Republicans Look to Amend Prevailing Wage Requirements

By Caleb Taylor | PA Independent

Taxpayers in Pennsylvania might save some money at the expense of workers under provisions approved by a state House committee Monday.

Changes to the state's so-called prevailing wage laws would release local and state governments from mandated wages paid to workers on public projects. Republicans and business groups argue that union contracts artificially inflate those wages, but Democrats and unions say the wages are appropriate and cutting them will hurt workers' wallets. 

Bills approved by the House Labor and Industry Committee would change the way the prevailing wage is calculated, raise the threshold for projects to qualify for prevailing wage and exempt school districts from having to pay the higher wages at a time when they are facing tough budgets as a result of state-level cuts. 

“The prevailing wage law in Pennsylvania is archaic,” said state Rep. Ron Marsico, R-Dauphin. “In today’s economy, things need to change. What’s happening now is many of the maintenance projects we have in the Commonwealth are being curtailed by townships and municipalities, because they simply can’t afford the prevailing wage.” 

Prevailing wage rates are set by union collective bargaining agreements on a county-by-county basis. Under the Prevailing Wage Act of 1961, all public projects that cost more than $25,000 must be completed by workers who are paid a prevailing wage. 

Frank Sirianni, president of the Pennsylvania Building and Construction Trades Council, a union representing 115 local construction unions in the state, said the bills were "guidelines to reduce workers' wages." 

"Even when you raise the threshold, you are eliminating projects where the (prevailing) wages are designated," said Sirianni. 

For example, an electrician in Cambria County working on prevailing wage would receive $50.24 hourly in wages and benefits, 78 percent higher than the average occupational wage of $28.11 for electricians in the same county. In Montgomery County, a plumber working on prevailing wage will make $65.94 in wages and benefits per hour, 56 percent higher than the average occupational wage of $42.29. 

The occupational wage takes into account all wages paid in the county, not just union wages. 

The prevailing wage "is a price control," said state Rep. Warren Kampf, R-Chester.

"When you set prices too high above the market rate, you decrease demand,” he said.

Democrats said the package of bills would result in more profits for businesses at the expense of workers’ wages. 

“It’s an unnecessary assault on working men and women when we can’t afford it. We are supposed to be preserving and creating jobs in this state. (Republicans) are swinging the pendulum too far over to business,” said state Rep. John Galloway, D-Bucks. 

The House Labor and Industry Committee along party lines approved the four bills that would change to the state's prevailing wage law:

• H.B. 1367 would require the use of occupational wage data to determine prevailing wage rates on a county-by-county basis.
• H.B. 1329 would raise the threshold for projects from $25,000 to $185,000.
• H.B. 709 would exempt school districts from prevailing wage rates unless they voluntarily chose to pay the rate.
• H.B. 1541 would raise the requirement for the amount of public funds a public project receives to qualify for prevailing wage rates from any amount of public funds to 51 percent publicly funded.

State Rep. Bill DeWeese, D-Greene, said the proposed changes could decrease the quality of work done on public projects.

"I want people that were trained in an apprenticeship. I want the best masons and carpenters available. (With this package) we’ll be driving down wages," DeWeese said.

Ronald Grutza, assistant director of government affairs for the Pennsylvania Association of Boroughs, which represents 915 boroughs in the state, called worries about labor done without a prevailing wage on public project “fallacious,” because most private projects don’t use prevailing wage workers and those are “just as safe.”

Senate Republicans have shown little interest in the prevailing wage issue in recent years.