Prevailing Wage System Needs Fixing

Nevada leads the country in unemployment, foreclosures and bankruptcies.  It also tops the list for having some of the highest prevailing wages in the country.

Prevailing Wage is a system governed by the Labor Commission that establishes the compensation for employees working on government projects. The Labor Commission annually surveys contractors in each county to determine what the prevailing wage for each job will be. Under the current law, contractors can include in their estimates to the Labor Commission, pensions, health and welfare, vacation and holiday pay, the cost of apprenticeship training and additional benefits. As a result, public employees working on government projects frequently receive twice the compensation as they would on private projects.

Republican lawmakers are trying to fix the flawed prevailing wage system with A.B. 312.  The passage of A.B. 312 would implement sound economic policy, allowing competitive bidding for government projects. It also removes the surveyed contractors ability to include any potential future benefits in their estimated wage.

Assemblyman Cresent Hardy, R-Mesquite, is leading the charge on revising prevailing wage and is the main sponsors of A.B. 312. “Our economy in Nevada is suffering,” said Assemblyman Hardy. “The unchecked prevailing wage system is a significant contributor to our budget woes.  We cannot afford to pay inflated labor wages for government projects while the rest of the state and its employees are tightening their financial belts,” said Hardy.

The current prevailing wage system is having a negative effect on Nevada’s economy, specifically the construction industry. “Inflated prevailing wages results in fewer construction projects, fewer jobs, higher unemployment and more people relying on tax funded benefit programs,” said Hardy “Prevailing wage is about government accountability. As lawmakers, we need to be better stewards of the resources we have and look for ways to put more Nevada’s back to work,” said Hardy

A.B 312 was referred to the Assembly Ways and Means committee on April 18.  No action has been taken.

While Republican lawmakers examine ways to do more with less, Democrat lawmakers continue to call for a $1.2 billion tax increase.