Press.net | June 24, 2022

Contra Costa District Attorney Diana Becton and U.S. Department of Labor Assistant District Director for San Jose Alberto Raymond have agreed to combat wage theft and protect workers’ rights.

Wage theft affects victims in various ways – and at all income levels. Some workers are denied overtime or are paid less than the minimum wage per hour. Some employers also refuse to pay bonuses, vacation pay, or reimbursement of business expenses.

According to investigations by the Department of Labor’s Wage and Hour Division in 2021, U.S. workers were denied over $230 million in back pay.

The DA’s Office will be devoting resources to prosecute criminal wage theft cases to curtail labor trafficking, unfair business practices, payroll tax evasion, and wage and hour violations. To do this, District Attorney Becton will create a Workplace Justice Unit that’s committed to a fair and equitable workplace.

Becton noted, “While the DA’s Office and the Department of Labor have had an informal relationship on human labor trafficking and wage theft cases since 2014, this (deal) marks the start of a formal five-year partnership to continue our efforts to seek justice for victims of crime.”

Wage theft is a felony punishable by up to three years in jail. Employers caught stealing from their employees may be personally liable for unpaid wages and face criminal asset forfeiture actions, according to the U.S. Department of Labor Wage and Labor Division fiscal year 2021 data.

In addition to investigating and prosecuting cases, both agencies will conduct community outreach programs to inform the public about reporting wage theft — as well as provide resources for employers to help them follow labor and payroll tax laws.

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Illinois’ solar industry is looking to train a new generation of clean-energy workers

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By Jenny Whidden | Daily Herald – June 23, 2022

With Illinois looking ahead to its goal of 100% renewable energy by 2050, organizations are working to secure a workforce that is ready to install and maintain clean energy infrastructure, including solar arrays.

The passage of the Climate and Equitable Jobs Act last fall essentially pushed up Illinois’ previous goal of 25% renewable energy by 2025, setting a more ambitious target of 40% by 2030. With the state generating just 11% renewable electricity as of 2020, according to the U.S. Energy Information Administration, stakeholders say they are preparing to train a new generation of energy workers to respond to the lofty legislation.

“Given the significant amount of clean energy opportunities in the state, we certainly are going to need an expanded workforce,” said Lesley McCain, executive director of the Illinois Solar Energy Association. “The solar industry is open for business. We are hiring.”

Solar energy most recently accounted for 0.93% of the state’s electricity, creating about 5,200 jobs, according to the Solar Energies Industries Association.

One organization that is looking to ramp up workforce training in the solar space is the Mid-America Carpenters Regional Council, the state’s largest carpenters union.

The union’s four-year apprentice program provides solar panel installation training to its apprentices and collaborates with contractors to build solar projects throughout the state.

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The Aftermath: Developments from the 2022 Session of the Connecticut General Assembly Affecting Employers

Posted by National Alliance for Fair Contracting on

June 22, 2022
JD Supra

The 2022 Regular Session of the Connecticut General Assembly concluded on May 4, 2022.  While not as groundbreaking as the two last full legislative sessions, and while many far-reaching bills that emerged from committee were not passed by the legislature, important bills regarding employee free speech (i.e., the much vaunted “captive audiences” legislation) and employment protections with respect to domestic violence were enacted. …

PREVAILING WAGE ENFORCEMENT

Public Act 22-17 (“An Act Concerning Wage Theft”) authorizes (as of July 1, 2023) the Connecticut Commissioner of Labor to issue increased fines and citations (i.e., $5,000 per violation) to contractors and subcontractors who violate the state’s “prevailing wage” laws. The Act requires the Commissioner to maintain a list of contractors/subcontractors that during the three preceding years violated the prevailing wage laws or entered into a settlement with the Commissioner to resolve such claims. For each contractor/subcontractor on this list, the Commissioner shall record: 1) The nature of the violation; 2) the total amount of wages and fringe benefits making up the violation or agreed upon in any settlement; and 3) the total amount of civil penalties and fines. The Commissioner shall review the list each year for the preceding rolling three-year period and may refer for debarment any contractor/subcontractor that committed a violation during this period. The Commissioner shall refer for debarment any contractor/subcontractor that entered into one or more settlement agreements where the total of all settlements within the period exceeds $50,000 in back wages or fringe benefits or civil penalties or fines. Any such contractor/subcontractor may request a hearing before the Commissioner to contest such a finding.

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Murphy Administration Provides Guidance to Public Entities on Recent Changes to Prevailing Wage Laws

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Department of Labor & Workforce Development
June 21, 2022

TRENTON – With the summer construction season upon us, the Murphy Administration is reminding local governments and school boards of their role in protecting workers and expanding skilled apprenticeship programs, and their obligations under the New Jersey Prevailing Wage Act.

The New Jersey Department of Labor and Workforce Development (NJDOL) and its partners at the New Jersey Department of Community Affairs’ Division of Local Government Services (DLGS), and the New Jersey Department of Education (DOE), recently sent a letter reminding local governments and boards of education of their responsibilities under the New Jersey Prevailing Wage Act.

The New Jersey Prevailing Wage Act (N.J.S.A. 34:11-56.25 et seq.) establishes a prevailing wage for workers engaged in public work to safeguard workers and employers alike from unfair competition due to detrimental wage levels. The act requires the payment of minimum rates of pay to laborers, craftsmen, and apprentices employed on public works projects. Covered workers must receive the appropriate craft prevailing wage rate as determined by the Commissioner of Labor and Workforce Development.

“We have a responsibility to safeguard our workers and protect employers paying fair compensation and developing our workforce from being undercut by unfair competition,” said Labor Commissioner Robert Asaro-Angelo. “Our most important partners are the public bodies themselves who must also follow the law. Public contracting is a privilege, not a right, and it comes with certain responsibilities to other employers and our whole workforce.”

“Building a stronger and fairer New Jersey means ensuring that every hardworking individual in New Jersey receives the wages they should be earning in accordance with the law,” said Lt. Governor Sheila Oliver, who serves as Commissioner of the Department of Community Affairs. “This letter serves as a reminder to employers that wage theft and unfair competition will not be tolerated in New Jersey.”

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The Intersection of the Bipartisan Infrastructure Law and Davis-Bacon Act Requirements for Federal Contractors and Subcontractors

Posted by National Alliance for Fair Contracting on

The National Law Review
Friday, June 17, 2022

On November 15, 2021, President Joe Biden signed the $1.2 trillion Infrastructure Investment and Jobs Act into law, which is popularly known as the Bipartisan Infrastructure Law (“BIL”).

The BIL is estimated to create an additional 800,000 jobs. The United States Department of Labor (“DOL”) contends that such new jobs will “expand the middle class, revitalize our nation’s transportation, communications and utility systems and build a more resilient, reliable, and environmentally sound future.” The White House asserts that the BIL will provide protection to “critical labor standards on construction projects,” as a substantial portion of the construction projects included in the BIL will be subject to requirements of the Davis-Bacon Act (“DBA” or the “Act”).

While the BIL provides new revenue sources and opportunities for construction projects, federal contractors and subcontractors should ensure that their businesses comply with the DBA’s prevailing wage rates and labor standards requirements.

…

Practical Consideration in Compliance with DBA
Federal contractors and subcontractors should ensure that covered workers are properly classified for the work such individuals perform and paid in accordance with the prevailing wage rate for their classification.

Employers will often face recordkeeping challenges when they have nonexempt employees who perform covered (manual) work and non-covered (administrative) work in the same workweek.

In such instances, the employer must determine whether the employee is salaried or paid hourly. If the employee is salaried, the employer must determine whether the employee’s salary is greater than or equal to the prevailing wage rate for the employee’s classification. If not, the employer contractor is required to increase the employee’s pay for the week the covered work is performed.

Likewise, if the employee is paid hourly, then the employer must ensure the employee’s hourly rate is greater than or equal to the prevailing wage rate for the employee’s classification.

Federal contractors and subcontractors could face various consequences due to their failure to comply with the DBA, ranging from termination of the federal contract and debarment to a contracting agency withholding money due to the contractor to cover back wages due to employees as well as criminal prosecution. Accordingly, federal contractors and subcontractors should consult with legal counsel to ensure they comply with the various DBA requirements for any covered contracts.

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Illinois Joins Trend Making General Contractors Liable for Paying Subcontractors’ Workers

Posted by National Alliance for Fair Contracting on

June 14, 2022
JD Supra

On June 10, 2022, Governor J.B. Pritzker signed into law two related bills, HB 5412 and HB 4600, sent to him the previous month by the Illinois legislature that will hold a primary contractor (one who has a contract with an owner) liable for the unpaid wages and other amounts owed to employees of subcontractors, of any tier, on Illinois private construction projects. The bills, enacted as, Public Acts 102-1076, and 102-1065 (the “Acts”), will supplement the existing remedies in the Illinois Wage Payment and Collection Act (“WPCA”) for contracts made on or after July 1, 2022. Primary contractors already have liability for employee wages owed by their subcontractors on public projects covered by the Federal Davis Bacon Act, and the same responsibility is owed under the prevailing wage acts of many states, including Illinois. Primary contractors may also have liability for subcontractors’ wages on private projects pursuant to some states’ mechanics lien acts (including Illinois), as well as obligations contained in union collective bargaining agreements to which a primary contractor may be signatory. However, these amendments to the WPCA represent a significant departure from the well-established legal concept known as privity of contract, which provides that a contractor, with few noted exceptions, is not liable for obligations (including debts to workers) of its independent contractors, such as subcontractors on construction projects. This law will impose far-reaching and unpredictable liability for primary contractors in Illinois and, as a result, some construction industry experts foresee fundamental changes in the role of subcontractors on Illinois private construction projects. This article will discuss the new law as well as important exceptions within it. …

The enactments would expand a primary contractor’s liability to include debts due a subcontractor’s employee for “unpaid wages or fringe or other benefit payments or contributions, including interest owed, penalties assessed by the Department, and reasonable attorneys’ fees, but shall not extend to liquidated damages.” HB 5412, § 13.5 (c). Actions against a primary contractor may be brought by the unpaid wage earner or others on behalf of the wage earner, including the Illinois Department of Labor, which has the authority to impose civil penalties and seek criminal sanctions against liable parties for failure to pay compensation to employees. Under the WPCA, a liable party must pay, in addition to other amounts, attorneys’ fees incurred by the employee, interest, and an additional sixty percent (60%) per year for as long as the debt is unpaid. If a court interprets the 60% per year imposed by Section 14 of the WPCA to be liquidated damages, then a primary contractor would not be liable for that amount because liquidated damages are exempted. Further, though the liability imposed on a primary contractor under the new law includes “penalties assessed by the Department” of Labor, it does not expressly authorize criminal sanctions, which may be imposed under the WPCA against recalcitrant direct employers found guilty of not paying a wage earner.

The intent of some other provisions likewise is uncertain. For example, Section 13.5 (b) of HB 5412 includes this language: “A property owner who acts as a primary contractor related to the erection, construction, alteration, or repair of his or her primary residence shall be exempt from liability under this Section.” Since a primary contractor is defined as a party who has a contract with a property owner, it is difficult to imagine what was intended by the foregoing exemption, especially because the amendments impose no liability on owners. Also, it is unclear whether the following is intended to impose liability on the first-tier subcontractor, or on the subcontractor who fails to pay its employee, which could be a lower-tier subcontractor. Section 13.5 (d) of HB 5412 provides, in part:

Except as otherwise provided in a contract between the primary contractor and the subcontractor, the subcontractor shall indemnify the primary contractor for any wages, fringe or other benefit payments or contributions, damages, interest, penalties, or attorney’s fees owed as a result of the subcontractor’s failure to pay wages or fringe or other benefit payments or contributions as provided in this Section, unless the subcontractor’s failure to pay was due to the primary contractor’s failure to pay moneys due to the subcontractor in accordance with the terms of their contractual relationship.

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Notice of Proposed Revision to the Davis-Bacon Survey Collection

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Today, June 10, 2022, the Wage and Hour Division (WHD) submitted to the Office of the Federal Register for publication a notice of proposed revision to the information collection titled “Report of Construction Contractor’s Wage Rates.” WHD is proposing changes to the WD-10 form to improve the overall efficiency of the Davis-Bacon and Related Acts (DBRA) survey process. The proposed changes aim to streamline the collection of data required for the survey and make the collection less burdensome for respondents. The proposed revision rearranges questions and data requests to enable respondents to quickly gather and report information.

WHD is also proposing to add a new WD-10A collection instrument, which is a companion form to the revised WD-10 form. This new form will primarily be used pre-survey to identify potential respondents that performed construction work within the survey period in the survey area so that the Department can more effectively solicit survey participation.

There are 71 DBRA laws applicable to federal and federally assisted construction projects that require the payment of locally prevailing wage rates to approximately 1.2 million U.S. construction workers. The requirements currently apply to approximately $217 billion in federal and federally assisted spending on construction each year.

The DBRA requirements also protect workers under the unprecedented federal investments in infrastructure across the country. These projects involve clean energy, power and water infrastructure improvements, legacy pollution remediation, and renovation to the nation’s broadband and transportation infrastructures.

WHD encourages interested parties to submit comments on this proposal. Interested parties will have 60 days to submit their comments following notice in the Federal Register. Please submit comments by email to WHDPRAComments@dol.gov or by mail to the Division of Regulations, Legislation, and Interpretation, Wage and Hour Division, U.S. Department of Labor, Room S-3502, 200 Constitution Avenue NW, Washington, DC 20210.

For more information on WHD’s proposed revision, please visit the U.S. Department of Labor’s website. A complete listing of the proposed changes to the information collection is posted at https://www.dol.gov/agencies/whd/government-contracts/construction/surveys/wd10pra.

Polis signs wage theft bill into law

Posted by National Alliance for Fair Contracting on

June 10, 2022
by Robert Davis | The Center Square

(The Center Square) – Colorado Governor Jared Polis signed a bill Thursday that increases penalties for businesses that withhold earned wages from workers without warrant.

Senate Bill 22-161 classifies wage theft as criminal theft and imposes automatic penalties of up to twice the withheld amount or $1,000, whichever is greater, against employers who violate the law. It also requires employers to pay an estranged employee’s earned wages within 14 days of receiving a written demand.

The bill was sponsored by Democrat Sens. Jessie Danielson, D-Wheat Ridge, and Sonya Jacquez Lewis, D-Boulder, and Reps. Monica Duran, D-Wheat Ridge, and Meg Froelich, D-Englewood.

“Wage theft is far too prevalent in Colorado, and it often hits working families the hardest,” Danielson said in a statement. “It’s essential that we support the folks who work hard to keep Colorado’s economy running. This law will ensure workers receive the full wages they have earned.”

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