A substitute version of SB 5061 was adopted last week. The substitute made one small change to the bill, removing the requirement that the prevailing wage be adjusted “as needed,” and instead relying on the bill’s language that the wage paid will be the prevailing wage at the time the work is performed. While the bill is moving ahead, the fiscal note (approximately $3M per biennium) will create headwinds, given the significant constrains on the state budgets this year. SB 5061 is a priority for labor, so we expect conversations around the issue to continue as proponents look for a way forward that would minimize the significant costs to L&I outlined in the fiscal note.
The bill attempts to address the problem of laborers having their wages essentially frozen at the rate established when the contract was let. This is particularly concerning to the bill sponsor and labor organizations when projects last multiple years. AWC has engaged with the sponsor, labor partners, and our public sector peers to ensure proponents understand why it is critical that public works projects capture project costs at the outset: for budgeting purposes and to maintain transparency for the public regarding the procurement process and project costs.
AWC is partnering with public sector partners to request changes, including exempting lower cost or short duration projects from the bill scope (small works projects, for example), limiting adjustments to once a year (L&I updates the prevailing wage twice a year, as necessary), and ensuring that public entities not be obligated to automatically accept change orders as a result of the adjustments.
Date to remember
SB 5061 is scheduled for public hearing in the Senate Transportation Committee on Monday, January 24 at 1:30 pm. The bill is scheduled for executive session in the same Committee on Tuesday, February 25, at 1:30 pm.
Public works contracts to account upfront for changes in prevailing wage per new bill
January 20, 2025
Sen. Steve Conway (D–Tacoma) has introduced legislation intended to ensure that workers on public works projects are paid the prevailing rate of wage in effect at the time the work is performed.
Prevailing wages are frozen from the time bids are due for the duration of the project, regardless of how long it takes to complete the project, which can sometimes take years. This means that in some cases workers may not be paid the current prevailing wage during the time the work is performed.
SB 5061 requires that public works contracts stipulate that the wages paid to laborers, workers, or mechanics be adjusted as necessary to the prevailing rate of wage in effect at the time the work is performed.
The bill is an updated version of HB 1099 from 2023 which did not pass. View AWC’s coverage here. This year’s proposal improves upon the original by providing that changes in wage rates are largely accounted for in the contract and before the project begins. The bill does not specify if changing orders will be necessary to adjust workers wages during the project.
Please contact AWC staff if your city has concerns or other feedback on this legislation.
AWC supports the premise of paying the appropriate wages at the time of the work being done and is working to ensure that the bill’s proposed changes are implementable.
Date to remember
SB 5061 is scheduled for public hearing in the Senate Labor & Commerce Committee on January 24 at 8 am.