Updated prevailing wage standards ‘a tremendous win’ for tradespeople

June 10, 2024 by

Sen. Tina Smith (R) and Wage and Hour Division Administrator Jessica Looman announced new prevailing wage standards in Minnesota.

The Labor Department has updated federal prevailing wage standards in Minnesota, a move local Building Trades unions hailed as critical to ensuring that the tradespeople working on historic infrastructure investments passed during President Joe Biden’s first term are paid fairly and consistently.

Tom Dicklich, executive director of the Minnesota State Building and Construction Trades Council, called the Wage and Hour Division’s announcement “a tremendous win for the working women and men of Minnesota.”

“The implementation of new prevailing wage standards will provide our workers with the financial security they deserve and ensure that our construction projects are carried out by skilled, fairly compensated professionals,” Dicklich said. “We’re excited to see the tangible benefits this will bring to our communities.”

Under the new standards, the prevailing wage rates applied to federally funded building, highway and heavy construction projects will be the same as the state’s prevailing wage rates.

Minnesota’s prevailing wage rates better reflect the labor costs incurred by responsible contractors, like unions’ signatory contractors, Wage and Hour Division Administrator Jessica Looman said at a press conference May 31 at the St. Paul Labor Center.

Looman, who served as executive director of the Minnesota Building Trades council before accepting a post in the Biden administration, said the change to federal rates here is part of the “most comprehensive review” of prevailing wage standards undertaken at the Labor Department in “more than 40 years.”

“The new prevailing wage standards will ensure that workers on federally funded projects are compensated fairly, reflecting the true value of their labor,” Looman said. “This initiative will help close wage gaps and set a higher standard for transparency and fairness in the construction industry.”

Under the Davis Bacon Act, contractors carrying out most federal building projects are required to pay the local “prevailing wage” – an hourly rate, plus benefits – determined by the Labor Department. Many states and municipalities also have their own prevailing wage standards.

Prevailing wage laws ensure that workers on publicly funded construction projects are paid wages that reflect area standards – and prevent low-road contractors from squeezing workers’ pay in order to win a public bid.

The Wage and Hour Division announcement comes at a time when billions of additional dollars are being invested in Minnesota under two of Biden’s signature legislative achievements, the bipartisan infrastructure law and the CHIPS and Science Act.

Sen. Tina Smith, who joined Looman at the event, said the new prevailing wage standards add to Biden’s record as “the most pro-worker administration” in her lifetime. Smith ran down a list of pro-worker advancements since Biden took office, from expanding eligibility for overtime pay to banning noncompete agreements.

But the change will also benefit construction employers, she said, by streamlining the bidding process and ensuring greater fairness and transparency.

“This is a significant step in ensuring fair wages and consistency for our workers on federally funded construction projects,” Smith said. “From boosting American manufacturing and construction through unprecedented infrastructure investments to improving wage transparency for workers and contractors in Minnesota, we are making historic progress in supporting our workers and strengthening our labor unions.”

– Michael Moore, Union Advocate editor

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Dems’ climate measure ties tax credits to prevailing wage, apprenticeship

September 22, 2022 by

Matt Campanario, executive director of the Carpenters Training Institute, leads Sen. Tina Smith on a tour of the LJ Shosten Training Center in St. Paul, which houses the union’s pile driver and millwright apprenticeship programs.

The Inflation Reduction Act, signed into law by President Joe Biden in August, promises the most aggressive action to combat climate change in U.S. history, a $369 billion investment that aims to reduce carbon emissions by 40% this decade.

But what most excites some union leaders about the IRA are long-sought provisions that will ensure the transition to a cleaner-energy economy creates and sustains union jobs – and taps into the job-training capacity of unions’ registered apprenticeship programs.

In a win for Building Trades unions, businesses looking to claim tax credits available under the IRA must commit to paying prevailing wages and employing a minimum number of registered apprentices on their jobsites.

The requirements apply to most tax credits that were greatly expanded by the historic legislation, which Democratic majorities spent months shepherding through Congress.

The tax credits will spark private-sector construction of energy-efficient commercial buildings, housing and electric vehicle charging stations, as well as investments in energy sources outside of fossil fuels.

An analysis released by the University of Massachusetts at Amherst projects the IRA’s climate and energy investments will create 9 million jobs over the next decade.

By insisting on strong labor provisions, said Adam Duininck, director of government affairs for the North Central States Regional Council of Carpenters, Biden and other lawmakers ensured those investments will create good-paying jobs for skilled American workers.

“The expanded tax credits included in the Inflation Reduction Act will benefit businesses that pay prevailing wages and hire our apprentices,” Duininck said. “Paying workers prevailing wages will further support our communities where workers live and spend their money. This will give local businesses and our public services like education, public safety and well-maintained infrastructure the financial backing they should be receiving from hard working, middle-class workers.

“Our communities miss out on billions of tax dollars by unethical business practices of dishonest contractors. It is great to see support for those who conduct business in a manner that benefits people rather than lining the pockets of only a few individuals.”

Carpenters apprentice Amanda Heiser tells Smith recently passed infrastructure and climate bills “definitely provide a more stable future” for apprentices like her.

The IRA also includes penalties for firms that pledge to pay prevailing wages but don’t follow through, requiring them to make workers whole – plus interest.

Meanwhile, industrial unions hailed domestic content requirements included in the IRA, which will encourage the use of American-made batteries, solar and wind components and other technologies on clean energy projects.

The requirements will stimulate job growth in the U.S. manufacturing sector, said Jason Walsh, director of the BlueGreen Alliance, which brings together unions and environmental groups.

“Few pieces of legislation this century have come close to such sweeping job creation potential,” Walsh said. “This bill’s investments offer an opportunity to support and create good union jobs and for workers and communities to reap the economic gains of the clean economy.”

For the Biden administration, the IRA delivers – again – on a campaign promise to make union jobs the focus of its economic policy.

A $1 trillion infrastructure law, which Biden signed in November 2021, is already creating work for union tradespeople in Minnesota. Over 100 projects statewide have tapped into $1.4 billion in federal funding available through the bill so far, including a $22 million project at Minneapolis-St. Paul International Airport.

Prevailing-wage rates are set by the federal government and vary by location. The rates reflect the average wage paid to similarly employed workers in a specific occupation in that area.

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Kera Peterson: To build back better, pass the PRO Act

February 4, 2021 by

Kera Peterson is president of the St. Paul Regional Labor Federation, AFL-CIO.

Millions of working people and their families are hurting in America right now. We’ve seen it firsthand at the St. Paul Regional Labor Federation, as our nonprofit Labor Studies and Resource Center has begun coordinating free food-distribution events with local unions. At four events so far, union volunteers have distributed thousands of packages of fresh food to families in need. During events at the Labor Center, the line of vehicles often spilled out of our parking lot and into West 7th Street.

These were families bearing the brunt of multiple crises facing our country right now: the COVID-19 pandemic, an economic collapse, chronic income inequality and systemic racism. While working Americans worry about eviction notices, job losses and exhausting their paid time off, U.S. billionaires are amassing even more wealth – over $1 trillion, combined, during the pandemic so far.

From Day 1 our federal government’s pandemic response has been bungled. President Joe Biden and Vice President Kamala Harris campaigned on a promise that we, as one nation, will build back even better than before.

At a time when working people are holding our country together, we have to do better than building back an economy where the rules are still rigged against us. The new administration understands that. The American people, who voted decisively and in record numbers to reject the politics of darkness and division, understand that too.

So what does building back better look like? It starts with direct and significant economic relief for workers and small businesses on Main Street, not Wall Street. Our local governments need aid too, as revenue shortfalls caused by the pandemic could force many to make steep cuts to services more essential than ever right now, like public health and public safety. And job losses resulting from cuts to public services would only deepen our economic crisis.

Building back better also means restoring fairness to our economy. It means leveling the playing field and giving working people more power to join together and bargain better wages, benefits and working conditions. Congress can do that by sending the Protecting the Right to Organize (PRO) Act to President-elect Biden’s desk in the coming months.

The most significant labor legislation in 80 years, the PRO Act would address several weaknesses in our federal labor laws, giving workers more bargaining power on the job. It would put teeth into rules prohibiting employers from retaliating against workers who try to form a union. It would require employers to disclose payments they make to union-busting law firms and consultants brought in to stifle workers’ voices. It would speed up the organizing-election process and establish a mechanism for workers and employers to arrive at a first contract quickly after an organizing drive.

House Democrats passed the PRO Act last February, but it never stood a chance in Mitch McConnell’s Senate. Today, members of Congress introduced the PRO Act again, and President Biden, who has said he wants his to be “the most significant pro-labor, pro-worker administration” ever, has pledged support for the measure. It’s encouraging to see that two congresswomen from our area, Reps. Betty McCollum and Angie Craig, are co-sponsors of the bill.

But the ideals behind the PRO Act – collective bargaining, a voice on the job, the belief that all work has dignity – are not Democratic or Republican. They are American ideals. It’s time for our leaders to put politics aside, to think big and to act boldly. Click here to tell your representatives to make the PRO Act a reality.

Our labor movement stands ready to build back better, together.

– Kera Peterson is president of the St. Paul Regional Labor Federation, AFL-CIO.

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