You may have seen the article regarding a landscape company in Mequon that was indicted for failing to pay prevailing wage. You may have thought, “Wait! I thought that prevailing wage was over in Wisconsin.”
Not so fast.
All public and state projects remain subject to the daily and weekly limits. This article provides an overview of both the changes to Wisconsin’s prevailing wage law and issues relating to state highway projects, including when truckers are subject to prevailing wage and hour requirements.
New Requirements in Effect Jan. 1
Effective Jan. 1, 2017, prevailing wage requirements in Wisconsin have changed. For local government projects (towns, villages, cities, schools, and sewer districts) wage rate requirements were repealed pursuant to 2015 Wisconsin Act 55. The Act left in place daily and weekly hour limits (before 1.5 rates apply) in all sectors of public contracting including local government.
Carrie Cox, Marquette 1998, is assistant general counsel with the Wisconsin Department of Transportation, Madison, where she concentrates her practice on transportation issues including, construction, contracting, eminent domain, utilities, and regulatory compliance.
Prevailing wage rate requirements remain in place for all state agency and state highway projects, and for any project using federal dollars.
When Prevailing Wage Rates Are Required
Prevailing wage rates are not required for single-trade projects with an estimated cost to complete of less than $48,000, and for multiple-trade projects with estimated costs to complete of less than $100,000. This is true of both state agency and state highway projects.
For projects that began before the start of 2017, prevailing wage requirements are governed by the prior law through the end of the project: Wis. Stat. section 66.0903 for local projects, Wis. Stat. section 103.49 for state projects, and Wis. Stat. section 103.50 for state highway projects.
Rates Now Calculated from Federal Rates
Another significant change to the prevailing wage law is that there is no longer a state and federal calculation of wage rates. All wage rates are now calculated from the federal rates issued by the U.S. Department of Labor pursuant to the Davis-Bacon Act, 40 U.S.C. 3142. Although rates may still vary county to county, using federal rates should alleviate some of the burden of managing a project subject to prevailing wage rates.
Where federal dollars are part of a highway project and Davis-Bacon applies outright, the state can apply prevailing wage to workers even where Davis-Bacon does not. This was decided in the federal Seventh Circuit in a case where the contractor believed that Wisconsin’s prevailing wage law should not apply if Davis-Bacon did not apply to that worker.
Seventh Circuit: Check to See if Wisconsin Law Applies
The court determined that, even where federal funds are in play and no requirement for application of prevailing wage exists under federal requirements, the state could apply prevailing wage requirements. It was determined that doing so does not conflict with federal aid highway and Davis-Bacon Acts.
In other words, federal law will not pre-empt Wisconsin law on this point. Frank Bros., Inc. v. Wisconsin Department of Transportation, 297 F.Supp 2d 1140, 1147, W.D. WI 2003.
The caution here is this: even where federal law doesn’t require application of prevailing wage, check to make sure whether Wisconsin law does.