Pennsylvania Looks to Amend Definition of Prevailing Wage

Earlier this week I posted about the GAO study which found serious flaws in the way the DOL formulates prevailing wage rates that must be paid to employees on federally funded construction projects. 

The Davis-Bacon Act applies only to federally funded construction projects.  However, most States have so called “little Davis-Bacon” Acts which require prevailing wages to be paid on State funded construction projects.  Pennsylvania is one of those States. 

I mentioned that one of the most troubling flaws in the way the DOL determines wage rates on federal projects was the concept of “union prevailing” wage rates.  As I noted, if DOL wage rate surveys reveal that the wage rate in an area is equal to the union rate then the wage rate become pegged to the union rate basically forever. 

Pennsylvania’s little Davis Bacon Act goes a step further than its Big Brother and requires that the prevailing wage rate on State funded construction projects is the union wage rate per se.  In fact, the Deparment of Labor & Industry uses data from collective bargaining agreements in determining the prevailing wage rate for State projects.  Well, it looks like Rep. Ron Miller, R-York, chairman of the House Labor and Industry Committee is fixing to do something about it.

As reported in on www.paindependent.com, the Independent reports that Rep. Miller wants to replace the “prevailing wage” with “occupation wage,” which would take into account all wages paid at the county level including non-union rates.  Rep. Miller estimates that the change in how Pennsylvania determines its wage rates on State funded projects would result in cash strapped local and state authorities saving between 25%-75% on labor costs. 

Understandably Big Labor has circled the wagons in response to Rep. Miller’s proposition.  Rep. Bill Keller, who’s district I can see from my front porch, said “[t]he prevailing wage does protect the taxpayers … by making sure that public works projects are done with the highest skill available.”  The Pennsylvania Building and Construction Trades Council has also spoken out against Rep. Miller’s proposal.

We will continue to monitor this legislation.  If it proceeds, Pennsylvania could become the latest front in the organized labor war.