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Gov. Gretchen Whitmer touted the bills, opposed by business groups, as a defense of workers’ rights. Gov. Gretchen Whitmer touted the bills, opposed by business groups, as a defense of workers’ rights. Credit: Governor’s office

Whitmer signs repeal of right-to-work law, reinstatement of prevailing wage

BY Crain’s Detroit Business Friday, March 24, 2023 03:14pm

Michigan Gov. Gretchen Whitmer has signed into law bills repealing the state’s “right-to-work” law and reinstating a law that requires higher wages and benefits to be paid on state-financed construction projects.

The action reverses moves that Republicans made in 2012 and 2018 and had been a priority for Democrats after they took control of the Legislature in the 2022 election.

The bills were approved earlier this month on 56-52 and 20-16 party-line votes. The legislation, which sailed through the House and Senate within weeks, has been applauded by organized labor. Business and conservative groups have criticized the bills, which will take effect in March 2024.

“Today, we are coming together to restore workers’ rights, protect Michiganders on the job, and grow Michigan’s middle class,” Whitmer said in a statement.

The bills included $1 million in appropriations that critics said were inserted to make them “referendum-proof.” Whitmer had promised in 2019 not to sign bills that contained appropriations for that purpose.

The “right-to-work” repeal will enable private-sector unions to again negotiate contracts requiring union-represented workers to join or financially support the union, after a decade-long prohibition. Public-sector unions, however, will not be affected by the repeal because the U.S. Supreme Court in 2018 ruled that government employees who are represented by unions but do not pay dues cannot be required to pay agency fees to cover unions’ costs to negotiate contracts.

The “right-to-work” law, which took effect in 2013, was a blow for unions in what is considered the birthplace of the American labor movement.

In 2022, 589,000, or 14 percent, of Michigan workers were union members — down from 629,000, or 16.6 percent, in 2012, according to the U.S. Bureau of Labor Statistics. The Midland-based Mackinac Center for Public Policy, which favors the law, has analyzed what it says are more precise, federally required union reports and state Civil Service Commission data to estimate that at least 140,000 people have opted out of union membership since the law was enacted even though most affected industries saw steady or growing employment.

The Mackinac Center criticized the move as making Michigan less competitive.

“Gov. Whitmer and Democratic lawmakers have just committed a massive, unforced error that weakens Michigan’s ability to compete globally and signals to the world that there are better places than Michigan to live, work, invest, and create jobs,” the free-market think tank said in a statement. “Compelling support for organized labor does directly and immediately harm tens of thousands who will now be fired if they choose not to support a union. Union coercion is a backward business model, doomed to failure.”

The prevailing wage bill would mandate higher wages and benefits on state-funded buildings, schools, public works projects, roads and bridges. Covered workers would include those doing manual labor but not executive, administrative, professional, office or custodial employees.

Better wages already are mandated on many road and bridge projects because of a federal prevailing wage law. And a year ago, Whitmer’s administration began to require state contractors and subcontractors to pay prevailing wages on construction-based contracts issued by the Michigan Department of Technology, Management & Budget. The change was applied to contracts worth more than $50,000.

From Crain’s Detroit Business.

Read 1830 times Last modified on Sunday, 26 March 2023 20:10