By Tom Lampman

Summary

Ohio’s “prevailing wage” law artificially inflates labor costs on public works construction projects and is a costly obstacle to economic growth and effective governance. The law should be repealed or reformed to stop special interest groups from lining their pockets at the taxpayers’ expense. If the law cannot be repealed, the inaccurate and unfair process used to calculate the “prevailing wage” must be reformed.

When state and local government agencies begin a construction project, Ohio’s Department of Commerce first determines the so-called “prevailing wage” for each type of labor that the project will need.[1] Unfortunately, this wage is determined by local union contracts and collective bargaining agreements in the vicinity of the project.[2] For example, the Department has determined total value of wages and union retirement fund contributions for Franklin County roofers comes to $39.05 per hour.[3] Therefore, any contractor bidding on a project in Franklin County must bid according to the union-dictated wage schedule, even if their workers are not unionized or paid $39.05 per hour.[4] This type of artificial wage setting increases public construction costs for taxpayers, and reduces competition and the competitive advantage of non-union employers.

Click here to download the full report: Repairing Ohio’s Prevailing Wage Law

1. Ohio Rev. Code Ann. §4115.04.

2. Ohio Rev. Code Ann. §4115.05.

3. Ohio Department of Commerce, “Prevailing Wage Rates,” Bureau of Wage and Hour Administration, accessed August 1, 2015, http://198.234.41.198/w3/webwh.nsf/wrview

4. Ohio Rev. Code Ann. §4115.03.