Reagan takes aim at federal labor construction cost

While he sticks to his hard-line stand with air traffic controllers, President Reagan has taken on another -- but much larger -- group of workers: US construction unions.

Instead of airplanes, the issue this time is federal building projects and proposed new regulations that the Labor Department says could save the government $670 million a year. Construction unions, however, see it as another antilabor move by Mr. Reagan that could further erode their already-diminishing clout among American workers.

The question involves the 50-year-old Davis-Bacon Act, a law that regulates wage rates for government-funded construction projects. Despite urgings from construction executives and trade groups that he fear down the act altogether, Mr. Reagan stuck to a campaign promise last week and instead went for major alterations in regulations governing it.

But the alterations, union leaders say, effectively eliminate Davis-Bacon by taking away a key wage-setting provision and increasing the number of lower-paid "helpers".

Construction groups, meanwhile, feel the President should back one of the eight bills that would repeat the law.

Davis-Bacon requires wages on federal construction projects to be based on "prevailing" wages in the area where the building is taking place. Written during the depression, it was designed to prevent itinerant workers from accepting low wages and taking jobs away from local workers.

To define prevailing wages, the law contains a "30 percent rule" that states federal officials must find the wage level that covers at least 30 percent of the workers and use that wage for all workers in the same crafts on federally financed projects.

Because unionized workers are the only group large enough to make up at least 30 percent, their wages almost always set the prevailing level. Often, however, more workers in an area are paid at lower, nonunion wage levels which contractors prefer.

Under the proposed regulations, a majority of the workers in the area can set the standard. The new rules would also increase the number of helpers that can work with fully trained journeymen from a 1-to-1 ratio to 5-to-1.

Interested parties have until Oct. 24 to comment.

But one who wasted no time in commenting was Robert Georgine, president of the AFL-CIO Building and Construction Trades Department.

"This action rolls back 50 years of worker protections," he said in a statement. The changes would mean construction workers could once again be competing with workers from another part of the country, he added.

For example, says Stan Smith, executive secretary of the Building Construction Trades Council in San Francisco, a $3 billion project to rebuild the city's sewer system is expected to begin this year. Three-quarters of the cost is being paid by the US government. Without current Davis-Bacon provisions , "we could see construction companies from the South coming here with their lower-paid workers," Mr. Smith said.

But construction groups were not satisfied, either.

"It's an attempt to make a bad law better," said Colette Nelson, assistant director of government relations at the Associated Builders and Contractors, a group representing large general contractors and smaller subcontractors. Like other construction groups, the ABC favors outright repeal of Davis-Bacon.

In addition to the eight pro-repeal bills in Congress, a military construction authorization bill recently came out of the Senate Armed Services Committee with an amendment eliminating Davis-Bacon provisions on military construction projects, she said.