The Biden administration has gone on to announce recently that a final rule executing an executive order will go on to need the project labor agreements on federal construction projects valuing $35 million or more. It will most likely result in PLAs being needed when it comes to a majority of large federal jobs.
The US President Joe Biden first brought the rule change in February of last year, but it is not going into effect until 30 days after it is published in the Federal Register on December 22, this year, because of formal rule change methodologies by the Federal Acquisition Regulatory Council. It is well to be noted that the executive order’s implementation goes on to replace an Obama-era rule that encouraged PLAs when it came to federal jobs but did not mandate the practice.
Because of this, the White House expected that as many as 200,000 workers on federal construction jobs could see enhanced wages, benefits, along with safety protections irrespective of their union membership.
It is worth noting that part of the goal of the executive order, as per the White House fact sheet, is to surge the efficiency by having all stakeholders, such as contractors, subcontractors, unions, as well as other labor groups, negotiate the terms of every project ahead of time.
The White House happens to claim the PLAs will benefit and better the projects by:
- Eradicating project delays due to labor unrest like strikes.
- Coming up with dispute resolution processes and cooperation in terms of labor-management disputes like those over safety.
- Including provisions so as to support workers coming from underserved communities as well as small businesses.
- Aiding in creating a steady pipeline of workers in case of federal projects.
- Pushing competition on government contracts so that builders, even those with a non-union bent, can bid on jobs that need a PLA.
Although labor groups champion PLA, stating that they better protect workers, several builders, along with the employer groups, go on to claim that they disadvantage contractors that don’t work along with unions often.
It is worth noting that the Biden administration first inked the executive order that all subcontractors as well as contractors will still be able to go ahead and compete for work, irrespective of their experience concerning collective bargaining.
Such an executive order does not require anyone to be a union contractor, but it does require them to basically agree on a one-off basis to agree on a pre-hire collective bargaining agreement, said partner at New York City construction law firm Zetlin & De Chiara, James Terry.
Reaction from construction groups
On December 18, Sean McGarvey, who happens to be the president of North America’s Building Trades Unions, praised the execution.
He added that with this latest action to make economic security more robust, labor-management relations as well as family-sustaining job opportunities, President Biden has yet again gone on to demonstrate his rock-solid commitment when it comes to American taxpayers and all workers, union and non-union, throughout the country.
The employer trade groups, however, pushed back against the mandate.
The vice president of regulatory, labor, and state affairs for Associated Builders and Contractors, Ben Brubeck, decried the rule, calling it inflationary, burdensome, as well as anti-competitive and also claiming that it would raise the costs of projects and also steer contracts toward contractors and workers that are unionized. He added that the ABC has plans to challenge this rule in court.
Brubeck went on to say that, absent a successful legal challenge, this particular executive overreach will go ahead and reward the powerful special interests having government construction contracts, and that too at the expense of taxpayers, as well as the principles of free enterprise along with fair and open competition in government procurement.
