Prevailing Wage repeal will hurt small contractors, workers

By TIM ROWDEN

Editor

The Missouri Legislature has approved legislation changing the state’s prevailing wage law so that it will apply only to projects costing more than $75,000, a change that is likely to hurt small contractors and workers.

Legislators had originally sought a full repeal.

“I don’t’ like it,” said Senator Gina Walsh (D-Bellefontaine Neighbors) a retired member of Heat and Frost Insulators Local 1 and president of the Missouri State Building & Construction Trades Council, “but it is much better than a full repeal, and it is going to spare the industry.

“There are going to be places where we don’t set the rate any longer, but in some of those places, we don’t set the rate now. My hope is that it won’t be as bad as we think it will be, but my belief is that it will.”

Prevailing wage laws are designed to ensure that public sector construction jobs are bid based on equipment, materials and overall project management, rather than on the wages of the employees.

Missouri’s current law requires construction workers to be paid state-set minimum wages on taxpayer-funded projects, county by county, based on voluntary annual wage reports submitted by contractors. The law requires all workers, union or nonunion, to be paid the same wages on public works projects, including roads, bridges, schools and other public buildings. Where unions are strong, the prevailing wage has usually reflected the union wage, benefits and working conditions negotiated in union contracts.

Under the bill approved last week, which will take effect July 1, 2019 if signed by Gov. Eric Greitens, prevailing wage would apply only to projects costing more than $75,000.

WHAT WILL CHANGE

The fine print of the new law will restrict the application of prevailing wage even further:

• A minimum of 1,000 hours must be worked by a craft before a prevailing wage can be set for that craft in that specific county. That will be determined by the last county wage survey of contractors to determine the number of total hours worked by any specific craft.

• Occupational titles consolidated from 44 to 20. That means, for example, the variety of skills under the “carpenter” craft that had their own individual title – pile driver, millwright, floor layer which have slightly different wage rates – are now simply consolidated under “carpenter.” Based on the weighted average of all the various rates, this could mean an hourly wage cut for some crafts.

• A new construction minimum of 120 percent of the average wage for the county will be applicable to any occupational title in any county where less than 1,000 hours are documented.

• Unions can no longer file prevailing wage complaints, nor can an aggrieved contractor. Who can file is restricted to: a representative of a public entity; a contractor, if the complaint is against his or her subcontractor for work performed on behalf of a public body; a subcontractor, if the complaint is against his or her contractor for work performed on behalf of a public body; or a worker whose rights are alleged to have been violated.

• Prevailing wage will not apply for any project where the engineer’s estimate or the bid accepted by the public body is $75,000 or less for all occupational titles. That threshold will apply to the entire project and include the value of all work performed by all contractors, subcontractors, in addition to materials and supplies. The public body cannot divide the project into multiple contracts to lower the project cost below the threshold

• Public bodies exempt from competitive bids for any project under $10,000.

• Employers allowed to use “entry-level workers not to exceed a 1:1 ratio to journeymen workers. Entry-level workers will be paid 50 percent of the prevailing wage for a journeyman for that specific locality.

• Prevailing wage will be a weighted average of the total wage-fringe benefit packages for all Journeyman hours submitted by contractors. 

• Standardized overtime rates to include: Time-and-one-half after 10 hours per-day, Monday-Friday; time-and-one-half; double-time Sundays and holidays.

‘ELECTIONS HAVE CONSEQUENCES’

“This has been a rough couple of years for workers,” said Rep. Doug Beck (D-Affton) a member of Plumbers & Pipefitters Local 562.

“This bill was the culmination of two years’ worth of attacks on Missouri workers from billionaires, the Missouri Chamber of Commerce, corporations and the Republican Party,” Beck said.

“Make no mistake, elections do have consequences.”