The Indiana House has passed a bill that would eliminate the common construction wage law in the state, allowing the state and municipalities to decide the pay for each position of a public works project.
The common construction wage law sets base pay rates on public building projects in the state to ensure a decent wage for construction workers. It has been in effect in Indiana for over 80 years.
Supporters of the repeal say that the bill would reduce construction costs.
“This is going to let the free market work on public works project bids, so the taxpayers get the best deal for their money,” said state representative Jerry Torr (R-Carmel).
Opponents argue that repeal of the common construction wage would hurt Indiana workers and open the door to cheap, poorly skilled out-of-state contractors. This, opponents argue, would ultimately harm local and state government, since it would result in lower incomes for residents, lower tax revenue, as well as increased spending on safety net programs.
According to Paul Nysewander, executive director of the Indiana Mason Contractors Association, the common wage law helps ensure a living wage for the over 75,000 construction workers in the state who contribute over $21 million in state and local tax revenue each year. He also says that construction unions provide over 80 percent of apprentice training in the state, administer drug testing, and oversee OSHA safety classes to ensure workplace safety.
“All of this will be jeopardized if HB 1019 passes,” Nysewander says.
The AFL-CIO is also critical of the repeal vote.
“With today’s vote in the House of Representatives, the Republican supermajority has attacked the wages of working Hoosiers, a successful private sector business model and the autonomy of local governments,” says Indiana State AFL-CIO President Brett Voorhies.
“For decades the common construction wage has created a level playing field for contractors bidding on public projects, ensured skilled, local workers were hired and compensated appropriately and delivered world-class projects on time and on budget. In less than a week, following just one committee hearing, the representatives who supported House Bill 1019 have put this all at risk,” Voorhies adds.
The final vote in the Indiana House was 55-41 with a small number of Republicans joining Democrats in opposition. The bill now moves to the Indiana Senate. Governor Mike Pence has said that he would sign it should the bill reach his desk.
Whether or not the repeal becomes law, the city of South Bend says that it will continue to pay fair wages for construction workers in the city. The proposed repeal allows cities to continue to use common wages if they so choose.
Mayor Pete Buttigieg, who has come out against repeal of the existing state law, said in a statement that he was recommending that the Board of Public Works pass a resolution to affirm that common construction wages be paid on municipal projects exceeding $175,000.
“Experience has shown that well-paid workers lead to a healthier economy,” Buttigieg says. “South Bend will continue to observe prevailing wage practices because it benefits our city and our residents. Economic research has shown that eliminating the common construction wage would not significantly lower project costs, and what it will do is undermine local workforce apprenticeship training.”
Image Credit: Martin Brochhaus, flickr