Responsible Employer Ordinances (REOs) are a very public response to the frustration of municipal officials over the problems created by a handful of contractors that cheat on prevailing wages, workers’ compensation insurance and unemployment insurance. These bad actors undermine the bidding process and reduce the number of potential bidders by discouraging reputable contractors that play by the rules. Nationwide, dozens of jurisdictions have adopted REOs, including 18 municipalities in Massachusetts alone. While the language of the ordinances vary, they all restate principles of existing state laws concerning workers’ compensation insurance, unemployment insurance and proper classification of workers to ensure tax
The market is generally healthy and steadily growing, and margins are up for large specialty contractors. Further, advances in design tools and owner demand for collaboration are giving subcontractors a seat at the table early on in projects.