AGC testifies on a flurry of labor bills

AGC opposes bills to increase apprentice utilization mandate paid vacation leave and mandate certified payrolls on public projects and supports bills to clarify independent contractor rules.

Apprentice Utilization
HB 2526 would make any bidder “non-responsible” that does not meet apprenticeship utilization requirements. Additionally this bill would give a five percent bid preference to any contractor that employs a “trade” which has a registered apprenticeship program. “The bill’s enforcement provisions regarding apprenticeship utilization goals are excessive and unfair against general contractors” AGC Chief Lobbyist and General Council Van Collins told the House Labor and Workforce Development Committee in a hearing last week. The bill prevents a general contractor from being able to bit on any future public works project for a single instance of not meeting an apprenticeship utilization goal – and it punishes only general contractors for non-compliance even though subcontractors provide many or most of the apprenticeship labor hours. “A five-percent bid preference will necessarily increase costs” Collins added. “It is clearly anti-competitive and will reduce the overall bid pool.”

Paid Vacation Leave
HB 2238 would require mandatory paid vacation leave statewide. It would accrue beginning with 40 hours after one year of employment and increase thereafter until 120 hours would accrue after five years of employment. Part time employees would accrue leave pro rata. “This bill is not needed when it comes to construction” Collins told the Committee. “The entire industry has been formed on the concept that workers are already compensated with higher wages to offset such benefits as vacation leave. Plus the bill creates unfair outcomes. The bill allows signatory contractors to specifically negotiate a waiver to the bill’s application. Open shop contractors will not have the luxury of that same benefit. AGC fails to see how this is fair or equitable.”

Certified Payrolls
HB 2331 bill would mandate certified payrolls on all public works projects. Certified payrolls would have to be delivered to a public owner by the general contractor and all subcontractors before any payment progress or final is made to the general contractor.
“It makes no sense to have certified payrolls on top of the current system of statements of intent” Collins testified. “The bill greatly complicates progress payments release of retainage and project closeout.”

Independent Contractors
HB 2334 would redefine who is an employee and who is an independent contractor. HB 2147 would provide a clear method for persons to declare themselves as independent contractors rather than employees. This would be done by registration process through Labor & Industries. HB 2258 would also provide a clear method for persons to declare themselves as independent contractors rather than employees. This would be done merely by holding a valid contractor’s registration along with all proper registrations with Employment Security Department of Revenue etc.
“HB 2334 essentially makes most everyone an employee regardless of the desires or manifest intent of the parties involved” Collins told the Committee. “And while the bill ostensibly addresses concerns surrounding general contractors I can assure you it does not. The bill’s provision that an employee can be employed by more than one employer at a time is entirely problematic in construction.”

AGC opposes HB 2334 but supports HB 2147 and HB 2258. “AGC supports the policy which underlies both of these bills” Collins said. “These bills provide clarity and honor the intent of the parties involved. We understand that education or other protections might be warranted but an objective bright-line standard would be beneficial.”

For more information contact Van Collins 360.352.5000.