Shane Hernandez addresses challenges of Michigan's prevailing wage law for contractors

The Michigan Legislature's Subcommittee on Labor and Economic Opportunity convened on May 14, 2025, to address pressing concerns regarding the state's prevailing wage law, which has been in effect for over a year. Shane Hernandez, president of the Associated Builders and Contractors of Michigan, emphasized the importance of ensuring that non-union members—who represent 80% of the state's construction industry—feel secure when bidding on projects that require compliance with prevailing wage standards.

Hernandez highlighted the complexities surrounding the prevailing wage law, noting the extensive 14,150-page rate schedule that contractors must navigate. He pointed out that, despite the law's implementation, there is currently no comprehensive rule set to guide contractors in their compliance efforts. This lack of clarity has left many contractors hesitant to engage in bidding for prevailing wage jobs due to fears of potential legal repercussions and the complexities of calculating fringe benefits.

A significant concern raised during the meeting was the preregistration process for contractors, which requires them to submit sensitive personal data about their employees. Hernandez expressed worries about data privacy, particularly regarding the potential for Freedom of Information Act (FOIA) requests to expose personal information. He also raised questions about the implications of missing preregistration deadlines, which could prevent contractors from participating in future bidding opportunities.

Additionally, the issue of anonymous complaints within the prevailing wage framework was discussed. Hernandez warned that the absence of clear rules could lead to misuse of the complaint system, allowing individuals to file complaints without accountability, potentially harming contractors' reputations.

The discussions underscored the need for clearer guidelines and protections for contractors as they navigate the prevailing wage landscape. The committee's focus on these issues reflects a broader commitment to ensuring that Michigan can effectively build essential infrastructure, such as schools and roads, while maintaining a fair and competitive environment for all contractors. As the state moves forward, the outcomes of these discussions will be crucial in shaping the future of construction in Michigan.