This legislation would broaden the scope of prevailing wage requirements for service employees and create criminal penalties for violations.
This legislation alters existing labor law provisions that were created to establish wage requirements for building service employees to apply to broad new categories of employees including service work for utility companies, and numerous other categories not contemplated by the drafters of the original legislation. In fact, service work for utility companies was explicitly and intentionally excluded from the original legislation in recognition that the extension of wage requirements to such workers would be inappropriate and result in increased cost to the ratepayers. Estimates from just three of the State's utility companies are that the added costs to ratepayers would exceed $37 million annually. There is no rationale offered by the sponsors to support expanding prevailing wage mandates to the private sector for non-public works.
New York has some of the highest energy prices in the nation, and a report was issued by the Public Policy Institute in March of 2010 showing that state and local government taxes make up more than a quarter of New York electric bills. New York's power industry paid an estimated $6.367 billion in state and local taxes, assessments and fees in 2009. The figure is $853 million higher than the total the industry paid in 2008, an increase of more than 15% in just one calendar year.
The imposition of wage mandates on these industries, already struggling with additional costs imposed by the State, including the 18-a surcharge in the 2009-2010 Executive Budget, the MTA payroll tax in the MTA region, and the proposed expansion of the local gross receipts tax, is ill-timed and will only further burden both the employers and the consumers.
For the foregoing reasons, The Business Council opposes this legislation and urges that it be held in committee.