With record unemployment and the growing need for safety on the job, it is unfathomable that governors, legislatures and the Trump administration would look to weaken Davis-Bacon standards, better known as prevailing wage, during a pandemic. But that is what they are systematically trying to do.
We have seen the Department of Labor, at the direction of President Trump crony Eugene Scalia, an anti-union attorney who has made a career of working to hurt workers, and the National Labor Relations Board become partisan under Trump. These departments have looked at making changes to the Industrial Recognized Apprenticeship Program (IRAP), changes to wage determinations, and drag their feet on job misclassifications and contractor complaints.
Talks of a trillion-dollar capitol bill, a hallmark of the 2016 election of President Trump promising to fix America, slipped through the cracks. That trillion dollars could have not only gone to fixing our aging and crumbling roads, bridges and waterways, but also used to update our quickly outdated energy infrastructure – projects that would still be going on today providing good paying jobs with retirement and healthcare even during a pandemic.
Unfortunately, the President’s follow through on infrastructure is the same path of inaction he has used in his response to COVID-19 as a whole. A sustained and reliably funded capitol program could be helping us to weather some of the unemployment issues we are currently having.
When Davis-Bacon was passed in 1931 this nation was in our first great depression. People were struggling to find work and support and feed their families. The role of Davis-Bacon was to level the playing field for contractors so that a local going wage was applied to any contractor bidding a Federally funded project. This allowed, for instance, an Ohio contractor to not have to compete with lower-waged workers coming from Kentucky and elsewhere under-bidding them. Jobs are to be awarded on how quickly and efficiently a contractor can do a job and not on how low they can pay their workers.
When Davis-Bacon passed Congress, the goal was to not use Federal money to oppress worker pay but to get the best product that could be built for the taxpayers. We were in the height of the Great Depression and jobs could be the difference between life and death for a family. Davis-Bacon provides for living wages, benefits and training for people working and wanting to work in the construction industry.
For each hour of work under Davis-Bacon, a contractor is required to use money to help fund a training program. Unions have apprenticeship training programs that are certified and licensed by the Federal Department of Labor. They require apprentices to learn the skill and craft of their chosen field. The apprenticeships turn construction jobs into careers.
With the requirement of a training component to the awarding of Davis-Bacon contracts, we see not only local workers getting local living wages, workers receiving the training required to ensure that the job is done correctly. It also keeps a skilled workforce working and trained to tackle all jobs that they need to perform.
Under Davis-Bacon, the President is allowed to suspend the act in times of national emergency. However, the concept of national emergency is not defined in the statute. This suspension has only happened four times. In 1934, President Roosevelt suspended it for one week nationally to begin the implementation of the New Deal. President Nixon suspended it for one month nationally in 1971 to try and control inflation. President George H.W. Bush suspended it in 1992 in Florida, Louisiana, and Hawaii because of Hurricanes Andrew and Iniki, and it was eventually reinstated by President Clinton. In 2005, President George W. Bush suspended it for one month in Florida, Alabama, Mississippi, and Louisiana after Hurricane Katrina.
When the Chamber of Commerce and members of the Business Roundtable criticize Davis-Bacon, they do so because they believe that the workers that are building and updating our cities, roads and bridges are expendable commodities that should be bargained at the lowest possible wage – completely replaceable by anyone out of work walking down the street.
We must ask ourselves: do we want our kids going to school in a building built by people who are not properly trained? Do we trust our bridges being built by some person who has never been training in basic construction? Can we say that putting people’s lives at risk isn’t worth providing that person with a living wage, training, and benefits?
After congress passed the Davis-Bacon Act in 1931, individual states followed their lead. States like New York had actually passed their prevailing wage law prior to Davis-Bacon and are not looking at reducing its impact on construction, like is being called for by the business lobby, but actually expanding it to ensure workers are not being used as the lowest common denominator.
While states such as New York, California and Illinois have been able to sustain a working state prevailing wage, other states have taken the bait offered by big business and the Chamber of Commerce and chosen to remove or relax laws that govern the funding of state spending on construction projects. What those states have seen is a reduction in their construction workforce and projects that take longer to be completed because of the untrained workers who are working for reduced wages.
Some of the different approaches taken by states include:
- Ohio has gone back and forth with having a state prevailing wage. Currently it has a prevailing wage but certain projects are exempt, such as school construction.
- Illinois, while having one of the strongest prevailing wage laws, had to deal with former Governor Bruce Rauner who opposed updating the rates yearly even though every Governor since 1942, when the law was first enacted, had done so. Rauner was forced to defend these decisions in court and lost.
- Michigan, despite being unable to fix the drinking water in Flint and experiencing a record number of citizens leaving the state and out of work, had a GOP lead legislature that repealed a state prevailing wage.
Over the last 20 years we have seen a strong national push-back against Davis-Bacon. The anti-union contractors portray it as a boondoggle that rewards only unions with increased wages, usually in the 30-40% over local wages, and that it drowns out locally qualified contractors. The reality is completely the opposite.
Prevailing wage bases the pay and benefits a contractor is required to pay on Federal projects on the locally-going wage that is paid for the most hours worked in that area. Not the lowest, not the highest and not the average … whatever wage and benefits that are paid for the most hours worked. So, contracts end up being awarded based on how quickly and efficiently a project can be completed and now how unskilled and underpaid a worker is that a contractor will hire.
How does the repeal of state prevailing wage really impact the workers employed in these projects?
- Lowers wages – removing the focus from competently getting a job done and basing it instead on how little workers will take hurts all workers.
- It increases workers’ reliance on state and Federal assistance. Prevailing wage requires the payment of local going benefits, so workers and their families are forced to look elsewhere for help.
- It hurts the quality of work. Basing your workers’ pay on how little they will take for a job and not how skilled they are impacts the quality of that work. It also lowers the safety standards and understanding of safety on the job site.
When you remove the training and the wages you are left with projects that take longer to build and have a higher percentage of jobs that need to be fixed sooner if not more often. Unskilled workers without training tend to be less safety-conscious and that causes more workers to be injured on the job and sometimes unfortunately leads to an increased chance of death. In Texas, for instance, there are an average of 12 deaths a week in the construction industry.
When a federal project is built in an area it does more than just produce a building or fix a road or a bridge. The money that comes into that community under Davis-Bacon tends to stay in that community. Because Davis-Bacon pays the local going wage, we see more local contractors winning those contracts. Those local contractors in turn hire local workers. Those local workers then spend their money locally.
When a state gets rid of their prevailing wage, they see out-of-area contractors coming in to bid the work. They bring their workers with them and they take their money home when the project is complete.
At the end of the day, this isn’t a union or non-union issue. Nowhere in Davis-Bacon does it say union workers, nor does it say union wages. It says the local going wage that is paid for the most hours. If non-union contractors can do the job quicker and more efficiently than union, they get the contract awarded to them.
What we saw with the suspension of Davis-Bacon and what we see with the elimination of state prevailing wages is a drop in worker pay and worker benefits. The cost of materials and equipment still account for 65% of a construction project’s cost. On average, only 23% of a project’s cost goes to labor and 12% is profit. In order to get the savings being touted by the Chamber of Commerce of up to 20% on the cost of a project, the only way to do that is to reduce wages. Equipment and material costs do not change based on the prevailing wage rate, and profits won’t change under a removal of prevailing wage. So, it falls on the workers to receive less in pay and benefits.
What a general laborer receives across the country depends on whether or not a state has a prevailing wage rate determines what they get from federally funded Davis-Bacon projects:
- Non-Prevailing Wage states:
- Texas, Andrews County: $7.25 with no benefits
- Arkansas, Polk County: $10.42 with 32 cents in benefits
- Mississippi, Jackson County: $13.57 with no benefits
- Prevailing Wage states:
- Oregon, Benton County: $17.01 with $9.95 for benefits
- New York, Madison County: $28.05 with $23.74 for benefits
- Rhode Island, Bristol County: $31.80 with $25.05 for benefits
What this shows us is that workers make less for doing the same jobs. Nothing else changes in the projects that these workers perform. When they are paid a living wage and provided benefits as part of their work, they are less likely to be reliant on Federal and state assistance. Their children are more likely to have health insurance and their local economy reaps the rewards of their wages being spent locally.
These systematic attacks on workers are meant to lower wages, protections, and benefits for all workers. An attack on Davis-Bacon isn’t only an attack on construction trades, but on all workers, just as an attack on collective bargaining for public sector employees will be felt evenly by non-public sector workers. Weakening the playing field for one will weaken it for all workers down the line. We must stand together against these attacks on union and non-union alike.
The battle lines have been drawn for workers in this country. We can either go forward or allow the current administration to push us back to how things were before we were even born. We need to fight back on the job site, talking to our friends and neighbors and by making our voice heard with our vote.