Prevailing Wage Repeal Showdown Expected in February

In November of last year, the petition signatures required to repeal Michigan’s Prevailing Wage Law were submitted to the Bureau of Elections. In reviewing the signatures, the Secretary of State indicated that 370 were found to be valid out of 535 examined in the sample drawn, short of the 373 required by the Board of State Canvassers’ statistical model. While labor union lawyers were quick to claim victory and press reports said our effort to repeal the Prevailing Wage was in jeopardy, the numbers were close enough that the Board of State Canvassers will conduct a second sample of 4,000 signatures before making a final recommendation on whether the petition should be approved. With 370 valid signatures (out of the 535 sampled) representing a 69 percent margin, it is almost a certainty that the larger sample size will produce the required number of valid signatures and the petition will be approved. However, the examination of the larger second sample will mean that the final decision and legislative action will be delayed until early February.

“NFIB has made it clear that this is an issue that should be acted on immediately by the legislature and not punted to a statewide vote.”

If the signatures are approved by the Board of Canvassers then the repeal language will be introduced into the state legislature as a proposed law. The state Senate and House then have 40 days to act on the proposal. If they pass the proposal it becomes law. If the proposal fails to pass or the legislature does not act on the proposal within the 40 days, then it goes on the November 2018 statewide ballot for a vote of the people. However, NFIB has made it clear that this is an issue that should be acted on immediately by the legislature and not punted to a statewide vote.

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 construction wages at the union scale, always higher than local construction wages determined by fair competition in the free market. The law also creates a mountain of paperwork and compliance hurdles for small businesses trying to bid on these state funded projects. Many small business contractors have given up on trying to win these contracts because of the artificial barriers thrown up by labor unions and regulators. With less competitive bidding, taxpayers end up paying higher costs for state funded projects. When asked if Michigan’s Prevailing Wage Law should be repealed, 77 percent of NFIB small business owners said “YES”. You can read more about this issue HERE.