Opinion Editorial. The Santa Fe New Mexican
September 8, 2015
NM COURT TELLS STATE TO ENFORCE WAGE LAWS
By Sen. Michael S. Sanchez
On Labor Day we pause to mark the huge contributions made by labor unions throughout America’s history — Social Security, child labor laws, the 40-hour workweek and so on. We also say thank you to all working men and women for the enormous contributions they make daily to our country.
Here in New Mexico, we have strong reason to applaud the building trades unions that carried a recent legal battle to ensure that workers are treated fairly through the enforcement of our prevailing wage laws. Our prevailing wage law opens a door to career paths for young people and better lives, delivering better productivity and economic growth. It is time leaders in our state begin to look for ways to improve the economic conditions and quality of life of workers’ families, not harm them further.
We say thanks to our state Supreme Court for its vigilance in protecting the wages and benefits of workers on public construction projects. Earlier this summer, the court justices struck down a key policy of Gov. Susana Martinez’s Workforce Solutions Department that wrongly withheld the pay of thousands of workers on road and construction projects financed with state dollars.
According to the court’s opinion, employees on public projects such as school construction and road repair were shortchanged by the state between 5 percent and 35 percent of the pay that was due them over five years. For a worker earning $43,000 annually, for example, that might mean having $14,000 cut from your income.
Using unusually strong language, the justices ordered the state to halt the practice immediately. Labor union victories are rare these days, and this one matters.
The issue centers on “prevailing wages.” New Mexico has a law on the books, like more than 20 other states, that requires construction wages and benefits paid under state contracts be no lower than locally prevailing wages and benefits for the same kind of work. Put simply, it is a minimum-wage law applicable to skilled workers on taxpayer-financed public construction projects. The prevailing wage rate is market-based, the result of collective bargaining agreements between employers and employees’ unions.
Prevailing wage laws like ours have long operated at the federal and state levels as a check against the tendency of some in the construction industry to engage in destructive wage and price competition. Such competition can drive skilled and experienced workers from the industry and the state, reduce work quality, productivity and job safety. It also can lead to race-to-the-bottom, poverty-level jobs — all without saving the taxpayers any money on their public projects.
The Martinez administration wants to repeal New Mexico’s prevailing wage law. It has been unsuccessful in doing so, however. Instead, the state Department of Workforce Solutions simply refused to comply with the law, resulting in thousands of workers on public projects being deprived of their rightful pay over the last five years.
Proponents of repeal, including a major news outlet, say it will knock down construction costs. To be sure, we all want efficiency in spending scarce state dollars on needed public projects.
But ample research reveals that prevailing wage laws do not raise costs to government. Contrary to the simplistic views of those who would have the law repealed, higher wages do not lead to higher contract costs.
The reason is simple: Higher wages produce better-trained workers who are more productive. Family-sustaining wages, health coverage and good pensions attract and retain workers. A skilled electrician, for example, with years of experience can problem-solve and do the job more quickly and right the first time. This know-how translates into lower costs due to fewer expensive errors and less need for supervisors.
Higher retention lowers recruitment and screening costs. And higher wages promote the use of labor-saving technology and management practices that keep per-square-foot costs low. Projects come in under budget, ahead of schedule, with fewer injuries and lower worker-compensation costs.
The example of states that repealed their prevailing wage laws, like Utah and Iowa, shows that repeal can have devastating effects.
According to the Economic Policy Institute, research proves that “prevailing wage laws can enhance state revenues, industry income, and non-wage benefits for workers; lower future maintenance and repair costs, reduce occupational injuries and fatalities, and increase the pool of skilled construction workers — to the benefit of both the public and the construction industry.”
The administration’s spokesman called the court’s order to start enforcing the law “a huge loss for taxpayers.” Nothing could be further from the truth.
“It’s time to protect the paychecks of New Mexico workers. It’s common sense and it’s long overdue,” Gov. Martinez declared in her State of the State address earlier this year.
I couldn’t agree more.
Sen. Michael Sanchez, D-Belen, is the majority leader of the New Mexico Senate. He represents District 29.
http://www.santafenewmexican.com/opinion/my_view/reader-view-court-tells-state-to-enforce-wage-laws/article_9ca72b92-a3a0-5649-bb41-ef335804c583.html