When I moved to Nashville in 2006, I was sworn into the Tennessee bar by a local judge.  My partner happened to be in trial on a significant prevailing wage dispute, and the court a break during the trial to admit me to the practice of law in Tennessee.  Five minutes later, the parties returned to their week-long trial on the wage determination claims.

Fast forward seven years and a new bill is being sent to Governor Bill Haslam’s desk that essentially repeals Tennessee’s Prevailing Wage Act. Generally, present law requires that the prevailing wage rate, as determined by the prevailing wage commission, be paid to workers on all state construction projects, which are projects that are: (1) over $50,000 for any type of building and construction work for which state funds may be appropriated or expended; or (2) for construction work on any streets, highways or bridges.

HB-0850, which was signed by the House and Senate on April 15, 2013 and sent to the Governor for approval on April 16, 2013, revises the current law as follows:

  • Eliminates the state mandate of specified wages on state building projects;
  • Eliminates the mandatory certified payrolls and other paperwork submitted to the State of Tennessee on those projects;
  • For projects other than highway construction, "no such contract may require the private employer to pay wages that exceed the Tennessee Occupational Wages Report" 

The bill, as amended, does not impact highway (TDOT) projects. This is due to the Federal mandate of requiring a specified wage rate on road work. If a state does not have a mandated state Prevailing Wage, then the Davis-Bacon rate would be adopted for the wages for workers on the highway project.

This bill comes on the heels of HB-0501, which became law on April 16, 2013, that prohibits local governments from mandating health insurance benefits, leave policies, hourly wage standards or prevailing wage standards that deviate from state statutorily imposed standards on private employers as either a condition of operating a business within the jurisdictional boundaries of the local government or when the local government contracts with a private employer.

Image: USDAgov