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Phyllis Harden

Legislative & Special Projects, Pine Bluff Sand & Gravel
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Industry Priorities

Government Mandated Project Labor Agreements (PLA)

AGC Policy & Background Information

  • AGC is Committed to Full and Open Competition for All Public Projects. AGC strongly believes that the choice of whether to adopt a collective bargaining agreement should be left to the contractor-employers and their employees, and that such a choice should not be imposed as a condition to competing for, or performing on, a publicly funded project. Government mandates and preferences for PLAs can restrain competition, drive up costs, cause delays, lead to jobsite disputes, and disrupt local collective bargaining. In cases where use of a PLA would benefit a particular project, the construction contractors otherwise qualified to perform the work would be the first to recognize that fact and to adopt a PLA voluntarily. They would also be the most qualified to negotiate the terms of such an agreement.
  • Government-Mandated PLAs Can Have the Effect of Limiting the Number of Competitors on a Project. This is because government mandates for PLAs typically require contractors to make fundamental, often costly changes in the way they do business. For example, a PLA may require a contractor to recognize the local unions as the representatives of their employees on that job; use the union hiring hall to obtain workers; reintroduce inefficient work rules that have been abandoned over the course of collective bargaining; and pay into union benefit and multi-employer pension plans that nonunion employees will never be able to access, forcing non-signatory employers to pay twice for retirement and health care benefits. Such changes are impracticable for many contractors and subcontractors, particularly those not historically signatory to collective bargaining agreements. According to the Bureau of Labor Statistics, union representation in the U.S. construction industry dropped another 5.6 percent in 2010, to a level of only 13.7 percent.
  • There is No Evidence Proving the Claim that PLAs Will Improve the Economy or Efficiency of a Project. Case studies of the economic benefits of PLAs have had varying conclusions. The Congressional Research Service recently issued a report examining many of the arguments for and against PLAs and reviewing previously published research on their economic effects. The Government Accounting Office also reported that it could not document the alleged benefits of past mandates for PLAs on federal projects and that it doubted such benefits could ever be documented due to the difficulty of finding projects similar enough to compare and the difficulty of conclusively demonstrating that performance differences were due to the PLA versus other factors.

Additional Information

To view the AGC of America Policy adopted by the board in 2009, please click here.

To download AGC’s Talking Points on Executive Order 13502, please click here.

For more more in-depth background information on PLA’s, please check out our guidebook: Government Mandated Labor Agreements in Public Construction: Their History and Factors to Consider.

Regulations & Guidance

Executive Order 13502

On February 6, 2009, President Obama issued Executive Order 13502 entitled Use of Project Labor Agreements for Federal Construction Projects. The Executive Order, which was published in the Federal Register on February 11, 2011, encourages government agencies to use PLA’s in large-scale federal construction projects where the total cost to the Government is $25 million or more. President Obama justifies the use of PLA’s in 13502 by stating that “construction employers typically do not have a permanent workforce, which makes it difficult for them to predict labor costs when bidding on contracts and to ensure a steady supply of labor on contracts being performed. Challenges also arise due to the fact that construction projects typically involve multiple employers at a single location. A labor dispute involving one employer can delay the entire project. A lack of coordination among various employers, or uncertainty about the terms and conditions of employment of various groups of workers can create frictions and disputes in the absence of an agreed-upon resolution mechanism. These problems threaten the efficient and timely completion of construction projects undertaken by federal contractors.”

To address these perceived challenges, Executive Order 13502 encourages, but does not mandate, the use of PLAs on large-scale construction projects. Rather, agencies may on a project-by-project basis, require the use of a PLA by a contractor where use of such an agreement will advance the Government’s interest in achieving economy and efficiency in federal procurement, producing labor-management stability, and ensuring compliance with laws and regulations governing safety and health, equal employment opportunity, labor and employment standards, and other matters. If appropriate, an agency may require that every contractor or subcontractor on the project agree to negotiate or become a party to a PLA with one or more appropriate labor organizations.

The Administration issued the final rule in the Federal Register on April 13, 2010 amending the Federal Acquisition Regulation (FAR) to implement the Executive Order.

Agency Policies

Oppose Government Mandated Project Labor Agreements (PLAs)

Background:

  • The Government Neutrality in Contracting Act would ensure fairness in the federal procurement process. Efforts that would impose or favor the use of government mandated project labor agreements (PLAs) on federal and federally funded construction projects should be opposed.
  • PLAs effectively compel both union and open shop contractors to alter their hiring practices, work rules, job assignments, and benefits in order to compete for or to perform work on publicly funded projects.
  • There is no reliable evidence that project labor agreements improve the performance and they can even give rise to jurisdictional disputes that would not otherwise occur.

Action Needed:

Contact your elected officials and ask them to cosponsor the Government Neutrality in Contracting Act to keep in place the well-settled patterns of labor-management relations in the construction industry and the cost-effectiveness of public works.

Legislation of the 112th Congress:

S. 119: Government Neutrality in Contracting Act – Would preserve open competition and Federal Government neutrality towards the labor relations of Federal Government contractors on Federal and federally funded construction projects. (Introduced Jan. 25, 2011)

H.R. 735: Government Neutrality in Contracting Act – Would preserve open competition and Federal Government neutrality towards the labor relations of Federal Government contractors on Federal and federally funded construction projects. (Introduced Feb. 16, 2011)

H.Amdt. 147 to H.R. 1 – Amendment sought to prohibit the use of funds to enter into a Government contract that requires a project labor agreement. (Vote failed 210 – 210, Feb. 19, 2011)

H.Amdt. 388 to H.R. 2017 – Amendment sought to prohibit the use of funds to implement or enforce Executive Order 13502 which mandates project labor agreements (PLA's) on projects that are worth $25 million or more. (Vote failed 207-213, June 2, 2011)

H.Amdt. 411 to H.R. 2055 – Amendment to strike Section 415 of the bill which would prohibit the use of federal funds to require by contract the use of a PLA for projects funded during fiscal year 2012. (Vote passed 204-203, June 13, 2011)

Testimony and Letters to Capitol Hill:

06/13/2011 Letter to House of Representatives re LaTourette H.Amdt. 411 to H.R. 2055

On June 13, 2011 Congressman LaTourette offered H.Amdt. 411 to H.R. 2055, which would strike Section 415 of the bill which would prohibit the use of federal funds to require by contract the use of a PLA for projects funded during fiscal year 2012. AGC sent a letter to Speaker Boehner to express opposition to the amendment. On June 13, 2011 the amendment passed by a vote of 204-203.

06/03/2011 AGC Statement for House Oversight and Government Reform Committee Hearing

On June 3, 2011 Mike Kennedy, Chief Counsel for the Associated General Contractors of America testified in front of the House Oversight and Government Reform Subcommittee on Technology, Information Policy, Intergovernmental Relations and Procurement Reform at a hearing titled, “H.R. 735 and Project Labor Agreements: Restoring Competition and Neutrality to Government Construction Projects.” AGC also submitted a written statement expressing concern with the use of Government Mandated Project Labor Agreements.

06/02/2011 Letter to House of Repesentatives re Scalise H.Amdt. 388 to H.R. 2017

On June 1, 2011 Congressman Scalise offered H.Amdt. 388 to H.R. 2017, which would prohibit the use of funds to implement or enforce Executive Order 13502 which mandates project labor agreements (PLA's) on projects that are worth $25 million or more. On June 2, 2011 AGC sent a letter to the House of Representatives expressing support of the amendment. On June 2, 2011 the amendment failed by a vote of 207-213.

03/16/2011 Statement of the Associated General Contractors of America - PLA Hearing

On March 16, 2011 the U.S. House of Representatives Committee on Oversight and Government Reform held a hearing titled, “Regulatory Impediments to Job Creation: The Cost of Doing Business in the Construction Industry.” AGC submitted a written statement expressing concern with the use of Government Mandated Project Labor Agreements.

02/17/2011 Letter to Rep Guinta re Guinta H.Amdt. 147 to H.R. 1

On February 18, 2011 Congressman Guinta offered H.Amdt. 147 to bill H.R. 1, which would prohibit the use of funds to enter into a Government contract that requires a Project Labor Agreement. On February 17, 2011 AGC sent a letter to Congressman Guinta to express support for his Amendment. On February 19, 2011 the amendment failed by a vote of 210-210.

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Regulatory Advocacy

Solicitations on several federal construction projects requiring bidders to submit an executed project labor agreement (PLA) prompted AGC to write and call agency officials expressing strong concern.

The letters are the latest of AGC's continuing successful efforts to educate government agencies about PLA issues and implications. While AGC neither supports nor opposes PLAs in general, AGC strongly opposes government mandates for PLAs on publicly funded construction projects. AGC is committed to free and open competition in all public construction markets and believes that publicly-funded contracts should be awarded without regard to the lawful labor relations policies and practices of the government contractor.

The most recent letters from approximatly the past 3 years are listed below, as is a list of the 113 letters sent by AGC opposing PLAs during the Obama administration.

List of Letters sent by AGC during Obama Administration:

List of letters

Letters to Administration:

08/17/2010 – AGC letter to President Obama on Executive Order 16502

Letters to the Federal Agencies:

Federal Highway Administration (FHWA):

09/08/2010 – FHWA-funded Construction Projects

02/12/2010 – Lake Champlain Bridge, Lake Champlain, Vermont

Department of Labor (DOL)

10/07/2011 – Jobs Corps Center, Manchester, New Hampshire

09/23/2009 – Jobs Corps Center, Manchester, New Hampshire

General Services Administration (GSA)

03/01/2011 – Social Security Administration National Support Center

01/04/2011 – New Federal Office Building, Broward County, Florida

11/22/2010 – NASA Langley Research Center

01/23/2015 – Training Center in Virginia

Naval Facilities Engineering Command (NAVFAC)

01/03/2013 – NAVFAC Washington: NSA Annapolis, Annapolis, Maryland

07/18/2013 - NAVFAC Pacific: Aircraft Maintenance Hanger Upgrade

07/18/2013 - NAVFAC Pacific: Pearl harbor, Hawaii

07/24/2013 - NAVFAC Washington: Nimitz Library

07/24/2013 - NAVFAC Northeast: U.S. Naval Academy

12/09/2013 - NAVFAC Washington: Naval Support Activity Bethesda

03/04/2014 - NAVFAC Pacific: Infrastructure and Hanger

08/08/2014 - NAVFAC Southwest: Naval Base San Diego

08/17/2014 - NAVFAC Northwest: Naval Base Kitsap at Bremerton

08/21/2014 - NAVFAC Southwest: Imperial Beach, California 

01/12/2015 - NAVFAC Southwest: Imperial Beach, California 

07/24/2015 - NAVFAC Southwest: Costal Campus Program, California

07/24/2015 - NAVFAC Southwest: Littoral Combat Ship Facility, California

10/26/2015 - NAVFAC Southwest: Industrial Training Complex, California

U.S. Army Corps of Engineers (USACE)

02/24/2014 - Los Angeles District: Edwards Air Force Base

03/25/2014 - U.S. Department of Veteran Affairs

05/06/2014 - Little Rock District: Little Rock Air Force Base

05/09/2014 - Norfolk District: Fort Eustis

07/30/2014 - USACE Huntsville: Honolulu, Hawaii

08/28/2014 - Los Angeles District: Murrieta Creek Flood Control

10/20/2014 - Vicksburg District: Plaquemines Parish, Louisiana

10/23/2014 - Baltimore District: Baltimore, Maryland

10/24/2014 - Fort Worth District: Fort Hood

01/23/2015 - Charleston District: Ft. Jackson Basic Training Complex

02/20/2015 - Charleston District: Charleston Area Projects

02/24/2015 - Omaha District: Lower Yellowstone River Dam

03/02/2015 - New Orleans District: Hurricane Protection System

11/13/2015 - Honolulu District: $250 M MATOC Hawaii

11/13/2015 - Honolulu District: Health Parking Structure Schofield Barracks

01/15/2016 - Nashville District: Cofferdam Lock Project

01/28/2016 - Nashville District: Chickamauga Lock Project

06/24/2016 - Louisville District: Robins AFB office building

08/26/2016 - Los Angeles District: Wright-Patterson AFB Hanger Project

09/2/2016 - Louisville District: Wright-Patterson AFB Hanger Project

09/2/2016 - Louisville District: Seymour Johnson AFB Hanger Project

09/16/2016 - Pittsburg District: Monongahela River Dredging Project 

11/4/2016 - Honolulu District: DB and DBE Work Within Hawaii

11/18/2016 - Alaska District: Eielson AFB Hanger Project

11/28/2016 - Alaska District: Eielson AFB Weather Shelter Project

1/18/2016 - Albuquerque District: Cannon AFB Operations Facility Project

 

Resources

AGC News and Updates

Articles, Papers & Presentations

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