Last week the state House approved a bill extending the standard wage to certain private-sector contractors doing business with the state. HB-6502, which sets up a new method for determining standard hourly wages and benefits, is yet another proposal that will only discourage economic growth and innovation.
Specifically, private-contractor maintenance workers would have to receive the same standard wage and benefits as employees working under the union agreement covering the same type of work for the largest number of hourly nonsupervisory employees in Hartford County.
If there is no private -sector union contract for at least 500 employees in Hartford County who are doing the same work, then the wage rate determination in the current standard wage law would apply. That means the Department of Labor would set the hourly rate for all job classes based on those identified in the Federal Register of Wage Determinations, plus a 30% surcharge to represent the cost of health and retirement benefits.
Thus, the employer would have to either provide benefits equal to the 30% surcharge or pay the employees an additional 30%.
At a time when state residents are looking to state government to become more efficient and less costly, HB-6502 is a proposal that would make state projects more expensive. It’s also a great reason for private businesses to avoid doing business with the state.
Connecticut is competing in a global economy for jobs and economic growth. Now more than ever, Connecticut needs all of the advantages it can get. Extending the standard wage to certain private-sector contracts will harm Connecticut’s overall economic competitiveness. If enacted, HB 6502 will increase employer costs and will certainly jeopardize the ability of smaller businesses to participate in state projects.
For more information, contact CBIA’s Kia Murrell at 860-244-1931 or email@example.com.