Academic journal article Northwestern Journal of Law and Social Policy

Beary Landscaping, Inc. V. Costigan: The Case for Repealing the Illinois Prevailing Wage Act

Academic journal article Northwestern Journal of Law and Social Policy

Beary Landscaping, Inc. V. Costigan: The Case for Repealing the Illinois Prevailing Wage Act

Article excerpt


In the district court opinion that would form the basis of the appeal in Beary Landscaping, Inc. v. Costigan, Judge James Zagel remarked that "[p]laintiffs have produced some eyebrow-raising figures that suggest that Defendant [Catherine Shannon, then the director of the Illinois Department of Labor] is doing no favors for the taxpayers of the State of Illinois."1 He then elaborated in a footnote:

To take just one example, on Federal and private landscaping projects undertaken in Cook County, the going rate for a "landscape helper" in June 2010 was $11.50 per hour in total compensation. The same person working a state-funded project would receive a total hourly compensation package of $52.70- that is, 458% of the comparable federal or private rate.2

The disparity in those two figures is shocking, though it is not representative of the average disparity between Illinois rates and private or federal rates for every worker classification. However, it does bring into focus the artificiality of the concept of a prevailing wage and elucidate one of the perils of employing price controls in the labor market.

A primary reason for the difference in the two wages is that Illinois does not distinguish between landscapers and ordinary laborers.3 Another relates to the fact that the Illinois Prevailing Wage Act, like many prevailing wages laws, does not recognize a category of workers called "helpers."4 Using helpers to do much of the "grunt work" on a job, while simultaneously giving them a chance to learn the trade, is one thing that non-union contractors do to control costs because helpers are paid much less than union journeymen.5 But the unions seem to exert enough influence in Illinois to have prevented the legal recognition of helpers in the Illinois Prevailing Wage Act, thus requiring the state to pay a landscaping helper as much as a laborer.

This Note uses the Seventh Circuit's recent decision in Beary Landscaping, Inc. v. Costigan as an occasion to analyze the Illinois Prevailing Wage Act ("Prevailing Wage Act" or "Act"). In Beary, a group of ten landscaping contractors sought to enjoin the director of the Illinois Department of Labor from setting the prevailing wage rate by relying on the rates in the collective bargaining agreement of the union historically relied on for wage rates.6 The contractors argued that this amounted to an unconstitutional delegation of legislative authority to private parties.7 Though they did not succeed, Beary revealed serious problems with the Prevailing Wage Act.

This Note will first discuss how the Act functions. Then, it will detail the challenges brought by the group of landscaping contractors in Beary and in Illinois Landscape Contractors Ass'n v. Department of Labor, an Illinois Appellate Court decision that effectively dictated Beary's outcome. It will proceed with an application of public choice theory to the Prevailing Wage Act, arguing the Act is a quintessential example of interest group legislation that benefits a concentrated group at the expense of a diffused group. Central to this point is a unique provision in the Act that allows only wages paid on public works projects to be used in the calculation of the prevailing wage.8

Ultimately, this Note addresses how incentive structures inherent in the law invite governmental largesse, if not outright corruption. The best solution is simply to repeal the Act, particularly because the courts have made it clear they have no interest in fixing the legislature's mess.9 10 This Note suggest that, if the law is to be retained at all, the Illinois Department of Labor (IDOL) should be required to conduct scientific wage surveys using data from private and public works when calculating the wage rates. Furthermore, a new classification should be added for landscaping helpers that continue to be subject to the Prevailing Wage Act.

I. The Illinois Prevailing Wage Act

A. The Origin of the Illinois Prevailing Wage Act

During the New Deal, Congress passed the Davis-Bacon Act, requiring that the prevailing wage be paid to all workers on federally funded public works projects. …

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