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The Effects of the Exemption of School Construction Projects from Ohio’s Prevailing Wage Law

May 20, 2002
By Ohio Legislative Service Commission

The nation's first prevailing wage law was passed in Kansas in 1891. The federal prevailing wage law, the Davis-Bacon Act, was passed in 1931, the same year in which Ohio's prevailing wage law was enacted.

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The nation's first prevailing wage law was passed in Kansas in 1891. The federal prevailing wage law, the Davis-Bacon Act, was passed in 1931, the same year in which Ohio's prevailing wage law was enacted. These laws, and similar ones in other states, require that workers on government sponsored construction projects be paid "prevailing wages."

In Ohio, prevailing wages are based on collective bargaining agreements. Prevailing wages are union wages. If there is no collective bargaining agreement in the immediate locality in which construction is taking place, then the prevailing rates of wages in the nearest locality in which a collective bargaining agreement is in effect is used. In addition to wages being set by union collective bargaining agreements, contractors are subject to work rules (such as apprentice to skilled worker ratio) contained in the collective bargaining agreement used to determine the prevailing wage.

The stated intent of prevailing wage laws is to protect local wage rates in the construction industry. Many historians have argued that during the Great Depression, these wages needed protection from itinerant contractors using lower wage labor and from the monopsony (single buyer) power of governments. The continued need for these laws is subject to great debate.