Governor Whitmer orders reinstatement of “in effect salary” for state projects
LANSING – Gov. Gretchen Whitmer on Thursday ordered contractors on state projects to pay union rates for state construction projects, in a move that would overturn the 2018 repeal by the Assembly Michigan’s Republican-controlled legislative “effective salary” law.
“By reinstating the current wage, we are ensuring that workers are treated with dignity and respect, which starts with a fair wage,” Whitmer said in a press release scheduled to coincide with an event in Lansing at which she was joined by union leaders from the region.
The move is sure to attract opposition and possible legal challenges from GOP lawmakers who voted to repeal a state law that required payment of union wages on state projects, as well as business groups such as Associated Builders and Contractors of Michigan, based in Lansing, who oppose the requirement.
Whitmer cited state authority under the Management and Budget Act.
The act gives the Department of Management, Technology and Budget the power “to set contractual terms that benefit the state,” Whitmer spokesman Bobby Leddy said.
“The prevailing salary will ensure that the state gets the best value for money and the best trained workers for our public projects, so this is well within the purview of the DTMB contracting authority.”
The The Legislative Assembly voted to repeal the law in June 2018, claiming that this move was necessary to save taxpayers’ money.
Projects paying prevailing wages “cost 10 to 15 percent more than if they were built privately,” said Arlan Meekhof, a West Olive Republican who at the time was Senate Majority Leader and has since left the Legislature under term limits.
“The time has come to eliminate this outdated law and save our taxpayers’ money.”
The vote followed a petition campaign for the legislative initiative backed by Associated Builders and Contractors. Had the legislature not acted on the proposal, the issue would have been decided by Michigan voters in the November 2018 election.
The successful petition campaign bypassed an expected veto from former Republican Gov. Rick Snyder, who backed the current wage law as a way to encourage more Michiganders to fill skilled trades vacancies.
Democrats argued that repealing the law would both worsen the skills shortage and lead to substandard work, as it would reduce the training and apprenticeship of skilled workers provided by unions. They argued that the repeal would cost taxpayers this way.
“As governor, I am proud to stand alongside the workers and unions who have built the middle class,” Whitmer said in the press release.
“By restoring the current wage, we are ensuring that workers can earn a decent standard of living, saving taxpayers money and time on critical infrastructure projects, and providing Michigan with a workforce. highly skilled work to rely on as we build our roads and bridges, replace lead pipes, install high-speed internet, and more.
Tom Lutz, executive secretary-treasurer of the Michigan Regional Council of Carpenters and Millwrights, applauded the decision.
“This move protects Michigan’s infrastructure investments because when prevailing wages are expected, contractors must compete on a level playing field based on the quality of their skilled work, not the exploitation of their workers.”
Steve Claywell, president of the Michigan Building and Construction Trades Council, said the move “provides a fair and equal bidding process that allows highly qualified men and women to receive good wages.”
About two dozen states have eliminated existing wage laws in recent years.