Repeal Michigan’s Prevailing Wage Law

Date: December 27, 2015 Last Edit: June 13, 2016

Small Business Challenges in 2016

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. In 2016, NFIB will be running on two tracks to repeal Michigan’s Prevailing Wage Law by supporting both legislation and an initiative petition effort that will eliminate the prevailing wage requirement on public construction projects financed with state taxpayer dollars.

Although it is disappointing that Governor Snyder has indicated he will veto any bill to repeal prevailing wage, Republican lawmakers in both the House and Senate have already taken action to end prevailing wage. The House has introduced House Bills 4001, 4002 and 4003 that would repeal prevailing wage and the Senate has introduced Senate bills 1, 2 and 3 that would do the same. The first bills introduced in a new session by each chamber are generally reserved for the top policy priorities of House and Senate leadership. This move on the part of the legislature makes it clear that there is a serious disagreement between House and Senate majority Republicans and the Governor on this issue.

On May 14th, 2015 with strong NFIB support, the Michigan Senate passed Senate bills 1, 2 and 3. On Thursday, May 21, 2015 a citizen’s initiative proposal that would repeal Michigan’s Prevailing Wage Law was filed with the Secretary of State and approved by the Board of Canvassers on May 26th, 2015. On October 27, 2015, 388,000 signatures were turned in to the Board of State Canvassers for the initiative petition to repeal the state’s prevailing wage law – an avenue that does not require the Governor’s signature to become law (he would veto it otherwise). However, the vendor hired to collect and process the signature petitions did not remove duplicate signatures as part of the validation process prior to handing them over to the Board of State Canvassers (BSC) for review. As a consequence of this oversight, the Bureau of Elections recommended the Board of State Canvassers (BSC) not approve the petition for certification as there were only 229,629 valid signatures after the duplicates were removed. The Board of State Canvassers needs to verify that 252,523 signatures are valid before it can be sent to the Legislature for further action.

A new petition drive has already begun to collect the necessary signatures for another ballot initiative in 2016. NFIB will be teaming up with the Associated Builders and Contractors (ABC) and other free market groups to support the petition drive that will bring the initiated law before the legislature for action. Under Michigan’s Constitution, supporters have 180 days to collect about 252,523 signatures in order to put the proposal to repeal the Prevailing Wage Law before the legislature. If both chambers of the legislature pass the proposal within 40 days it becomes law without the signature of the governor being required. If the proposal fails to pass, or the legislature does not act within the 40 days, the proposal for repeal would go on the next general election ballot for the people to decide.

Update: The first petition drive effort failed due to a number of the submitted signatures being duplicates and not being removed by the firm hired to do the petition drive. Although a second petition drive was attempted before the deadline of June 1, 2016, the groups backing the drive announced a strategic decision to not submit prevailing wage repeal petitions to the Bureau of Elections. 

While this is a disappointing development, NFIB remains committed to repealing Michigan’s costly and wasteful Prevailing Wage Law and will be examining other options to move forward on this important small business agenda item. 


Stay tuned for further developments.

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