An interesting agreement occurred in April of this year when the Road building contractors in Michigan agreed to require union and non-union subcontractors to pay into a union fringe benefit fund in which their non-union peers are barred from receiving.

Does that sound fair to you?

The amount that these subcontractors would have to pay into the fund and receive nothing from it is astounding.  These non-union subcontractors would be required to pay about $29 per hour per worker of their wages into this Union trust fund which is used for union pensions, health care and training. This will dramatically drive up costs for us taxpayers.

According to an op-ed published in the Detroit News there is a pothole which these union contracts could run into.  Republican members of the Michigan legislature are now attempting to use the Michigan budget as a “tool” to ensure a better deal for Michigan taxpayers.

According to wording in the Michigan House transportation budget Section 327, Section 327 would “bar the Michigan Department of Transportation from giving bids to contractors that require their subcontractors to pay into the same union fringe benefits as the general contractor, even if those subcontractors are non-union”.

Section 327 wording was put into the budget because Republican lawmakers are looking to protect non-union subcontractors and other workers from unfair demands. More importantly it would also protect Michigan taxpayers from increasing the cost of these expensive road project.

Jeff Wiggins, the state director of Associated Builders and Contractors, which represents nonunion contractors and is supporting the budget maneuver stated:

The state cannot be paying into road projects where some workers pay for pension funds they don't get

There could be a problem with the wording in Section 327 because it could literally disqualify a large majority of Michigan’s largest road builders from receiving road project bids.  If this was to occur it could potentially delaying the needed road work from being completed in a timely matter.

Dan McKernan, a spokesman for Operating Engineers 324 stated that if the wording in Section 327 passes and is signed by Governor Whitmer, then 80 to 90% of the contractors who have completed road projects in the past five years would be barred from receiving bids.

That certainly sounds like a problem to me.

The question I have is if the Unions demand that non-union workers who would have no access to the pension and health benefits that they would be required to pay into is actually extortion.

What are your thoughts about that?

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