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Repeal Michigan’s Prevailing Wage Law

Author: Charles Owens Date: January 08, 2014

Repeal Michigan’s Prevailing Wage Law

With strong NFIB support, Michigan has already made union favored “Project Labor Agreements” on public construction illegal. Repealing Michigan’s Prevailing Wage Act is the next step in assuring fair and open competition on publicly funded construction projects. The state’s current prevailing wage law acts as a “super minimum wage” that sets wages much higher than local construction wages determined by fair competition in the free market. NFIB will be supporting legislation that will eliminate the prevailing wage requirement on public construction projects financed with state taxpayer dollars.


After years of NFIB effort, legislation has been passed that will prohibit union-only “Project Labor Agreements” (PLAs). This will end a practice by many local governments that shut out small business, non-union, companies from the bidding process. However, Michigan’s Prevailing Wage law is still on the books and needs to go.

Under Michigan’s Prevailing Wage Act, projects financed with state funding require that union wages and benefits be paid by non-union contractors. This increases the cost of a project from five to fifteen percent with no appreciable benefit to taxpayers. The law acts as a “super minimum wage” that sets wages much higher than local construction wages determined by fair competition in the free market. As a result, taxpayers are forced to overpay to build government projects and many small businesses are discouraged from participating in these projects.

NFIB will be supporting legislation that will eliminate the Prevailing Wage requirement on school construction as a first step in repealing the law in its entirety.
 

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