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The Contours of the Illinois Prevailing Wage Act's Narrow Hauling Exemption
November 2011

By: Ryan L. Young, Esq. 

Recently, I have noticed a spike in client telephone calls regarding the Prevailing Wage Act. In particular, clients that are part of the trucking and hauling industry (as well as clients that perform construction work and subcontract hauling services) have been asking the same question: Do our hauling services fall under the Act's hauling exemption?

Under the Prevailing Wage Act, the prevailing wage rate must be paid "to all laborers, workers and mechanics...engaged in the construction or demolition of public works." The Act further clarifies:

"Only such laborers, workers and mechanics as are directly employed by contractors or subcontractors in actual construction work on the site of the building or construction job, and laborers, workers and mechanics engaged in the transportation of materials and equipment to or from the site, but not including the transportation by the sellers and suppliers...shall be deemed to be employed in public works." (Emphasis added.)

The Illinois Courts have interpreted this language in a very straightforward manner; specifically, only those employed by contractors or subcontractors in construction work and transportation of materials to or from the job site must be paid the prevailing wage rate. On the other hand, those employed by sellers or suppliers to haul materials are excluded from coverage. To simplify this even further, think of it this way, if the contractor or subcontractor has its own employees haul or hires a hauling company to haul, the hauling will be covered by the Act. In contrast, if the seller or supplier hauls or hires a hauling company to haul, the hauling will not be covered. It is important to note, that the hauling exemption only applies to the hauling of materials to the project. Any hauling of demolished material from the job site will not fall within the exemption.

Listed below are a few examples of situations where the hauling exemption issue is likely to pop up and whether the hauling is or is not exempt:

  • Contractor/Subcontractor contracts for rocks from 123 Quarry. Contractor/Subcontractor hires ABC Hauling to haul rocks from 123 Quarry to the job site. (NOT EXEMPT. MUST PAY PREVAILING WAGE.)
  • Contractor/Subcontractor contracts for rocks from 123 Quarry. 123 Quarry has its own employees haul the rocks to the job site. (EXEMPT)
  • Contractor/Subcontractor contracts for rocks from 123 Quarry. 123 Quarry hires ABC Hauling to haul rocks from 123 Quarry to the job site. (EXEMPT)
  • Contractor/Subcontractor hires ABC Hauling to haul demolished concrete from the job site. (NOT EXEMPT. MUST PAY PREVAILING WAGE.)

While other examples likely exist, the situations above demonstrate the most common hauling scenarios. The key point to remember is that the hauling exemption to the Illinois Prevailing Wage Act is a very narrow exemption. Sellers and suppliers that haul materials to the job site (or hiring a hauling company to haul the materials to the job site) can rest easy, knowing that the hauling is not covered by the Act. To achieve the same piece of mind, contractors or subcontractors that contract for construction materials would be wise to let the seller or supplier handle the hauling of the materials to the job site.

Questions? Call Attorney Ryan L. Young of Wessels Sherman's Chicago, Illinois office: 312-629-9300 or email him at ryyoung@wesselssherman.com.