Illinois Rescinds COVID Era Construction Employment Law

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During the pandemic, when unemployment jumped and the construction industry entered difficult times, Illinois legislators passed the Employment of Illinois Workers on Public Works Act, also known as the Illinois Preference Act.

5% benchmark achieved

The law requires that construction companies and contractors hire at least 90% of their workforce from Illinois residents, at least on public works jobs. Lawmakers intended the legislation to remain in effect until the Illinois unemployment rate dropped below 5%, a benchmark that happened this month.

Naysayers fought the law. The Illinois Chapter of Associated Builders and Contractors (ABC) vice president of regulatory, labor, and state affairs, Ben Brubeck, said, "Local labor policies can create an additional hurdle that contractors and governments must meet regarding taxpayer-funded construction projects. Hurdles like these ultimately exacerbate the industry's skilled labor shortage and increase costs."

Charles Krugel, a labor and employment attorney, endorsed the prohibition's end. "There's a lot of uncertainty in our labor and supply chain markets," said Krugel. "By making Illinois more competitive regarding construction contractors and a construction labor shortage, it's opening its doors to out-of-state labor and making itself more competitive in the construction labor market."

Regulatory challenges

Regulations like these can hinder construction companies' ability to take on jobs. For example, a law in Massachusetts mandated a percentage of the workforce to be filled by women and minorities; 95% of contracts failed to meet the goal.

Decline in COVID allowed sunsetting

However, in this case, all seem happy with the law's demise. "It's rare that a government suspends or sunsets a law. But, in this instance, I think Illinois got it right," said Krugel. "This law seems to have run its course with the decline in COVID infections, the economy's rebound, and the labor shortage."

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