Prevailing Wage Act Requires Union-Level Wages for Some Workers

Michigan House Bill 4007, signed into law recently by Gov. Gretchen Whitmer, requires contractors for state construction projects receiving public funding to provide union-level wages and benefits for workers.

What is the history of the Act?

Before 2018, Public Act 166 of 1965 required state construction project leaders to pay workers wages and benefits that were not less than the wages and benefits prevailing in the locality where the work was performed. However, in 2018, the Michigan legislature adopted an initiative petition that repealed the Act.

What does the new law require?

The new law, which is substantively the same as PA 166 of 1965, restores the prevailing wage on all state construction projects. A state construction project is any new construction, alteration, repair, installation, painting, decorating, completion, demolition, conditioning, reconditioning, or improvement of public buildings, schools, bridges, highways, or roads authorized by a contracting agent.

Workers covered under the law include construction workers, laborers, helpers, assistants, or apprentices working on state projects. It does not include executive, administrative, professional, office, and custodial employees.

The law also requires that the Department of Labor and Economic Opportunity (LEO) establish wages and benefits at a rate that prevails on projects of a similar character in the locality under collective bargaining agreements (CBA) or understandings between labor organizations of construction workers and their employers. If no such CBAs or understandings exist, then LEO would determine the prevailing wage for that locality.

Help is available

The attorneys at O’Reilly Rancilio are available to answer questions regarding the prevailing wage law. To learn more, please call 586-726-1000 or visit our website.

Categories: Business