Davis-Bacon Prevailing Wage Rate Reform

The Davis-Bacon federal prevailing wage law is a Depression-era regulation that requires the payment of the locally prevailing wage -- the wage paid to a majority of workers or the average wage in a given classification in given area -- on all federally-funded construction projects. The Davis-Bacon wage rate is supposed to be based on the information gathered via voluntary wage surveys. In reality, due to inefficiencies and inaccuracies with this archaic program, the federal prevailing rates are often the local union rates and not the prevailing market wage rates.

As a federally-supervised law, Davis-Bacon also requires significant paperwork and reporting. Many smaller businesses avoid bidding for projects that include Davis Bacon requirements because of the added paperwork and reporting requirements. The prevailing rate is an inaccurate, cumbersome system that adds more red tape and bureaucracy for those merit shop contractors who want to bid on federal jobs.

Davis-Bacon prevents the taxpayers from getting the best bargain on federal construction projects by eliminating true competition from the contracting process.

Status of Legislation: The 110th Congress considered several bills expanding Davis-Bacon into private sector and state-funded projects, including loan guarantee programs at the Department of Energy and tax credit bonds for energy production. This trend is expected to increase with the new administration and expanded majorities in the 111th Congress.

IEC Position: IEC opposes any legislation that would further expand the Davis-Bacon prevailing wage rate. IEC supports updating the federal prevailing wage so that accurate wage rates are obtained and the uncertainty and inefficiency is removed from the process.

Mandatory Paid Sick Leave

Legislation was introduced in the 110th Congress that would make drastic changes to current labor law and mandate that employers provide seven days of paid sick leave for all employees. The Healthy Families Act would create a new federal mandate requiring all businesses employing 15 or more individuals to provide 7 days of paid sick leave annually to all employees. Currently employers are not required to provide sick leave, though a vast majority do so on a voluntary basis as an employee benefit.

Status of Legislation: Yet to be introduced in 111th Congress.

IEC Position: IEC opposes the Healthy Families Act and any one-size-fits-all approach to this issue. Each business is unique and must be able to address personnel needs in a practical way.

RESPECT Act

The Re-Empowerment of Skilled and Professional Employees and Construction Tradeworkers (RESPECT) Act seeks to make drastic changes to the NLRA definition of a supervisor. The RESPECT Act would remove the duties of assigning and responsibly directing other employees from the definition of supervisor. The RESPECT Act also specifies that supervisors must "hire, transfer, suspend, lay off, recall, promote, discharge, reward, or discipline other employees" for a majority of their work time. These two semantic changes would eliminate almost all employees from the supervisor classification and potentially place them into a collective bargaining unit.

In order for a company to run effectively, it needs to know its supervisors are loyal to the company and that they will make decisions based upon efficiency and merit, not internal union politics or work rules. By the same measure, supervisors need to know that their decisions are subject to the authority of their employer and not to a union official. Effectively, this legislation would deny supervisor status to many hard-working Americans who have risen through the ranks and succeeded in becoming leaders in their workplace.

Status of Legislation: Yet to be introduced in 111th Congress, but expected to be among the first labor bills introduced and acted on.

IEC Position: IEC opposes the RESPECT Act and any attempt to strip away a standard that has long been a key part of the balance between management and labor.

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Mar 7, 2010 OPINION (The Pittsburgh Tribune-Review) It would further artificially inflate wages far above competitive, market-set rates and force even more businesses to say, "Why bother?" Pittsburgh remains in state receivership. Spending per resident outpaces comparable cities by nearly 50 percent, according to one study. Per capita taxes are...    more...  

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