Clearing up Right-to-Work Confusion

On Aug. 28, Missouri’s new right-to-work law, signed by Governor Greitens earlier this year, goes into effect across the state, making Missouri one of 28 states with such a law. The new change has spurred many questions and concerns among IEC’s employees and partners, and the law is often fraught with confusion and misinformation. Nilson Goes, chief of operations, addresses the issue in this month’s blog to help explain how the new legislation may impact the company and the Kansas City region.

So, what is “right to work”?

Basically, the new law says an employee doesn’t need to join or pay into a union as part of employment.

Is that related at all to “prevailing wage”?

The state’s Prevailing Wage Law sets a minimum rate that must be paid to anyone working on a public works project (e.g., bridges, roads, government buildings, etc.) in Missouri. While it differs by county and the type of work, it applies to all projects commissioned by state and local entities.

What’s the big deal with right-to-work?

First, states that are right-to-work typically have a weaker union presence. In other words, the market share of union companies is typically lower than that of non-union companies, and union membership is lower. Second, these states don’t usually have as many wage requirements (such as the Prevailing Wage Law) on projects. So, companies that pay union labor rates, which are typically prevailing wage, have a tougher time competing against non-union companies.

Why would someone want to support legislation like this?

That’s a harder question to answer. Most businesses and Republican politicians support right-to-work legislation because they believe it creates an environment where employees can choose whether they want to be in a union or pay dues, and that it lowers the cost to do business in the state—thus creating more competition and business for the state. There are two sides to the issue, of course, as some believe that right-to-work legislation has a tendency to push down or stagnate wages.

How does the new law affect IEC?

The full effects of right-to-work remain to be seen. All the nuances won’t likely be seen for years, and comparing the effects of prevailing-wage projects to those projects with no wage requirements is complicated. Usually, if a project has tax dollars associated with it, it must be considered “prevailing wage,” which creates an even playing field for all those competing on these projects. If and how this new legislation affects these taxpayer-funded projects is yet to be seen, and the same applies with federal projects and prevailing-wage requirements.

Currently, many of our projects have wage requirements, such as our school projects, FAA, U.S. Air Force, U.S. Army, etc. We’ve also recently won very large projects that don’t have wage requirements, which proves to me that we can be competitive in either scenario.

What is IEC’s path forward as you deal with right-to-work?

Our path hasn’t changed. We’re committed to doing high-quality work, and doing it safely and efficiently. If anything, the new law has underscored the need for us to be more efficient and professional. As I mentioned, we were recently awarded a large luxury apartment project across from Berkley Riverfront Park in Kansas City that has no wage requirements.

We’re able to remain competitive through careful management of our operations, the use of the construction wireman/construction electrician (CW/CE) program, and pre-fabricating as much as possible. I simply ask the IEC team to remain focused on what we can control: our production, our quality, and working smart. That means planning, a focus on safety, and giving our customer the best service and work. We’ve always competed, and we’ll continue to do so. I’m confident and optimistic in our ability to do just that.

Nilson Goes serves as the chief operations officer and general manager at IEC, an electrical and general contractor serving both commercial and government clients. How will the right-to-work law affect the way you do business? Share your thoughts on our Facebook page or tweet to @IEC_KC.