House Republicans strike down prevailing wage law

Published 10:48 pm Wednesday, January 4, 2017

House Republicans passed a bill out of committee Wednesday striking down the prevailing-wage law, which requires workers be paid average benefits and wages on public construction projects.

For several years, a Democrat House majority had thwarted efforts by House and Senate Republicans to repeal the law.
Sen. Wil Schroder, R-Wilder, has sponsored a prevailing-wage bill for the last two years that would have exempted schools from paying prevailing wage on projects of $250,000 or more. The bill was defeated in previous House committee hearings when Democrats were in the majority.

Bill Finn, director of the Kentucky State Building and Construction Trades Council, told members of the House Standing Committee on Economic Development and Workforce Investment that there’s no cost increase to construction projects as a result of the existing prevailing-wage law.
Finn said the costs of paying skilled workers are offset by having the work completed by a more efficient and proficient workforce.

“When you invest in construction worker training … you get a better, more productive worker. Getting the job done right the first time, on time adds value for Kentucky,” Finn said. “The construction labor costs of a project make up about 23 percent of total construction costs. All of the wages — the way prevailing wage is determined — from previous projects the year before, the previous 12 months. It (repealing prevailing wage) is going to affect every construction worker.”

Finn said state workers will lose out on jobs to out-of-state workers who would be able to compete with different wage rates. Training programs would in turn suffer funding for construction workers raising safety concerns if out of state workers were able to compete for bids on projects not paying prevailing wage.

“Kentucky has already tried saving money by cutting wages and benefits of construction workers 35 years ago and exempted schools from paying prevailing wage. It didn’t work then and it won’t work now. Local construction workers on local projects is what we need for Kentucky contractors. A lot of working people voted for a change in this election, but they didn’t vote for this. They didn’t vote for a pay cut.”

House Republican leadership has made the bill one of its priorities as House Bill 3. The Republican majority passed the bill out of committee 16-8, despite Democrat opposition.