Why should politics matter to you?

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American workers have felt a slow decline in their wages since the early 1980s, meaning wage increases have been slightly lower than the cost of living increase. This means less money for groceries, clothing, your children and the everyday essential you may need for raising a family or saving for retirement.

Union wages for the construction industry are no different, except unions have contracts that include wage increase, healthcare and retirement plans. With ongoing training programs for apprentices and journeymen this allows the workers to be more skilled than the nonunion workers. Productivity levels are higher, accidents are lower, and attitudes on job sites are more positive than ever before because of the investments in training by the members and their union. These union contracts are agreements between Labor and Contractors. The more highly skilled workers usually result in better wages, better working conditions and better benefits for their family.

On the other hand, payroll fraud is spreading rampant through the construction industry. This is where unscrupulous nonunion contractors choose to hire hourly workers and pay them cash or as independent contractors (1099s) by not withholding the employee’s state or federal tax deductions, FICA withholdings and Medicare deductions, leaving this responsibility on the workers to pay.

Learn more about payroll fraud

Who are my legislators in Kentucky?

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The Kentucky Legislative Research Commision provides a map to reveal the elected officials in your area. You can use the search by address at the top or select your location. By clicking on his/her bio page, you can find contact information including phone, email and mailing adress. We encourage everyone to reach out to your elected officials regarding issues of concern.

Fun Fact Friday

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Prevailing Wage Controls Costs

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A study of 3 states – including Kentucky – found no meaningful cost difference on school construction comparing states with and without prevailing wage.*

Why do the costs not go up with prevailing wage?

  • Labor only makes up 21% of total building construction costs in Kentucky. Reducing wages doesn’t produce any savings without paying workers illegally below minimum wage. However, productivity does drive the cost of construction. Skilled workers on prevailing wage jobs are 15% more productive than less-skilled workers.
  • Kentucky taxpayers get better project quality and self-sustaining jobs at no additional cost to the taxpayer. Lowering local standards for construction wages attracts a lower skilled, out-of-area workforce which results in large productivity losses, costly errors on the construction project, inefficient use of expensive materials and fewer jobs for Kentuckians.

*Kentucky’s Prevailing Wage Law, Phillips, P., 2014.

The Best Deal for Taxpayers

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“The prevailing wage, also known as common construction wage, supports skilled workers that build quality, safe schools for our children.  These schools are often built on time and within budget, making them not only a benefit for Hoosier children but a good investment for taxpayers.”

-Daniel Tanoos, Superintendent, Vigo County School Corporation

Source: BuildingStrongCommunities
High skilled workers finish projects on time and build quality roads and buildings meant to last – leaving tax payers with no cost overruns and lower maintenance costs over time. Projects built with common construction wage protect the taxpayers’ investment for several reasons. Productivity is the driving force behind the cost of construction. The high level of training and efficiency among common construction wage workers save taxpayers costly delays and errors. Skilled construction workers on prevailing wage projects are on average 15% more productive than less skilled workers on non-common construction wage projects. Workers are more productive while building a higher quality product that saves taxpayers in maintenance costs. Without prevailing wage policies, taxes would increase for residents.

Common construction wage jobs directly support privately funded training programs that prepare folks for successful middle class careers. In Indiana alone, the total support is about $42 million a year of private funds.  Without prevailing wage, this support would disappear and taxpayers would be on the hook to pay to train the labor force. In addition, typical workers not paid the common construction wage are eligible for thousands of dollars in public assistance, which costs taxpayers for additional reliance on cash assistance, food stamps, and healthcare – taxpayers don’t save, they subsidize.

Prevailing Wages Protect the Integrity of Projects With no Increase to the Taxpayer

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Source: BuildingStrongCommunities

Prevailing wage protects communities from unnecessary costs over the lifetime of a project. Research shows that lowering local standards for construction wages tends to attract a lower skilled, out-of-area workforce which results in large productivity losses on the construction project. These workers require more supervision and their work often needs additional review and repair before it can be deemed safe and secure.

Communities also may lose revenue through lower tax income that’s a result of local worker wages, which will also force taxpayers to subsidize the social services costs for low-wage workers eligible for government assistance.

Creating Good Jobs

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Projects paying the prevailing wage create local jobs because they are more likely to employ local residents. States that maintain prevailing wages ensure that local contractors and local residents can compete for the work their hard-earned tax dollars fund.  Local contractors bid on quality and productivity and out-of-state contractors don’t bring in a low-wage workforce that take jobs from local construction workers.

Common construction wage projects also directly support local training programs. These programs give local residents an entry point into a career in the building trades, and the people who benefit the most often come from communities surrounding prevailing wage projects. Others who benefit are our veterans, many returning from active duty in Iraq and Afghanistan. Through the Helmets to Hardhats program, these men and women receive the necessary training to successfully re-enter the civilian workforce. They learn skills that pay a wage such that they can support themselves and their family after serving their country. As government money for the Helmets to Hardhats continues to become less reliable, it’s more important than ever to maintain common construction wage jobs that support these programs.

Training programs also offer opportunities to young people, especially those unable or uninterested in pursuing a college degree. These training programs are open to anyone willing to learn a skilled trade and work hard. On-the-job training prepares them for a productive career, one that allows them to learn while they earn. The training programs also team with colleges to offer college credits for apprenticeship training. Once they graduate, these young people work to receive a wage adequate for supporting a family and contributing to their home community.

Prevailing wage is directly linked to job creation by generating jobs for local construction professionals, giving people an opportunity to learn a skill, earn a living, and support a community.

“My job for the Marines is construction, and the Helmets to Hardhats programs give me the opportunity to advance my skills doing work I can be proud of for the citizens I serve.  The common construction wage supports training programs which have helped me find work and make a good living.”

Tj Trinosky, Marine Reservist and Helmets to Hardhats 3rd Year Apprentice
Source: BuildingStrongCommunities

Driving Economic Development

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“The common construction wage provides good paying jobs in my district of the state. In turn, money spent by workers earning the common construction wage generates sales revenue locally and provides sales tax to the state’s general fund.” Indiana State Representative Lloyd Arnold, D74

Source: BuildingStrongCommunities

The benefits of paying prevailing wage extend far beyond workers’ paychecks. Those paychecks set in motion an economic ripple effect that quickly lifts the bottom lines of local businesses, shops and service providers. When working families have money to spend, they do so at local restaurants, shopping malls, and grocery stores– spurring additional job creation that keeps communities and businesses strong. In fact, studies show that every dollar spent on a prevailing wage project generates $1.50 in economic activity in the community.

Businesses looking to establish themselves in new cities look for this type of environment where a solid community and workforce will help their business grow. Contractors who pay workers as little as possible on public projects create high turnover in a workforce that has little or no consumer spending power to support local businesses. Businesses do not move into areas where low wages are the predominant means of income.

The concept of paying minimal or subsistence wages to save money is an illusion created by D.C. lobbyists interested only in increasing profits for their big business clients, and hurts our communities in the long run. With labor costs typically amounting to about 23 percent of public works construction project costs, a wage decrease of 10 percent would only affect overall project costs by 2.2 percent. That marginal savings evaporates long before a project is completed in errors and missing deadlines. Lower wages means lower-skilled workers, so projects go over time and over budget.

As for the city and local government, they are often left with substandard quality roads, bridges, and buildings that just don’t last. Taxpayers must pay for ongoing maintenance and repairs. Many of the low-wage workers are pushed into relying on government subsidies for healthcare, housing and other social services — all at taxpayer expense.

Local Carpenters build new facility for University and WJOB

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HAMMOND, Ind. -Carpenters from the Indiana/Kentucky/Ohio Regional Council of Carpenters (IKORCC) finished work on the new Commercialization and Manufacturing Excellence Center in Hammond. The Center, created as a collaboration between Purdue University and WJOB, is state-of-the-art and will be used specifically for workforce development in advanced manufacturing for achieving technological solutions and entrepreneurship.

Jim Slagle, IKORCC Representative and member of Local 599, said, “It was great to be part of this project. As union carpenters we are highly trained, and with such a cutting-edge facility, we definitely got to put that training to great use.”

Owner of WJOB, Jim Dedlow, was thrilled with the work the carpenters provided. “The quality of the work and efficiency of the workers was amazing,” said Dedelow. “They took great pride in their work.”

Slagle added, “This was also a great project for the entire region, and this building will be an asset to the local economy. As our community members utilize the facility and receive top-notch training, they will be able to better their careers, their families and ultimately our community and economy.”

‘Hybrid’ police merit rules pass council

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The council approved changes to Terre Haute’s “responsible bidder ordinance,” which proponents say would help ensure city public works projects use the best qualified workers and that contracts that bid are “using the same level playing field.”

The council first adopted a responsible bidder ordinance in 2010 Under the changes, bidders on city public works projects “shall provide evidence of participation in apprenticeship and training programs … which are approved by and registered with the U.S. Department of Labor’s Office of Apprenticeship, or its successor organization.”

The changes would apply to any general contractor bidding on a city public works project, as well as subcontractors, he said.

The tougher language also should help ensure local bidders are awarded the contracts, Joe Bolk, business manager for Laborers Local 204, said previously.

While the changes mean contractors would have to have registered apprenticeship programs, the changes don’t require that union labor be used, advocates say.

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