Indiana Senate Committee Passes Repeal of Construction Wage Law

April 8, 2015

Senate Tax and Fiscal Policy Committee members voted 8-5 in favor of eliminating the five-member boards that set the Indiana common construction wage law.

Under the commons construction wage law, contractors must pay workers the set salary on state and local government buildings that cost more than $350,000.

Committee Chairman Brandt Hershman, R-Lafayette, said hours of testimony last week proved to him that the current wage system is broken, with boards setting varying wage rates that appeared to be driven by political considerations rather than actual wages within the communities, the Associated Press reports.

Supporters of the repeal say it could save an estimated 10 percent to 20 percent on state construction projects by allowing more contractors to pay less than union-scale wages. Critics say those numbers are not necessarily reflective of how much Indiana taxpayers will save.

Proposed changes include establishing a mandatory E-Verify program to ensure all workers are U.S. citizens, prohibiting businesses from paying workers in cash and requiring contractors to implement an employee training program.

House members in February voted 55-41 to advance the proposal, which now goes to the full Senate for consideration.

Source: News-Sentinel