In April, New York City Mayor Michael Bloomberg decided to change the pay structure for roughly 10,000 municipal workers, most of whom were skilled tradesmen. The move lowered wages for new hires and broke away from 100 years of tradition wherein the City Comptroller set wages for these workers according to the prevailing wage. On Thursday, a judge ruled that Bloomberg exceeded his authority in doing so. Unions are declaring the decision a victory while the Bloomberg administration is looking to appeal the decision.
“We’re very pleased the judge agreed that the city overreached by stripping workers of prevailing wage protections,” said Vincent Alvarez, president of the city Central Labor Council, which supported the lawsuit. “It was an inappropriate action from the get-go, and would have hurt thousands of workers and their families.”
State Supreme Court Justice Manuel Mendez said Bloomberg’s decision “didn’t have a rational basis,” is “arbitrary and capricious,” and occurred without notice or a hearing by the state Civil Service Commission. It is difficult to argue that the move accomplished anything other than lowering the wages of the city’s skilled tradesman:
The judge’s ruling affects about 10,000, or about 3 percent, of the city’s employees, most of them skilled tradesmen such as carpenters, blacksmiths and plumbers.
The mayor had criticized as a “back-door political thing” the old practice of setting the workers’ pay and time off through negotiations with the comptroller.
Michael Loughran, spokesman for city Comptroller John Liu, said, “This office has set prevailing wages for more than a century and the mayor’s current labor strategy has resulted in 200,000 men and women working without a contract.”
Bloomberg’s supporters have attempted to spin one of the oldest prevailing wage laws in the nation as an outdated regulation.
New York State passed one of the nation’s first prevailing wage laws in 1894, mandating that all state funded construction jobs be built by workers receiving prevailing wages. The US government passed its prevailing wage law, the Davis Bacon Act, in 1930. Many state and local authorities enacted their own “little Davis Bacon laws” shortly thereafter.
On the blog Gangbox, writer Gregory Butler gives an example of how prevailing wages affect carpenters in NYC. This case is not specific to Bloomberg’s decision but it shows the negative impact that undermining the prevailing wage can have:
In the case of this writer’s craft, carpenters, the union scale and prevailing wage for New York City is $46.15/hr (plus benefits). The wage scale paid for carpenters on scab jobs, by contrast, ranges from a high of $25 an hour (and no benefits) on scab commercial jobs to as little as $7 an hour (often paid off the books – with no benefits, of course, not even unemployment or social security) on certain scab jobs.
In particular, the contractors employed by the members of the NYS Association for Affordable Housing are often those on the $7/hr off the books end of the compensation scale.
Yes, that is very blatantly illegal, since the state and federal minimum wage is $ 7.25/hr.
Unions have been fighting the Mayor’s wage shake up since its inception.
Unions vigorously opposed the mayor’s order. The New York District Council of Carpenters, District Council 37, Plumbers Local 1, Steamfitters Local 638 and Local 3 of the International Brotherhood of Electrical Workers were among those who went to court seeking a restraining order, which was granted in May.
The city’s actions were a transparent power grab that would have had a detrimental impact on middle class workers,” said Mario Cilento, president of the state AFL-CIO.
The office of Comptroller John Liu, which currently regulates wages for these positions according to prevailing wage laws, unsurprisingly agreed with the court’s decision:
“This office has set prevailing wages for more than a century,” crowed comptroller’s office spokesman Michael Loughran.
“We fully agree with the court’s decision in this case and hope that City Hall will focus on the real issues affecting our city, such as unemployment, the growing wealth gap, and restructuring the Economic Development Corporation to benefit all New Yorkers, not just corporate interests.”