Many Union Contractors Settle w/ OE 324 – Industry Should Be Aware of New Language

Several union contractors across the state (listed below), who are involved in road and bridge construction, have settled on a new statewide road contract (attached)with Operating Engineers, Local 324 (OE 324). There are significant changes in the new contract compared to the expired MITA Road agreement and some of these changes will likely have a broad impact on the overall heavy construction industry here in Michigan.

The most significant change in the five-year agreement (expires May 31, 2024) is in the area of subcontracting. In this new contract, language has been added that requires any and all subcontractors of a signatory contractor to now “comply with the rates, terms, conditions and fringe benefit contributions of the Agreement”. This means that any subcontractor of a signatory contractor will now have to pay into the fringe benefit funds of the Operating Engineers, Local 324 for all work that falls under the jurisdiction of that union. This fringe package amounts to approximately $28.41 per hour for each operator. Certified Disadvantaged Business Enterprises (DBEs) are exempt from this requirement.

Other changes include adjustments to several classifications throughout the contract, including CDL recognition, Employer’s Discretionary Classifications for Foremen, Asphalt Screw/Screen Operator and Lowboy Drivers, along with numerous “Premium Pay” changes (list of amendments attached). In Article I, paragraph 2, underground electrical was added to the definitions. Also included are some changes to the overtime provisions, which eliminates all “Double Time”, except for six holidays, which are located on page 40 of the contract.

The economics of the agreement include a $1.75 increase effective 4/1/19, when compared to the road agreement that expired on 5/31/18, a $1.25 increase effective 6/1/19 and a $1.25 increase effective 6/1/20, with a $2.00 increase on June 1 each year in 2021, 2022 and 2023. The new agreement also now has only one statewide “Zone” and thus, a single wage rate for each “Classification”.

Finally, there was also language added that refers to a Hiring Hall Procedure, which will now be in place. Please see the Letter of Understanding for the Hiring Hall, located on page 47 of the contract.

If you have questions about the contract negotiations or would like to sign onto the new contract through a Power of Attorney with the MI Union Contractors Group, please contact Bob Adcock (Iafrate) at badcock@iafrate.com, Mike Malloure (C.A. Hull) at mmalloure@cahull.com or Mark Johnston (Ajax) at mjohnston@ajaxpaving.com.

A list of the companies who have currently signed onto the OE Agreement is as follows:

Ajax Paving

Anlaan

C.A. Hull

Cadillac Asphalt

Cipparone Contracting

Dan’s Excavating

Doan Construction

Edward R. White

Florence Cement

Highway Service

Hoffman Bros.

Iafrate

Interstate Highway Construction

M & M Excavating

Milbocker & Sons

Nagle Paving

Sanches Construction

Toebe Construction

Z Contracting

There will be several clarifications and updates during the implementation of this significant change, and additional bulletins will be forthcoming. If you have any other questions, please contact Mike Nystrom at mikenystrom@thinkmita.org.

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