A Worker and Taxpayer Win: Michigan Court of Claims Upholds Prevailing Wage Repeal

Posted by Olivia Grady on Wednesday, February 27th, 2019 at 2:25 pm - Permalink

On February 25, 2019, the Michigan Court of Claims dismissed a case challenging the repeal of Michigan’s prevailing wage law by the Michigan legislature. The court rejected the argument made by the plaintiff, Protect Michigan Jobs, that appropriations can’t be made in public acts.

The case stems from the Michigan legislature voting to repeal the prevailing wage law on June 6, 2018. In the Senate, 23 Republican Senators voted to repeal the law, while 4 Republicans and 10 Democrats voted against it. The House of Representatives voted 56 to 53 with some Republicans joining Democrats to vote against the measure.

Legislators repealed the prevailing wage law because it hurt workers and taxpayers. The law required contractors of some public projects to pay union-dictated wages. These high wages made it impossible for contractors to hire low-skilled workers, and taxpayers were left to pay more for public projects. 

Senate Majority Leader Arian Meekhof (R-West Olive), who has introduced bills to repeal the prevailing wage, explained that “[p]rojects paying prevailing wages ‘cost 10-15% more than if it was built by the private sector. The time has come to eliminate this outdated law and save our taxpayers money.’”

The law did not need a signature from Governor Rick Snyder because Protecting Michigan Taxpayers, a group supporting the repeal, submitted 382,700 signatures for an initiative. The legislature then chose to vote on the repeal rather than hold an election.

Studies have shown that repealing the prevailing wage in Michigan will lead to hundreds of millions of dollars in savings for the Michigan taxpayer.

Michigan just became the 24th state without a prevailing wage. ATR and CWF urge lawmakers in other states to consider repealing their prevailing wage laws and supporting workers and taxpayers.