Project Labor Agreements The National Labor Relations Act guarantees America’s construction employees the right to unionize. After considering what’s best for themselves and their families, more than 80 percent have decided not to exercise that option. Unfortunately, unions and the politicians their money puts into office have tailored project labor agreements – in overt disregard of these individual decisions – to impose union representation on open shop employees.

PLAs require labor unions to serve as the only bargaining entity for the duration of a construction project in exchange for certain union guarantees of dubious worth. Despite the fact that PLAs trample workers’ rights to determine their own financial strategy, force non-union construction firms to abide by rules they have no say in establishing and drive up construction costs, local, state and federal agencies continue to bow to union pressure. They often not only allow, but in many cases mandate the use of PLAs on public works projects. This approach runs contrary to the public interest in many ways:

PLAs overrule individuals’ rights to self determination

The Associated Builders and Contractors’ blog, www.thetruthaboutplas.com, notes that PLAs can be negotiated before the contractor hires any workers or employees vote on union representation. The National Labor Relations Act generally prohibits these pre-hire agreements because they strip workers of the opportunity decide whether to choose union affiliation through a federally supervised private-ballot election or a card check process. This ban on pre-hire arrangements applies to all industries except construction – another testament to the labor unions’ influence on lawmakers.

Because public works projects governed by PLAs require contractors to agree to these provisions in order to bid on the jobs, employers, rather than their employees, make the decision to accept union representation.

While PLAs don’t allow unions to discriminate against non-union workers, many jurisdictions require all employees be hired through the union hall and mandate these hires adhere to certain union rules that limit workers’ earning potential. That is, the non-union job seeker may be allowed to “classify” herself only as a specific tradesperson. This could mean that once the classification of work for which the employee has been slotted is complete, the employee’s work – and paycheck – ends, even if she is skilled in many different tasks and job duties for which work remains. Indeed, this “multiskilling” is a hallmark of merit shop training.

PLAs force contractors to surrender negotiating power

Contractors – whether union or non-union - who successfully bid on a public work project governed by a PLA must abide by rules they have no ability to craft. In fact, with PLAs the role the contractor’s management team normally would play in negotiations opposite the owner is now played by the union. The fact that the union’s interests are at best segregated from and at worst diametrically opposed to management’s interests points to one of the PLA arrangement’s greatest flaws. Of course this isn’t fair, but contractors who refuse to compete on this unlevel playing field are relegated to the outside looking in when public projects come up for bid.

PLAs impose unwanted and unwarranted expenses on employees

Though employees working on PLA projects may choose not to join the union, in some states they still will be required to pay a portion of union dues. At the same time, PLA rules in some jurisdictions force the non-union employer to pay into the union’s pension plans. This is required even though the non-union firms most likely have established perfectly acceptable retirement and benefit plans for their workers. These merit shop companies continue to fund their own plans while being forced to pay again into the union plans. The companies’ employees, as non-union members, of course will never benefit from these employer contributions.

PLAs punish loyal employees

When project labor agreements require merit shop companies to use union members as all or a portion of the workforce on a public works project, they are forced to exclude their own loyal, hardworking employees. These workers are displaced by unfamiliar workers with skills (or at lease union rules) that limit their usefulness. Unlike the longtime firm employee, the union worker is likely to be unwilling to go the extra mile for the non-union employer. Even when the rules allow open shop companies to use some of their own workers, those employees must be assigned through the union hall clearinghouse.

PLAs work against taxpayers’ interest

There is plenty of evidence that project labor agreements often result in higher construction costs. Politicians continue to insist on PLA’s despite their fiduciary responsibility to taxpayers. Inefficient union rules and the imposition of requirements that shut out many quality bidders and workers limit competition and lead to higher costs. The unconscionable part is that this exclusion of open shop contractors from competing for public works projects often is not merely an unfortunate side effect of PLAs, but their raison d’être.

As 2009 ABC National Chairman Jerry Gorski, noted, “When the federal government sets aside work for a favored few, the result is that hardworking taxpayers pay the price.”

A Beacon Hill Institute study titled “Project Labor Agreements on Federal Construction Projects: A Costly Solution in Search of a Problem,” found that PLAs not only drove federal construction projects alarmingly higher, but that from 2001-2008 – when President George W. Bush prohibited government-mandated PLAs on federal construction projects – there were no instances in which labor disruptions occurred that resulted in significant project delays or increased costs. Clearly, PLAs don’t even offer the few dubious benefits their adherents claim.

Labels: Commercial, Construction Industry, Industrial

¶ 1:23 PM