As Congress negotiates billions of dollars in potential federal funds for construction through the economic stimulus bill, President Barack Obama moved to bring back union-only project labor agreements as an option on federally funded projects. The president on Feb. 6 issued an executive order overturning a Bush administration ban on federal PLAs and opened the door to such pacts on projects of $25 million or more.
The order fulfills a promise made during the presidential campaign to unions to advocate for their interests. Getting the PLA ban reversed was cited by union officials as a high priority on its wish list for the new administration.
"We anticipate any project over $25 million through the stimulus package would justify project-labor agreements," says Tom Owens, spokesperson for the AFL-CIO’s Building and Construction Trades Dept. "That’s got us very excited."
The executive order reinstates much of the guidance on PLAs that was in place during the Clinton administration. It says federal agencies "may, on a project-by-project basis, require project-labor agreements" when it would enhance economy and efficiency in procurement of work.
The order also calls on the director of the Office of Management and Budget to recommend within six months whether broader use of PLAs on federal and federally assisted contracts would help "promote the economical, efficient and timely completion of such projects."
BCTD President Mark Ayers praises Obama’s action, saying it will benefit both union and nonunion workers. Ayers says the order is "one of the first steps in ushering in a new, more pragmatic and value-conscious approach to governing."
But Stephen Sandherr, chief executive officer of the Associated General Contractors, warns that the executive order has the "unfortunate potential to limit contractors’ ability to compete for projects" at a time when millions of construction workers have lost jobs. "Given that federal agencies have no demonstrated expertise in writing contracts that cover contractors and their employees, we strongly encourage officials to exercise the discretion this order provides and avoid government-mandated labor agreements," he says. AGC members include both union and nonunion employers.
Open-shop groups are not happy with the move. The order "opens the door to waste and discrimination in federal and federally funded construction contracts," says Kirk Pickerel, president of the Associated Builders and Contractors, whose members are predominately open shop. The order "removes the safeguards that prohibited discrimination based upon union affiliation in the awarding of federal contracts," he says.
Pickerel claims that such agreements could increase construction costs between 10% and 20%. Further, he says, it may discriminate against 84% of U.S. construction workers, including "minorities, women and qualified construction workers who have traditionally been excluded from union membership."
Among the order’s provisions, any agency using a PLA would need to show that such an agreement would advance the federal government’s interest in achieving economy and efficiency in procurement, producing labor-management stability and ensuring compliance with laws and regulations governing safety and health, equal employment opportunity, labor and employment standards.
Employer groups also are critical of an executive order issued by Obama on Jan. 30. The order reverses a Bush directive that required employers to post notices informing workers of their right not to join a union under the Supreme Court’s 1988 Communication Workers v. Beck decision.
AGC has concerns with the "vague language" of the executive order and the "severe remedies" for punishing firms that don’t comply, says AGC’s Denise Gold, associate general counsel for labor and employment law. According to Gold, those remedies include possible debarment, far more punitive than called for in existing policy.
The Obama posting order requires the secretary of labor to develop a proposal to take through the rule-making process. Both ABC and AGC intend to file comments, they say.
However, no rule can be proposed until a new labor secretary is confirmed. The nomination of Obama’s pick, Hilda Solis, has run into a stumbling block, with critics contending she evaded answering questions on controversial subjects such the Employee Free Choice Act, organized labor’s top legislative priority, during her confirmation hearing before the Senate labor committee. The proposed legislation would make it easier for unions to organize. Elections could be held without a secret ballot, which critics say could intimidate workers who don’t wish to join a union.
The panel’s vote on her nomination has been postponed "to allow members additional time to review the documentation submitted to support" Solis’ nomination, Committee Chairman Edward Kennedy (D-Mass.) and ranking member Michael Enzi (R-Wyo.) said in a joint statement. Questions also have been raised about her upaid work as a treasurer for American Rights at Work, a pro-labor organization.