Michigan’s prevailing wage laws are primarily governed by the Michigan Prevailing Wage Act (Act 10 of 2023). This legislation mandates that contractors on state-funded projects pay wages and benefits comparable to union-level rates for similar work in the project’s locality. This law safeguards fair compensation and prevents undercutting labor costs, similar to the federal Davis-Bacon Act, which applies to federally funded projects. 

Michigan’s prevailing wage laws cover state-funded construction projects with a minimum contract value of $50,000. This threshold applies to new construction, repair, and maintenance work, ensuring that substantial public investments reflect fair labor standards.

Exceptions may apply to certain projects or funding sources, depending on specific provisions within the law.

What are the benefits of prevailing wage? 

Prevailing wage laws keep construction costs stable while benefiting construction workers and local communities.

The most comprehensive studies have found no impact on public construction costs while also finding that prevailing wage laws have the following positive economic impacts: 

• Local contractors are more likely to win bids on local construction projects.
• Increases annual incomes for all construction workers by 5.2%.
• Expands health insurance coverage for construction workers by 5%.
• Reduces construction worker reliance on food stamps by 2.1%.
• Prevailing Wage results in increased participation in Registered Apprenticeship