Unions take advantage of Illinois’ prevailing wage law

Paul Kersey

Labor law expert, occasional smart-aleck, defender of the free society.

Paul Kersey
/ Labor
October 28, 2013

Unions take advantage of Illinois’ prevailing wage law

When a state construction project goes up for bid, a union outfit often ends up with the contract. This is one of the seamier aspects of Illinois government. State laws and common practices for bidding are designed to cover up for union firms’ disadvantages and steer projects their way. The unions are always ready to...

When a state construction project goes up for bid, a union outfit often ends up with the contract.

This is one of the seamier aspects of Illinois government. State laws and common practices for bidding are designed to cover up for union firms’ disadvantages and steer projects their way. The unions are always ready to move when they see an opportunity to push nonunion contractors out of the way so they can nab more contracts and dollars. And there are lots of bureaucrats and elected officials who are willing to help.

Here’s an example.

The state’s prevailing wage law says that when the state or a local government takes bids on construction projects, all the workers hired on that project have to be paid “no less than the general prevailing hourly rate as paid for work of a similar character in the locality in which the work is performed.” This almost always is taken to mean the union rate, even though union workers make up less than 40 percent of the construction workforce. Union wages are often 50 percent higher than those of nonunion workers, and nonunion workers tend to earn better than average wages on their own.

The prevailing wage law doesn’t mean that union companies always win contracts. Nonunion companies can agree to meet the union scale and submit their own bids. But it takes away a natural advantage that nonunion companies have, and adds at least 10 percent to the cost of public construction, while the benefits go to unions and to construction laborers who generally don’t need special laws to earn above-average wages.

Of course, the more work is covered by the prevailing wage, the better for unions. Recently, Local 150 of the International Union of Operating Engineers, or IOUE, pulled off a little coup, maneuvering the state into applying the prevailing wage to site surveyors and material testers. These are fairly technical jobs: surveyors determine the precise locations of property lines, and they also make sure roads and buildings are put at precisely the spot where architects want them to go. Ground testers examine soil on construction sites to determine what loads they can support and what other requirements here might be in terms of environmental protection or water drainage, for instance) might be needed before you can build there.

Up to recently, these jobs haven’t been covered by the prevailing wage law, but last August the IUOE petitioned the Illinois Department of Labor to establish wage standards for surveyors and material testers, and in less than a month the state obliged. The new rule only applies in the Chicago area, but it is likely that the state will apply this to the whole state before too long.

According to the latest wage survey from the Bureau of Labor Statistics, the average hourly wage for land surveyors in the Chicago area was $30.44. But under the new rules, survey workers on government projects must be paid $37 an hour, while survey supervisors will be receive a minimum of $37.75 an hour. Contractors will also be required to pay the equivalent of $13.47 an hour in benefits and contributions to training programs.

The median hourly wage for all workers in Illinois is $17.71. As is often the case with the prevailing wage, the benefits of this decision will go to workers who were doing well for themselves without any special government help.

So now taxpayers will be paying even more, not just for construction, but for examining and marking out construction sites before any bricks are laid or concrete poured. Illinois doesn’t need the prevailing wage law, and it certainly doesn’t need to roll over when unions try to expand their reach.

Want more? Get stories like this delivered straight to your inbox.

Thank you, we'll keep you informed!