News Story

Right-to-Work Inches Ahead in Indiana

A dispatch from Indianapolis

INDIANAPOLIS — Legislation that would make Indiana a right-to-work state moved to the floor of the state House here Tuesday after House Bill 1001 passed the House Employment, Labor and Pensions Committee on an 8-5 party line vote, with all Democrats opposing the legislation.

A vote on the bill by the full House is planned for the end of the week.

For the House side of the Indiana General Assembly, the committee hearing Tuesday morning was a catch-up event. Movement of the legislation had been delayed three days because Democrats stayed away to prevent action on the measure by denying a required quorum of at least 67 House members being present for a session. The Republicans control the chamber by a 60-40 margin.

The Democrats, however, who were facing fines of $1,000 per day each, decided to show up for work, ending their walk-out Monday, although Indiana House Democratic Leader Patrick Bauer has said he would not rule out future walk-outs aimed at stalling the legislation.

In the very brief hearing this morning, it took little time for the Democrats and Republicans to begin arguing. Republican Committee Chair Douglas Gutwein wouldn’t allow Democrats to offer amendments to the bill. When Democrats protested, Rep. Gutwein pointed out that if they had been in session last Friday they might have had a chance to amend the bill at that time. The entire hearing today lasted less than 10 minutes. It was not a harmonious gathering.

The Indiana Senate has already moved its version of the legislation, Senate Bill 269, to the Senate floor. House Bill 1001 is the House version of the legislation. Currently, the bills are the same. If the two versions end up differing, the track the legislation takes through the General Assembly would be slowed. As written, the legislation would make it a Class A misdemeanor to require an individual to join or remain in a union or to pay any dues, fees or other charges to that same labor organization

Michiganders have good reason to keep a watch over what is happening in the Hoosier State.

In terms of economic competition, right-to-work states fare better than those that haven't adopted the policy. What's more, this tendency has become more pronounced in an increasingly global marketplace. As the first right-to-work state in the industrial Midwest, Indiana’s economy might be expected to excel beyond the economies of its neighboring states. If that were to happen, pressure could mount on Michigan lawmakers to adopt a right-to-work law.

“I don't think it would make much difference immediately,” said Inside Michigan Politics Editor Bill Ballenger. “I mean, the Michigan Legislature isn't going to turn around and pass a right-to-work law just because Indiana does. But, does it pave the way to adoption of one in the future? It certainly could. The big question would be whether the Republicans can hang on to control of the House in the fall. If they do, then you might see them moving to do something on right-to-work the next year after that, or maybe in 2015 or 2016. Once we see a neighboring state adopt it, it could start a one-step-at-a-time situation that moves in that direction.”

It's believed that there might already be enough votes in the Michigan Legislature to pass such a measure. Meanwhile, Gov. Rick Snyder has said that he won't pursue RTW for Michigan as part of his agenda, but would sign an RTW bill if it reached his desk.

 

Michigan Capitol Confidential is the news source produced by the Mackinac Center for Public Policy. Michigan Capitol Confidential reports with a free-market news perspective.

Commentary

Bay City Amends Prevailing Wage Ordinance

Right-to-work legislation has been introduced in Indiana and may actually win Gov. Mitch Daniels’ signature by the time Super Bowl Sunday arrives on Feb. 5. The Great Lake State may need to follow suit to compete economically.

Before it does, however, the people of Michigan should note that one city — Bay City —leapt headlong into the labor fray Monday night. Its city commission voted to amend the city’s prevailing wage ordinance to exempt contracts under $100,000 in value. The previous threshold was only $10,000. It also — quite significantly — eliminates the prevailing wage mandate when Bay City shares projects with cities that do not have a similar ordinance, such as Midland. The change requires a second confirming vote which will be made at the next city commission meeting this month.

A prevailing wage law mandates that union-scale wages be paid on construction work funded by taxpayer dollars, irrespective of the winning bidder. Federal, state and local prevailing wage laws can exist simultaneously. Statewide there are at least 15 such laws if you count the influence of federal and state statutes as well as such laws passed by local units of government.

To our knowledge, no unit of government in Michigan has ever completely repealed its prevailing wage ordinance, but this may be a first step. The state of Michigan, Bay City and other cities should do so.

Jimmy Greene, CEO and president of the Associated Builders and Contractors of Greater Michigan, said that “The ABC is excited about Bay City’s step in the right direction by making a decision to change the way it does construction business. It clearly demonstrates that it is open for business, safeguarding tax dollars without compromising quality, safety and the local influence of work.”

Mackinac Center analysts have calculated that if Michigan repealed its prevailing wage law, taxpayers could save at least $200 million annually. Bay City government is likely to save its taxpayers money, too, and so could every other Michigan municipality operating under this archaic practice if they were all repealed.

Paul Kersey, director of labor policy, provided public comments at the meeting, arguing that prevailing wages laws are ultimately just pay offs to union contractors.

 

Michigan Capitol Confidential is the news source produced by the Mackinac Center for Public Policy. Michigan Capitol Confidential reports with a free-market news perspective.