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Conclusion

… by an unchecked, wide open tort system. The prevailing logic was to eliminate fault as a consideration … their own insurance company for medical coverage, wage loss and other benefits such as PIP. It was thought … qualifies as a serious enough injury, with the prevailing view giving the exception a much broader interpretation …

Michigan Labor Law

… labor unions. Michigan’s prevailing wage law, for instance, explicitly requires the adoption of union wages and benefits.[*] This language … rules.[23] [*] Michigan’s “prevailing wage law” requires construction … state-financed projects to pay “prevailing wages and fringe benefits at the same rate that prevails on projects of a similar …

Top 10 Budget Recommendations

… would save much more. » www.mackinac.org/5373 10 Repeal the state’s “prevailing wage” law, which prohibits awarding government construction contracts to the lowest bidder unless it pays above-market continued on other side wages. » www.mackinac.org/8907

The Consequences for Democratic Self-Government

… they must offer competitive wage and benefit packages if they … financial advisors, develop a wage and benefits package, and present … considerably. Modifications to wages and benefits must be negotiated … workers are content with their wage and benefits packages, the … provision has been held to prevail. One result of the dominance …

55 Specific Recommendations

… research shows that repealing the state’s prevailing wage law, which prohibits awarding state construction … the lowest bidder unless the company pays union wages, would very conservatively save the state at least … offices: an estimated $4.7 million Repeal state prevailing wage law: $90 million Impose a moratorium on all …

Appendix: Michigan Senate Bill 607

… with employers concerning ————————————— 1 grievances, labor disputes, wages, rates of pay, hours, or other 2 terms or conditions of employment. 3 Sec. … action for damages, 18 injunctive relief, or both. The court may award a prevailing plaintiff 19 costs and reasonable attorney fees. The civil remedy is …

Model Right-to-Work Language

… the purpose, in whole or in part, of dealing with employers concerning wages, rates of pay, hours of work, other conditions of employment, or other forms … damages, injunctive relief, or both. In addition, the court shall award a prevailing plaintiff costs and reasonable attorney fees. E. This section shall …

Introduction

… right-to-work states, increasing both wages and the number of jobs available. … pension system and a severe prevailing wage law pegged strictly to union construction wages — this has led to a more or … growth rates in employment and wages are somewhat lower for all … state laws (such as the prevailing wage) that make necessary state …

Endnotes

… of Labor and Economic Growth/Wage and Hour Division, telephone … Investigation, The New York State Prevailing Wage Law: An Investigative … 13 Armand Thieblot, Prevailing Wage Legislation (Philadelphia: … "‘Members Only’ Brief: Prevailing Wage Laws," February 25, 2005, … Majority: Pro-Union Bias in Prevailing Rate Determinations," Journal …

Appendix B

Graphic 3: Adjusted Median Wages vs. Michigan Prevailing Wage 2005* Class BLS Median BLS Adjusted† Prevailing Wage Percentage Difference‡ … Economic Growth * The state prevailing wage figures are provided by … percentage by which the prevailing wage exceeds the adjusted Bureau …

Appendix A

… Compensation vs. Michigan Prevailing Wage 2005* (Metropolitan Area/COUNTY) … Nonunion Total Compensation Prevailing Wage Percentage Difference Wage and Hour Division Categories … Shop Special Reports.” Prevailing wage data taken from the Michigan … Division. * The state prevailing wage figures are provided by …

Conclusion

… intentions behind the prevailing wage law when it was passed, … its current form. The prevailing wage law forces the payment of union wages on state construction projects … Michiganians. The need for a prevailing wage law is dubious, but lawmakers … well-intentioned Michigan’s prevailing wage law might have been when …

Revise the Prevailing Wage Law To Focus on Low-Wage Workers

… rein in the cost of the prevailing wage while leaving a floor beneath construction wages is to establish what might be called a "median-wage rule." Under this median-wage … agreements in setting prevailing wage rates, but the law would … to generating accurate prevailing wage determinations, this median-wage …

Change How the State Calculates Prevailing Wages

… state’s calculation of the prevailing wage so that it reflects actual … realize after repealing the prevailing wage law. Such a change would … redrafting of the law. The prevailing wage statute currently calls … rates in determining prevailing wages. The statute should instead … labor to calculate the average wages of all qualified workers, union …

Temporary Suspension

… Davis-Bacon Act allows the president to suspend prevailing wage requirements in cases of emergency, permitting … crisis, lawmakers should consider suspending prevailing wage as a means to balance budgets without increasing … the law’s suspension on Michigan’s construction wages, employment and quality.

Exempt Public School Construction

… effect of this exemption on construction labor markets should be minimal. Nevertheless, exempting public school construction from Michigan’s prevailing wage mandate could save taxpayers approximately $120 million annually, based on 2002 estimates.

Alternatives to Repeal

If policymakers are unwilling to repeal prevailing wage outright, there are a number of ways to reduce the scope of Michigan’s prevailing wage law or update its provisions to reflect the current state of the economy. …

Repeal

Michigan’s prevailing wage law increases the cost of construction … forces union work rules and wages on a construction industry … It is not clear that prevailing wage laws improve the quality … workers. To the extent that prevailing wage laws improve the productivity … also associated with prevailing wage states. And the prevailing …

The Overall Cost of the Prevailing Wage for Michigan Taxpayers

… conclude that Michigan’s prevailing wage law, by mandating union wage rates on all public construction, … mandates the payment of prevailing wages on any project where … negligible if Michigan’s prevailing wage law were repealed. The … assume that the state prevailing wage law increased construction …

Experience of Michigan and Other Jurisdictions

… among the states where prevailing wage laws have been repealed, … June 1997, Michigan’s prevailing wage law was held to be invalid … predicated on the payment of market wages. In 20 cases where nonunion … the suspension of the prevailing wage law, Vedder adjusted the … nonetheless concluded that prevailing wage suspension was responsible …

Overall Cost of Construction

… use of union rates in setting prevailing wages results in wages that are 40 percent to 60 percent … 25 percent of construction costs, the prevailing wage would add 10 percent to 15 percent … jurisdictions that have either added prevailing wage laws or granted exemptions from …

Difficulties for Bidders

Michigan’s prevailing wage law has had other significant effects … The practice of the state’s Wage and Hour Division is to use … classifications to create prevailing wage scales. This is a reasonable … specialization. A typical prevailing wage determination from the … imposed by Michigan’s prevailing wage. In such situations, potential …

Workplace Safety and Quality of Construction

… question of what effect prevailing wage laws have on workplace … rates in states with prevailing wage laws. Depending on the class of injury, prevailing wage laws were associated with … story: States without prevailing wages had significantly lower … states that repealed their prevailing wage laws between 1978 and …

Prevailing Wage, Productivity and Cost-Effectiveness

Prevailing wage advocates claim that by boosting construction wages, the law promotes a better-trained … in states with strong prevailing wage laws — but this does not mean that prevailing wage laws are cost-effective. … compared states with strong prevailing wage laws to states without …

Another Perspective: Prevailing Wages and the Larger Work Force

Under the state prevailing wage law, the workers receiving the … the city of Detroit’s "living wage," which is intended to ensure … wage.[36] Michigan’s prevailing wage law boosts these wages, … Wage and Hour Division’s prevailing wage determinations for Wayne … is not what Michigan’s prevailing wage law does. To the contrary, …

Prevailing Wage and Construction Industry Compensation

… biggest beneficiaries of prevailing wage laws would seem to be … because they receive union wages on every project. But the observed effects of prevailing wage laws are different. In … states that repealed their prevailing wage laws between 1979 and … Labor and Economic Growth’s "prevailing" wages to the average wages …

The Decline of the Union Movement in Michigan

… the terms of Michigan’s prevailing wage statute, the Michigan … exclusively in determining the prevailing wage. At the time the state … reasonable way to find a prevailing wage. While there are no reliable … union rates generally did prevail at the time Michigan’s law … prevailing wage law is based on wage rates for a shrinking minority …

The Effects of Michigan’s Prevailing Wage Law

A key problem with the high-wage, high-skill rationale, as discussed in detail … of the evidence indicates that prevailing wage laws do relatively little to … finding suggests that the artificial wage floor created by prevailing wage laws can result in higher costs …

The “High-Wage, High-Skill” Rationale

… work, the advocates of prevailing wage laws contend, tends to … from the new skills.[22] Prevailing wage advocates believe that … floor beneath construction wages on government contracts, the prevailing wage law counteracts this flaw … particular, advocates of prevailing wage laws have stressed the …

The Social Justice Rationale

… then be forced to increase wages to attract qualified workers, … at least tend to stabilize wages, rather than drive them further … government-funded project. The prevailing wage law is meant to protect … pass with Michigan’s prevailing wage law. * It has been argued … passage of Michigan’s prevailing wage law.

Rationales for Preserving the Prevailing Wage

… rationales for the enactment and retention of prevailing wage laws. The first is based on notions of social … workers on government projects from having their wages undercut as a result of “cutthroat” competition … The second rationale is that by establishing a wage floor for construction labor, governments encourage …

The Federal Davis-Bacon Act

The federal prevailing wage law is the Davis-Bacon Act of 1931, … many subsequent state prevailing wage laws, requires that construction workers receive "wages that will be determined by … secretary of labor to be prevailing for the corresponding classes … guidance as to how a prevailing wage is to be determined out …

Prevailing Wage Laws in Other States

Most states have prevailing wage laws, as does the federal government, … explicitly call for a minimum wage based on rates found in collective … of discretion to set prevailing wage rates, neither defining what constitutes a "prevailing" wage nor calling for the … detailed; Tennessee’s prevailing wage statute, for instance, …

How Wage Mandates Are Determined

… statute does not define a prevailing wage, nor does it provide any … and issued a separate prevailing wage, but it does specify that the determination of prevailing rates is to be based on … rates.[7] The WHD determines prevailing wages on a county basis, using … become a constant process — wage schedules are updated whenever …

Coverage

Michigan’s prevailing wage law governs the wages paid to all construction employees … construction is governed by the prevailing wage law, even when all funds … require the application of prevailing wages.[3] The statute requires … and fringe benefit rates prevailing in the locality in which …

Introduction

… requiring the payment of union wages and benefits to construction … government. The state’s prevailing wage law was enacted in 1965, … collective bargaining agreements "prevailed" in the construction labor … requirements. Thus, the prevailing wage law could have been seen … consequence, Michigan’s prevailing wage law now forces taxpayers …

Executive Summary

Michigan’s prevailing wage law requires that contractors on … construction projects pay union wages. Passed at a time when union … percent in 2006 — the "prevailing wage" now forces contractors … Michigan workers. The prevailing wage law increases the cost … taxpayers. Repeal of the state prevailing wage law would have saved taxpayers …

Foreword

… period when Michigan’s prevailing wage law for state-supported … Center Report "Michigan’s Prevailing Wage Law and Its Effects on … established that Michigan’s mandated wages were "prevailing" in name only; they did … projects. Michigan’s prevailing wage law and administrative …

The Effects of Michigan’s Prevailing Wage Law

Michigan’s prevailing wage law adds unnecessary costs to construction projects at taxpayers’ expense.

Prevailing Wage Laws

The state’s Prevailing Wage law, modeled after the federal Davis-Bacon Act, … state law could save 35 percent of the wage component of many construction projects, … not subject to Davis-Bacon, and that wages represented 20.6 percent of the costs, and the 35 percent wage savings noted above, then, potential …

Policy Reform Recommendations

… contract with neighboring cities or their county. The third set of key reforms relate to a variety of spending efficiency proposals: Eliminating prevailing wage laws; Making changes in state trunk line maintenance, including putting out to bid all state work in each county; Getting the state out of the …

IV. Grants and Financial Aid

… in lower spending and sales of unneeded state assets. In some cases, just a rule change would produce mammoth savings. Repeal of the state’s prevailing wage law for school construction alone, as Ohio has done, would stop the annual waste of more than $150 million. Even if money were no object, private-college …

2004 Addendum — More Savings and Revenue Ideas

May 2004

… repeal of Michigan’s Prevailing Wage Law of 1965 — which would … directly to schools. The prevailing-wage law applies whenever state … law, workers must receive the wage typical of those doing similar … pupil. Because of the Prevailing Wage Act, these costs are substantially … schools from that state’s prevailing wage law — saving schools an …

Fiscally Responsible Leasing of School Buildings and Facilities

… ownership of the structure would allow school systems to avoid additional costs imposed by federal and state mandates. Such mandates include prevailing wage laws, environmental regulations, and minority set–asides, which often add substantially to the costs of design and construction of publicly funded …

V. Improving Education for Michigan Children (2 of 2)

… public schools from the Prevailing Wage Act. Earlier in this document, Michigan's Prevailing Wage Act was explained as special-interest … the payment of union-scale wages and tends to lock out the majority … from compliance with the Prevailing Wage Act. Within the first … the time the Michigan Prevailing Wage Act was not in effect-from …

Endnotes

… MCL 408.552. Richard Vedder, "Michigan's Prevailing Wage Law and its Effects on Government Spending … http://www.census.gov/govs/estimate/9923mi.html. Ibid. "Michigan's Prevailing Wage Law Forces Schools to Waste Money," Mackinac … Construction and Renovation Projects from Ohio's Prevailing Wage Law: An Interim Report of a Five-Year Study, …

IV. Reforming Labor Law to Protect Worker Rights (1 of 2)

… growth, new jobs and rising wages, Michigan's economic performance … contributions.   22. Repeal the Prevailing Wage Act of 1965. Imagine … effects of the Michigan Prevailing Wage Act of 1965. It is a classic … requires workers to be paid "prevailing" wages and benefits.7  In … estimates that Michigan's prevailing wage law increases the cost …

Endnotes

… the "strength" of state prevailing wage laws, see A. J. Thieblot, … Evaluation of Impacts of Prevailing Wage Law Repeal," Journal of … The states with strong prevailing wage laws are Michigan, Illinois, … unambiguously was covered by prevailing wage legislation the entire … potentially might be liable for extra wage payments if they paid less …