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News Release: Republicans repeal Michigan prevailing wage law

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June 07, 2018

Lansing — Michigan’s Republican-led Legislature on Wednesday repealed the state’s prevailing wage mandate, capping a three-year battle over a law that required contractors to pay union wages and benefits on state-funded construction projects.

The measure was sent to lawmakers through a petition drive designed to bypass a veto threat from GOP Gov. Rick Snyder, who has said a repeal could hurt efforts to encourage careers in the skilled trades.

Lawmakers enacted the initiated legislation without Snyder’s approval instead of allowing it to go to the ballot for voters to decide.

“Taxpayers win,” Senate Majority Leader Arlan Meekhof, R-West Olive, said after a 23-14 vote to repeal what he called an “antiquated” 1965 law. “This is money they won’t have to spend on excessive costs for public works projects.”

The measure was opposed in the Senate by four Republicans and all 10 Democrats, who questioned GOP claims that repeal will save taxpayers money. They characterized it as an attack on construction worker wages that amounts to a forced pay cut.

 

“This is a circumvention of our democracy,” Sen. Curtis Hertel Jr., D-East Lansing, said in a fiery floor speech, “a game that is being played by this body to stuff money into the pockets of those who want the right to pay workers less.”

The House approved the repeal measure later Wednesday in a narrow 56-53 vote, with opposition from a handful of Republicans. Democrats protested on the floor after the majority gave the proposal immediate effect in a quick voice vote. 

Shouting from the gallery, where many labor groups were gathered, at times made it difficult to hear speakers throughout the debate and voting process.

 

State Rep. Gary Glenn, R-Williams Township, argued the 53-year-old law was rooted in historical efforts to avoid hiring lower-paid minority workers, calling it “a discriminatory and racist relic” that should be repealed.

The prevailing wage law has worked as a carve-out that protects some workers, said Rep. Lee Chatfield, R-Levering, but the law does not protect or benefit all of the people legislators are elected to represent.

"While not all of us and not all of our families are part of a union, I will tell you this: All of our families certainly are taxpayers," Chatfield said.

Chatfield said he takes exception to arguments that a House vote on the issue "takes away" from the people's right to a vote in November. The House had a constitutional obligation to debate and vote on the matter, he said.

Rep. Vanessa Guerra, D-Saginaw, said the repeal would be an attack on families and “the dignity that comes from working a well-paying job.”

At a time when more skilled workers are needed in Michigan, repealing the prevailing wage law will drive them away, said House Minority Leader Sam Singh, D-East Lansing.

"A vote for this repeal is a vote to condemn the economic futures of workers across this state,” Singh said. "You are telling workers across Michigan that they are not worth the cost of quality work.”

Repeal advocates argue the prevailing wage law inflates construction costs on state-funded projects, such as schools and government buildings. They hope the repeal measure will lower building costs and increase competition for public construction projects.

The repeal effort was led by the Associated Builders and Contractors of Michigan, a trade association representing “merit shops” that do not use union laborers. The group helped fund two statewide petition drives and advanced legislation this year after an initial failure in 2015.

State records show ABC of Michigan contributed more than $1.8 million in cash and in-kind services to the Protecting Michigan Taxpayers ballot committee over the past three years. The committee raised more than $3 million overall for the petition drives.

The Michigan Chamber of Commerce, the Small Business Association of Michigan and conservative groups joined ABC in a Monday letter urging lawmakers to repeal the wage mandate law.

“As states like Ohio, Indiana and Wisconsin cast this archaic government mandate aside, Michigan remains one of only six states that require union agreements to supersede all other wage and hour standards for state government construction,” they wrote.”

But union officials and labor-friendly contractors have argued that repealing the law would drive skilled workers to other states, inhibit job training and safety, and lead to poor-quality construction work. They claim wages fell 8.5 percent in Indiana after lawmakers there repealed a similar law in 2015.

Dozens of construction workers crowded into a fourth-floor meeting room at the Michigan Capitol on Wednesday ahead of potential votes, urging the GOP-led Legislature to protect the prevailing wage law and let the repeal measure go to the ballot instead.

“This is the wrong move for Michigan and threatens to slam the breaks on Michigan’s economic recovery,” said Tom Lutz, financial secretary of the Michigan Regional Council of Carpenters and Millwrights Local 1045.

“This vote is actually about the future of our workforce. It’s about the future of Michigan workers and Michigan businesses. It’s about making sure workers are trained and safe.”

Unions and friendly contractors say the prevailing wage law helps them fund apprenticeship programs that train the majority of Michigan workers pursuing careers in the skilled trades and ensure quality workmanship on taxpayer-funded jobs.

“Just like in the Army, they would never hand you a weapon on the first day and say go to war,” said Jessica Knight, a veteran of the U.S. Army Reserves and an apprentice with the Operating Engineers 324.

“Without prevailing wage, we wouldn’t have the mission-driven and highly trained workers for the jobs. We’d have low-quality cutting us out, people who can talk the talk, but they can’t walk the walk.”

Repeal proponents filed petitions signatures with the Michigan Secretary of State’s Office in November but certification was delayed amid a court battle over false addresses provided by circulators.

The Board of State Canvassers, as ordered by the Michigan Supreme Court, certified the measure on Friday and sent it to the Legislature.

“For the first time in over 50 years, the heavy hand of government favoritism will no longer overcharge Michigan taxpayers to build their schools and public buildings," Jeff Wiggins, ABC's state director and president of the ballot committee, said after Wednesday's vote. 

The Michigan Constitution gives lawmakers 40 days to adopt citizen-initiated legislation, allow it to go to the ballot or propose an alternative and allow voters to pick their favorite. A separate marijuana legalization initiative on Tuesday advanced to the November ballot after legislative inaction.