Electrical Association Weighs in on Assault on Prevailing Wage
Honorable Gavin Newsom, Governor
Honorable Mike McGuire
Honorable Robert Rivas
Honorable Scott Wiener
Honorable Jesse Gabriel
Honorable Brian Jones
Assemblymember James Gallagher
RE: Proposed Housing Budget Trailer Bill
Dear Governor Newsom, President pro Tempore McGuire, Speaker Rivas, Senator Wiener, and Assemblymember Gabriel:
On behalf of the California State Pipe Trades Council, the Western States Council of Sheet Metal Workers, and the California State Association of Electrical Workers, we write in fierce and unequivocal opposition to this proposed budget trailer bill, a bill that masquerades as housing reform while launching an all-out assault on the livelihoods, health, and dignity of California construction workers.
ASSAULT ON PREVAILING WAGE
This bill proposes a new, artificial minimum wage for construction workers that would, in effect, dismantle California’s nearly century-old prevailing wage law—a bedrock protection for workers and the skilled trades. Rather than uphold time-tested labor standards, this trailer bill attempts to legitimize a substandard, state-invented wage system that operates entirely outside the framework of the Labor Code, certified payrolls, collective bargaining, and apprenticeship oversight.
It stands as one of the most brazen assaults on prevailing wage in modern California history—a clear effort to normalize paying skilled tradespeople far below area standards under the guise of housing production. The bill creates a parallel, second-class wage structure that devalues the training, certification, and experience of union electricians, plumbers, sheet metal workers, and others.
For nearly 100 years, prevailing wage laws have ensured that public and publicly incentivized construction does not become a race to the bottom. This trailer bill turns that principle on its head, ushering in a race to the bottom where skilled and trained workers are systematically undercut and denied fair, livable wages they’ve earned through years of experience and training.
BILL’S PROPOSED WAGE SCALE CREATES SUBSTANDARD NON-LIVABLE WAGES
Skilled electricians, plumbers, and sheet metal workers—the backbone of safe, reliable construction— would be forced to accept substandard and non-livable wages on these housing projects. Under the proposal, in 44 counties, the minimum wage will be set at $20 per hour, before accounting for any healthcare payments. This results in a total wage that would fall well below the minimum wages established for fast food and healthcare workers by this Legislature. No other minimum wage law in California includes employer contributions to healthcare in wage calculations, making this approach both inequitable and unprecedented. This means that for the first time ever, the California Legislature is going to force construction workers to pay for their own healthcare on residential housing projects. The $20-$40 per hour wage rates in the bill depending upon geographic location really mean nothing since those rates can be lowered based upon undefined “healthcare coverage.”
DELIBERATELY EXCLUDING UNION WORKERS AND UNION CONTRACTORS
Make no mistake: this trailer bill is written to ensure that union workers do not build a single one of these housing projects. By setting arbitrary flat rates instead of requiring the general prevailing wage, it locks out union contractors who follow collectively bargained wage rates and invest in state-approved apprenticeship programs.
This bill signals to every high-road contractor in the state: “You’re not welcome here.” It penalizes those who provide career pathways, hire local apprentices, and meet rigorous training and safety standards—just to appease developers seeking cheap labor.
IMPOSSIBLE ENFOREMENT
The wage rates in this trailer bill are arbitrary, confusing, and designed to drag construction deeper into the underground economy. The bill pretends to empower Joint Labor Management Committees to enforce these wage and health care schemes but offers no tools to do so.
No certified payrolls. No required health care reporting. No transparency. The dual wage structure and vague healthcare credit make it nearly impossible to verify if workers are getting paid fairly.
Even worse, the bill’s mandate that a percentage of workers earn different wages is a logistical nightmare. With multiple subcontractors on a site, who tracks compliance? Who determines who is owed backpay, and how? And since the Labor Commissioner cannot enforce these wages through Civil Wage and Penalty Assessments, workers are left with no real enforcement and no real justice.
This bill is not just bad policy. It is unworkable and completely unenforceable.
ALREADY EXISTING CEQA EXEMPTIONS
This bill is a direct assault on the labor protections enshrined in SB 423 (Wiener), which ensured that high-rise housing projects—those over 85 feet—could benefit from CEQA streamlining only if they respected middle-class construction standards. In San Francisco alone, numerous projects are already moving forward using SB 423 exemptions while fully complying with these labor requirements. The system is working—so why is the Legislature now trying to weaken it?
Let’s be clear: California already has an arsenal of housing streamlining laws on the books—SB 423, AB 2011, SB 35, SB 6, and many more. There are over sixty CEQA exemptions for infill housing, and public funding for affordable housing has never been more abundant. Despite all of this, developers are still not building. Not because they can’t, but because they won’t—and they’re pointing the finger at workers’ wages to deflect from their own unwillingness to act.
Enough is enough. Middle-class construction workers are ready and able to build the housing California needs. It’s time to stop chipping away at construction worker protections and start holding developers accountable for their failure to build.
CONCLUSION
This bill is COMPLETLEY unnecessary for a host of reasons but, most critical to us, it is unnecessary because it is solving for a problem that doesn’t exist by lowering the wages paid to construction workers on housing projects. By supporting this bill, you will be turning your back on nearly a hundred years of prevailing wage law that works in the public and private sector that guarantees construction workers living wages, healthcare benefits, a modest pension, and dignity on the job while compensating them properly for their world class training and skills. It is for these reasons that we urge you to abandon any pursuit of this harmful and unprecedented
proposal, which would devastate construction workers and the integrity of prevailing wage law in California.
There are numerous factors contributing to the high cost of housing construction in our state that extend beyond nominal labor costs. Blaming workers by establishing substandard and below-market wages is not the solution.
We urge you to unequivocally reject this budget trailer bill when it comes before the Senate and Assembly Budget Committees.
Regards,
Scott Wetch
