by Ryan R. Morton (Spring 2019)

When Governor J.B. Pritzker took office in mid-January, the first bill he signed made significant changes to the Illinois Prevailing Wage Act (820 ILCS 130/0.01 et seq.), a statute his predecessor tried to repeal in its entirety. The amendment gives the State more control over how much local governments should pay contractors by eliminating the option of setting local rates.

The IPWA requires local governments to pay their contractors or subcontractors “the general prevailing hourly rate as paid for work of a similar character in the locality in which the work is performed.” (820 ILCS 130/1) In years past, a public body could ascertain for itself the prevailing rate “for each craft or type of worker or mechanic needed” in the county. (820 ILCS 130/4 (until June 1, 2019)) Alternatively, the public body could simply adhere to the prevailing wages determined by the Illinois Department of Labor for each county and trade.

Under the amended Section 4 of the IPWA, prevailing wage rates will now be determined solely by IDOL. Local governments no longer have the option of calculating their own prevailing wage rates.      The rates currently on IDOL’s website were updated April 5, 2019, reflecting data submitted by trade unions. Any objections to the rate must be filed within 30 days.

The Governor’s office touted other changes to the IPWA. The new version tasks the Illinois Department of Labor with releasing regular reports on worker diversity in public projects. IDOL also must provide recommendations on how to increase the employment of women and people of color on those projects.

Although this amendment creates another mandate from the state, many local elected officials have voiced support for the change. Few units of local government actually performed the detailed investigation needed to determine prevailing rates due to the high cost and time required of such a project. Instead, most municipalities, schools, fire districts, and other entities simply chose to adopt the state’s prevailing wages.          Practically speaking, then, the biggest change is that ordinances will not have to be drafted and voted upon every June, which means the amendment actually reduces the burden on local governments.

Remember that all pre-existing requirements of the IPWA are still in effect. Therefore, although a public body no longer needs an attorney to draft the annual prevailing wage ordinance, be sure to consult with your legal counsel when bidding projects and hiring contractors, to ensure compliance with those other provisions.

For questions on prevailing wages, bidding projects, and hiring contractors contact an attorney at Ottosen Britz.