San Jose ballot measure would force real estate developers to hire local

Posted by National Alliance for Fair Contracting on

By MARISA KENDALL
PUBLISHED: February 6, 2018 at 6:00 am | UPDATED: February 6, 2018 at 6:07 am

SAN JOSE – As Silicon Valley’s housing market booms, benefiting homeowners, landlords and developers, some activists say one group isn’t reaping its fair share of the profits: the local construction workers building these expensive homes.

A new ballot measure for San Jose seeks to change that. If approved by voters in November, the “Build Better San Jose” initiative would require developers of large, private projects to hire more local workers, and pay them better.

“Workers are not paid enough to be able to afford to live in the area,” said Louise Auerhahn, director of economic and workforce policy for public policy group Working Partnerships USA, which helped draft the measure.

Responsible Development San Jose, a coalition that supports local construction workers, is set to send the initiative to city officials Tuesday, the first step to putting it before voters in November. Once it is approved by the city, it will need 21,200 signatures to make it to the ballot.

If passed by voters, the measure would require developers in San Jose to pay workers the “prevailing wage” – a payment standard set by the California Department of Industrial Relations that varies depending on a worker’s location and specific type of work.

As of last year, the prevailing wage for construction workers classified as “laborers” in Northern California ranged from about $20 to $33 per hour. Developers also would have to put forth a “best faith effort” to hire locally for at least 30 percent of a project’s hours, hiring workers who live in San Jose or within 50 miles of the city’s limits. And developers would be required to help train new local workers by using one hour of apprentice labor for every five hours worked by an experienced worker.

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Guest Column: Protect prevailing wage to save jobs

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By Kevin Hertel, Special to Digital First Media
POSTED: 01/30/18, 3:35 PM EST

Michigan’s prevailing wage laws have helped mitigate the effects of this misguided perception. Passage of prevailing wage laws proved that we have had the good sense to make sure that the people who build our schools and office buildings, keep our air conditioners working in the summer and furnaces working in the winter, and come out to unplug our drains at all hours of the day and night will always earn a living wage. This law stands not just to serve as a “minimum wage for tradespeople,” it also protects small contracting businesses. Since everyone is competing at the same baseline pay scale, top tradespeople are not immediately drawn to a company that is able to pay them more than a mom-and-pop contractor. Prevailing wages, then, are simply wages that help all workers in the construction industry earn a fair day’s pay for a fair day’s work.

The bottom line is this: Michigan is a manufacturing state. Our economy cannot exist, let alone continue its upward trend, if we pull the financial rug out from underneath skilled trade workers and leave no benefits to working in the trades. Every legislator I know would say that Career and Technical Education is the key to a successful state-many have worked to ensure that their centers for it are state of the art, as is Macomb County’s. However, if prevailing wage is repealed, this push will have been for nothing-no one is willing to go through that much training and certification to end up making $9.25 an hour. Repealing prevailing wage puts the future of our state at risk.

Democrat Kevin Hertel is a state representative from St. Clair Shores.

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Veterans speak out about prevailing wages in Lansing

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By News 10
Posted: Tue 12:17 PM, Feb 27, 2018
Updated: Tue 7:26 PM, Feb 27, 2018

LANSING, Mich. (WILX) – A group of Veterans gathered in Lansing Tuesday to speak out about and support the prevailing wage vote.

Veterans from three skilled trade unions talked at a press conference at the Michigan Senate building on Tuesday morning.

Their message, “a vote against prevailing wage is a vote against high-quality jobs that allow veterans to support themselves and their families.”

…

“Veterans bring with them the experience, grit and sense of unity necessary to succeed in the skilled trades,” said Brad Reed, a business representative for the Michigan Council of Carpenters and Millwrights (MRCC) and Army veteran. “By protecting the prevailing wage, these high-skill, high-demand jobs are more available and accessible to our nation’s heroes.”

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Prevailing wage crucial for construction workers

Posted by National Alliance for Fair Contracting on

BY SAMANTHA DRAPER
POSTED 02.20.2018

It is sadly ironic that portions of the construction industry have been fighting for years to reduce wages on these important but dangerous jobs are now claiming they face a skilled labor shortage.

Just last year, California’s housing industry spent millions of dollars lobbying against minimum labor standards in any part of the residential construction sector. Even though research shows that construction labor represents a paltry 15% of total housing construction costs, they tried making the mathematically absurd claim that paying their workers enough to pay the rent -even in exchange for less red tape on certain projects – would somehow make California’s housing affordability crisis worse.

Some California contractors talking about labor shortages were trying to convince California municipalities to become “charter cities” so they could circumvent prevailing wage rules.

But they haven’t been the only ones.

Since 2015, five U.S. states have repealed their prevailing wage laws – laws that establish minimum wages for different skilled crafts on publicly funded projects and promote privately financed training programs that are designed to prevent skilled labor shortages. Other states are considering following suit, even though labor represents just over 20% of the total cost of public works projects – a historically small and declining share in what constitutes fully one-third of all output in America’s fourth-largest economic sector.

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bill-would-allow-cities-counties-to-opt-out-of-prevailing-wage

Prevailing wage a better value

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Henry Yanez
Published 11:00 p.m. ET Feb. 12, 2018

This year, special interests collected signatures to put the question of repealing Michigan’s long-standing prevailing wage law before the Legislature or on the ballot – often misconstruing the true intent of what their petition would do. They tell you it’s about saving you money. Nothing could be further from the truth. Let me tell you what prevailing wage is.

Michigan’s prevailing wage law ensures that our publicly financed buildings, roads, bridges and utilities are constructed using highly skilled and trained workers who are paid the regional average for their trade. The law doesn’t artificially inflate wages or the cost of construction and doesn’t force workers to be union members.

It just ensures that the people building our infrastructure earn a fair wage and benefits, and that their pay reflects their level of training. The law keeps skilled tradespeople and their families here in Michigan, where they spend money, grow the local economy and pay taxes.

Lowering wages reduces job productivity and lengthens the project schedule. Mistakes also happen when inexperienced, lesser-trained workers do the work. Michigan has already experimented with repealing prevailing wage in the mid-1990s. Costs went up and our skilled workforce went down. A study of highway and bridge work in 10 states found that high-wage workers built 74.4 more miles of roadbed and 32.8 more miles of bridges for $557 million less, compared to low-wage workers. Better and more efficient work for less money isn’t a difficult idea to get behind. …

Rep. Henry Yanez, D-Sterling Heights, represents Michigan’s 25th House district.

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California DA: Contractors failed to pay $200K in prevailing wages, state taxes

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Kim Slowey
Feb. 26, 2018

Dive Brief:

  • The Orange County (California) District Attorney’s Office has charged a group of contractors that performed work on the Pacific Amphitheater at the Orange County Fair and Event Center in Costa Mesa between 2013 and 2015 with underpaying workers and failure to pay state taxes, an amount totaling $200,000, according to the Los Angeles Times.
  • Prosecutors allege that the owners of AWI Builders, Zhirayr “Robert” Mekikyan and his wife, Anna Mekikyan of Pico Rivera, California, did not pay workers the prevailing wage rate established for the $10 million project, which was a new lobby and entrance area for the amphitheater, and created fraudulent records to conceal the supposed fraud. The DA’s office also claims that AWI did not report the correct amount of wages to the California Employment Development Department to avoid paying its fair share of state payroll taxes.
  • Also named in the suit is another one of the Mekikyans’ companies, Construction Contractors Corp., and a family member’s business, TOSC, Inc. Prosecutors allege that those companies also submitted forged apprenticeship certificates. An attorney for the Mekikyans said the charges against his clients are false.

Dive Insight:

Prevailing wage fraud is a problem nationwide, and local authorities have their hands full trying to root it out.

The Manhattan District Attorney’s office has categorized this underpayment of workers as wage theft and, in December, charged area construction companies, as well as their owners, with stealing nearly $3 million in wages from more than 400 construction workers. Manhattan DA Cyrus R. Vance Jr. said the companies stole employee pay through checks returned for insufficient funds, hourly rates lower than the prevailing wage, not paying overtime or not paying workers at all. The amounts not paid per construction company ranged from $13,000 to $700,000.

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Ninth Circuit Considers Challenge to Prevailing Wage Law

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BIANCA BRUNO
February 5, 2018

(CN) – The Ninth Circuit Monday considered arguments by nonunionized construction groups challenging a California wage law they claim prevents the open-shop industry from exercising its free speech rights.

The Associated Builders and Contractors of California Cooperation Committee and Interpipe Contracting appealed the dismissal of their case brought against Attorney General Xavier Becerra, Labor Commissioner Julie Su and Department of Industrial Relations director Christine Baker, which challenged the constitutionality of an amendment to the state wage law that went into effect in 2017.

Senate Bill 954 only allows employers who make payments to an “industry advancement fund” as required by a collective bargaining agreement to receive a prevailing wage credit through a state subsidy.

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(Order in ABC vs. Becerra)

Prevailing Wage, Local Workers Sought for Affordable Housing Projects

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Posted by Debbie L. Sklar
March 14, 2018

Builders who receive city money for affordable housing and public works projects would be required to hire skilled, local workers and pay them a prevailing wage under a proposal advanced by a City Council committee Wednesday.

Councilwoman Georgette Gomez’s “HireSD” program would aim to lift people out of poverty by requiring developers in certain projects to hire workers who have completed apprenticeships or other training because those workers are paid a higher wage. The resulting demand for skilled workers would create an incentive for economically disadvantaged people to complete that training as a “pipeline to middle-class jobs,” the councilwoman’s Chief of Staff Dominika Bukalova said.

The plan would also require developers of certain projects to hire local people and pay a prevailing wage, a minimum wage currently paid in certain public works projects.

The rules would apply to projects that receive money from the city’s affordable housing fund and a business subsidy program. Part of the proposal is an expansion of a 2013 prevailing wage ordinance that applies to public works projects.

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Guest Column: Prevailing wage supports Oakland County communities (MI)

Posted by National Alliance for Fair Contracting on

Andy Meisner is Oakland County treasurer
POSTED: 01/12/18, 3:12 PM EST

Big things are happening here in Oakland County. In November, Oakland County voters approved millions of dollars in public projects to improve our schools, sidewalks and communities – all smart investments in our future.

These projects show that our economy continues to grow. We’ve come a long way since the stagnant, cash-strapped Recession years, and we can make even more progress working together.

Unfortunately, some special interests in Lansing want to gamble with Michigan’s prevailing wage law in hopes of increasing their profits. That would create roadblocks to growth in Oakland County, and it’s the wrong move.

Repealing the prevailing wage is being hawked by special interests as a way to save taxpayers’ money. If that sounds too good to be true, it’s because it is. Repealing prevailing wage will send qualified workers out of state, leaving projects to lower-skilled workers. It will lead to expensive mistakes and cost-overruns that will be passed onto taxpayers when projects are built with cheap labor by out-of-state contractors, compromising safety and quality.

…

Prevailing wage is a smart investment that levels the playing field so local Michigan contractors have the opportunity to compete for public projects, without being undercut by the fly-by-night operations that employ cheap, low-skilled labor. By requiring all contractors who bid on a project to pay their workers a fair wage, quality contractors are challenged to work smarter and employ innovative ideas, not just cut costs by slashing wages.

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Prevailing wage supporters launching counter-petition (MI)

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Jonathan Oosting
Updated 11:25 p.m. ET Dec. 7, 2017

Lansing – A coalition of construction unions and contractors are launching a petition drive for an initiative to preserve Michigan’s prevailing wage law, an attempt to thwart a separate petition drive seeking repeal.

The state’s Republican-led Legislature could decide early next year whether to scrap the 1965 law, which requires union-rate wages and benefits on state-financed or sponsored construction projects.

But the Michigan Prevails coalition and the Protect Michigan Jobs ballot committee are urging legislators against taking up the repeal initiative.

“They can do what they want to do, but make no bones about it, we are not going to take this lying down,” said Patrick Devlin, secretary-treasurer of the Michigan Building and Construction Trades Council, who is helping organize the counter-petition.

The Protect Michigan Taxpayers ballot committee, funded largely by an association representing contractors who do not use union labor, last month submitted more than 380,000 signatures for a repeal plan. If approved by the Board of State Canvassers, the measure would advance to legislators.

…

“This isn’t just about the unions,” said Mike Crawford, executive director for the Michigan Chapter of the National Electrical Contractors Association. “This is very much a business issue. The prevailing wage law … makes sure that public construction projects are bid on an equal footing, at least as far as labor is concerned.”

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(Visit Michigan Prevails Website)