Proposed Law Would Allow For Prevailing Wage Exemptions

february 10, 2015

On February 6, 2015, Representative Brian W. Stewart (R-Freeport) filed HB 1525 that would amend the Prevailing Wage Act by allowing a waiver of prevailing wage rates for projects of $20,000 or less. You can view the full text of HB 1525 here.

The proposed amendment provides an exemption for projects of $20,000 or less that are stand-alone projects (meaning there is no additional work in on that project in the following 24 months). The public body using the exemption must notify the Department of Labor for each project within 60 days of commencing the project. As part of the notification, the public body is required to provide a description of the project, the number of employees engaged in the project and the total cost of the project without and with the prevailing wage rate standards. A public body's ability to use the waiver is limited by federal law, in that the waiver could not be used to avoid prevailing wage under Davis-Bacon.

The bill also requires the Department of Labor submit an annual report to the Governor and General Assembly detailing the number of projects using the waiver, the number of employees engaged in the projects and the cost of the project with and without the prevailing wage rate standards.

The attorneys in the Heyl Royster's Governmental Practice frequently counsel clients on the Prevailing Wage Act and the prevailing wage requirements within the Illinois Procurement Code. We will continue to track and report on the status of this bill. If your entity has questions about the potential affect that HB 1525 may have on upcoming construction projects, please contact any of the attorneys in our Government Practice Group.