The House Labor and Industry Committee shot down Governor Ernie Fletcher's proposals, repeal of the prevailing wage and adoption of right-to-work rules.
Right-to-Work legislation would allow workers to take jobs without joining unions or paying union fees at labor-represented workplaces.
Opponents of the measure, like Eldon Renaud, President of the local UAW, say it's the decision they expected.
"Truthfully, I think legislators realize it's right to work for less. They realize people are supposed to get a job to earn their way out of poverty, not to keep them in it."
Supporters of the measure say they will continue speaking out on it.
"The secret I think is to build a little bit more momentum in advance of the next legislative session, that gives us more time for debate and discussion."
Bowling Green Chamber President Jim Hizer says he's disappointed with the decision, but never expected the proposal to pass.
Prevailing-Wage laws were also shot down today. Those are laws that require contractors doing work on government buildings and schools to pay the typical area wage. Fletcher and some business groups have said that businesses are reluctant to move to Kentucky because of its labor laws.