SENATE BILL REPORT

SB 6732

BYSenator Cantu

Defining public works sites.

Senate Committee on Economic Development & Labor

Senate Hearing Date(s):January 30, 1990; February 2, 1990

Majority Report:     Do pass.

     Signed by Senators Lee, Chairman; Anderson, Vice Chairman; McDonald, Matson, Saling, West.

Senate Staff:Jonathan Seib (786-7427)

                February 7, 1990

AS REPORTED BY COMMITTEE ON ECONOMIC DEVELOPMENT & LABOR, FEBRUARY 2, 1990

BACKGROUND:

Current law requires employers to pay their workers no less than the prevailing wage "upon all public works."  In January 1988, the state Supreme Court construed this language to require the payment of prevailing wages by off-site manufacturers producing nonstandard items specifically for a public works project.  The applicable wage rate is that for the community where the off-site plant is located. 

The court decision, it is argued, has hindered the ability of some manufacturers to compete in supplying public works projects.  Manufacturers in high wage counties are at a disadvantage when bidding against manufacturers in counties where the established prevailing rate is low.  All in-state manufacturers are at a disadvantage when bidding against those from out of state, where no prevailing rate is established.

The Department of Labor and Industries had proposed administrative rules regarding prevailing wage and workers producing or delivering sand, gravel or other similar materials.  In general, they provided that (1) employees of those working on a public works site are covered if they are engaged in the production or transportation of materials for that site; (2) workers, regardless of their employer, are covered if their work includes incorporating these materials into a public works project or if they work in a production facility established for the purpose of supplying materials to the project; and (3) employees of established material suppliers or trucking companies who simply produce or deliver materials are not covered.  The department has withdrawn those rules and is in the process of developing new ones.

SUMMARY:

Only those employed directly on the site of public works must be paid the prevailing wage.

Permanent home offices, branch plant establishments, fabrication plants, batch plants, borrow pits, job headquarters and tool yards of a commercial supplier or materialman, which are established by a supplier of materials for a public work before opening of bids and are not on the public work site, are not "sites of public works."

Employees of commercial suppliers or materialmen employed to deliver materials to a public work site are not "employed directly on the site of a public work."

Reference in public works contract specifications to persons other than contractors or subcontractors as those who must pay the prevailing wage is removed.

Appropriation:  none

Revenue:   none

Fiscal Note:    available

Senate Committee - Testified:   Bill Mammett, Superior Asphalt and Concrete; Ira Fell, Guy F.Atkinson Construction Co.; Roy Bettesworth, WACA; Pete Paup, AGC of WA; Bob Dilger, Washington Building and Construction Trades Council; Jerry Kinsley, NW Sheet Metal Workers; Peter Coates, Teamsters 174; Leo Sweeney, Teamsters 174