Why is ABC Opposed to Union-Only PLAs

Why is ABC Opposed to Union-Only PLAs?

PLAs discourage or prohibit merit shop contractors from competing for and winning construction project contracts. Construction contracts subject to mandated PLAs are almost always awarded exclusively to unionized contractors and their all-union workforces (hence the term union-only). Less competition and archaic and inefficient union rules increase the cost of construction projects subject to PLAs.

According to the most recent data from the U.S. Department of Labor’s Bureau of Labor Statistics, only 14 percent of the 2011 U.S. private construction workforce belonged to a union. This means PLAs discriminate against more than eight out of 10 construction workers who would otherwise work on construction projects if not for a PLA.

PLAs typically include the following provisions that discourage merit shop contractors from working on PLA projects:

  • Despite the fact contractors have their own benefit plans, PLAs require merit shop contractors to pay their workers’ health and retirement benefits to union trust funds. Thus, companies have to pay benefits twice: once to the union and once to the company plan. Nonunion employees never see any of the benefit contributions sent to union plans unless they decide to join a union and remain with the union until vested.
  • Paying into underfunded and mismanaged union pension plans can expose merit shop contractors to significant pension withdrawal liabilities and/or litigation. Signing a PLA and exposing a company to pension liabilities could bankrupt a contractor or prohibit a company from qualifying for construction bonds needed to build future projects.
  • PLAs require merit shop companies to obtain apprentices exclusively from union apprenticeship programs. Participants in federal and state-approved nonunion apprenticeship programs cannot work on a job covered by a PLA. This means craft professionals enrolled in all apprenticeship programs other than those offered by the union are excluded from local job opportunities.
  • PLAs require merit shop companies to obtain most or all of their workers from union hiring halls. This means a merit shop company has to exclude its hardworking employees from specific jobsites and use unfamiliar union workers instead. In rare instances, merit shop employers can use a limited number of their own employees; to do so, they must send their nonunion employees to the union hiring hall and hope the union sends the same employees back to that specific PLA jobsite.
  • Nonunion employees may have to pay union dues and fees or join a union in order to work on a PLA project. 

Learn more about the provisions in typical PLAs and how they harm nonunion contractors and employees at “Project Labor Agreement Basics: What Is a PLA?” (4/24/09).

PLAs drive up the cost of construction projects

By unnecessarily limiting bidders and following outdated and inefficient union work rules, PLAs consistently and unnecessarily drive up project costs. Analysis of numerous academic studies of public construction projects subject to prevailing wage laws indicate PLAs increase the cost of construction between 12 percent and 18 percent when compared to similar projects not subject to union-only PLAs.

PLAs discriminate against merit shop contractors and disadvantaged businesses and their employees

This discrimination is particularly harmful to women- and minority-owned construction businesses – whose workers traditionally have been under-represented in unions, mainly due to artificial and societal barriers in union membership and union apprenticeship and training programs. Get the facts about the impact of union-only PLAs on women-and minority-owned construction businesses and workers:

House Committee on Small Business Hearing on PLAs and Minority and Women

PLAs harm local workers

Proponents claim PLAs ensure the use of local workers, but the truth is PLAs fail to inspire local hiring and job creation (learn more here). PLA supporters fail to mention the term “local workers” excludes local nonunion workers. This rhetoric is particularly misleading because only 14 percent of U.S. construction workers belong to a union. In construction markets where the demand for union labor is greater than the supply, union workers from outside the local area are given preference over qualified local nonunion workers on PLA projects. These union workers are called travelers or boomers, and they take jobs away from local and qualified nonunion craft employees.

PLAs take away Employee rights

Employees normally are permitted to choose whether to join a union through a card check process or a federally supervised private ballot election. PLAs require unions to be the exclusive bargaining representative for workers during the life of the project. When agreeing to participate in a PLA, the decision to elect union representation is made by the employer rather than the employees. PLAs are called pre-hire agreements because they can be negotiated before the contractor hires any employees or employees vote on union representation. The National Labor Relations Act (NLRA) generally prohibits pre-hire agreements, but an exception in the law allows for these agreements only in the construction industry. In short, government-mandated PLAs strip away the right of construction workers to a federally supervised private ballot election or a card check election when deciding whether to unionize their workplace.

PLAs are not necessary to, and are not successful at, ensuring labor peace or keeping a project on time or on budget

Unions use the threat of labor strikes and unrest to leverage construction users into requiring PLAs. This is a particularly disingenuous argument that flirts with blackmail because unions cause many project delays through illegal organizing and jurisdictional disputes on jobsites. In addition, unions have engaged in strikes and labor disputes on PLA projects, calling into question the value of the agreements (learn more here). In contrast, merit shop workers do not strike, yet they typically are discouraged from working on PLA projects.

As documented in the following linked blog posts, government-mandated PLAs do not guarantee a safe jobsite, nor do they ensure compliance with labor laws.

A 2011 report by ABC general counsel Maury Baskin, Government-Mandated Project Labor Agreements: The Public Record of Poor Performance (2011 Edition), documents the numerous broken promises and mishaps on government-mandated PLA construction projects, such as the infamous Big Dig in Boston, Mass.View the latest information about discriminatory and costly project labor agreements on ABC's website and blog at: www.TheTruthAboutPLAs.com, its Facebook page at www.facebook.com/TheTruthAboutPLAs and Twitter handle @truthaboutplas.

For staff information, contact Roxanne Rivera-Wiest at Associated Builders and Contractors.