Opponents of Michigan’s prevailing
wage are campaigning for a ballot initiative as well as legislation to repeal
the law that guarantees fair pay to hardworking men and women.
Passed in 1965, Michigan’s prevailing wage law covers workers on state-funded construction projects. The prevailing rates are based on reported paid wages, including those from collective bargaining agreements, effectively resulting in union-level pay.
Ensuring such a wage discourages contractors from hiring out-of-state, low-skilled workers who can be paid less and easily exploited. Without it, union contractors are often priced out, resulting in less business.
The first three bills introduced in Michigan’s 2017 Senate session, all by Republicans, call for repealing the prevailing wage. One would eliminate it entirely while the other two would remove references in the school code and other areas. In May, pro-repeal groups also obtained approval for a ballot initiative.
According to Michigan law, once enough valid signatures are gathered – about 252,000 – the initiative then goes to the Legislature. If they accept it, it becomes law without the possibility of a veto by the governor. (While not always on the side of labor, Gov. Rick Snyder said he’s against repeal.) If not, the initiative goes on the ballot in 2018.
The last initiative attempt, in 2015, failed miserably, resulting in the state’s worst case of fraud, said Detroit Local 58 Business Manager Michael Richard, racking up over 160,000 erroneous signatures. A different firm was hired this time and it’s the same one hired to gather signatures for another initiative calling for the legalization of recreational marijuana. Richard says the canvassers are asking for both at the same time.
“It’s actually pretty smart if you think about it,” Richard said. “They can attract millennials with the marijuana question and then just say: ‘You’ve already signed one, how about two?”
In 2015, the IBEW along with the building trades, assembled a large cohort of supporters to defeat the repeal effort and they’ve kept them engaged, Richard said. Some are phone-banking and others are following the signature gatherers to correct any falsehoods perpetrated by them, something the gatherers did repeatedly last time.
“We’ve kept up a dialogue, so they’re ready to go this time too,” said Richard, who is also chair of the IBEW Michigan State Conference.
In a 2015 poll, almost 60 percent of voters supported keeping the prevailing wage, reported the Detroit News.
In 1994, Michigan experimented with a repeal on school projects, but the presumed benefits never materialized. Schools never saved money, worker abuse increased and unscrupulous contractors got richer. Three years later, the law was reinstated.
National research supports Michigan’s experience, finding that repeals result in increased injuries, a less educated workforce and reduced wages and benefits, pushing more people out of the middle class.
When the prevailing wage was repealed in neighboring Indiana, legislators were told it would save money. But that’s not what happened, according to Republican House Assistant Majority Leader Ed Soliday in a video on the Michigan Prevails website, a coalition of prevailing wage supporters including the building trades and contractors’ associations.
“So far it hasn’t saved us a penny,” Soliday said. “It did tick off the labor unions … Probably the most upset with us repealing the common wage was the locals, because the locals quite frankly like to pay local contractors and they like local contractors to go to the dentist in their own town.”