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Nov
2016
18

Red Bluegrass: Prevailing Wage Repeal, “Right-to-Work” Increasingly Likely in KY Following Election

"I'm...not exactly labor's favorite guy right now."

“I’m…not exactly labor’s favorite guy right now.”


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The grass may still be blue, but Kentucky is looking redder than ever.

For the first time in 95 years, Republicans will outnumber Democrats in the Kentucky House of Representatives. That gives them control of the entire state legislature. In a
guest post for Insider Louisville
, Kentucky Chamber of Commerce President and CEO Dave Adkisson laid out some pretty ambitious plans for the coming legislative session, and it doesn’t look good for organized labor.

First, he wants to make Kentucky the nation’s 27th right-to-work state:

It’s time to make Kentucky a right-to work state and allow employees to make a personal decision on whether to pay dues to a union…Kentucky is the only Southern state not to have enacted right-to-work legislation. With Indiana, Michigan (that’s right, Michigan) and West Virginia’s new right-to-work laws, our state stands out as a conspicuous outlier in this much-needed area of reform.

This despite overwhelming evidence that right-to-work is directly responsible for lowering wages in other states:

Families living in Right to Work states have, on average, a median household income that is $6,568 less than their counterparts….If you compare three states with union membership below 4 percent, North Carolina, Georgia and South Carolina, their average hourly wages are $15.16, $14.45 and $15.25 respectively. Now put them next to three states with union membership above 20 percent, New York, Alaska and Hawaii. Their average hourly wages: $19.02, $20.65 and $17.44.

It’s argued that RTW laws will help bring an explosion of new jobs to a state, but the numbers don’t hold up to scrutiny. Currently, seven of the 11 states with the highest rates of unemployment have RTW laws in place.

Adkisson doesn’t stop there. He also says he wants to eliminate the prevailing wage:

It is also time for Kentucky to repeal its prevailing wage law…Added spending on public works projects by Kentucky taxpayers means fewer public works projects are built or existing projects, such as schools, are scaled back. Further, spending on higher cost public works projects means less money to shore up Kentucky’s ailing pension system, a problem that national credit agencies are watching closely, and less money for education and economic development programs.

It was been well documented that prevailing wage laws have no such effect. Adkisson’s claims are based on disproven logic:

Kentucky already tried exempting school construction from the prevailing wage, from 1982 to 1996. Londrigan said the legislature reversed itself in 1996 because the school districts gained no cost savings, and in fact, “just three or four” major contractors came to dominate school construction statewide once they could hire cheaper, less-skilled workers.

[A Kentucky Legislative Research Commission] report said several studies “have concluded that prevailing wage has no statistically significant effect on construction cost.”

The irony? When neighboring Indiana repealed its prevailing wage, Kentucky experienced a tangible benefit. Adkisson is ready to kiss that goodbye.

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