§§ 158(e) and (f) make special exceptions from other requirements of the NLRA in order to permit employers to enter into pre-hire agreements with labor unions in the construction industry.
The use of PLAs is opposed by a number of groups,[8] who argue that the agreements discriminate against non-union contractors and do not improve efficiency or reduce costs of construction projects.
By the 1980s, nonunion contractors claimed in excess of 80% of the construction work, in a wide variety of trades, with some variation in different parts of the country.
[16] On October 23, 1992, while the Boston Harbor case was still in court, President George H. W. Bush signed Executive Order 12818 prohibiting federal agencies from exclusively contracting union labor for construction projects.
[20] One month later, in the Boston Harbor cleanup case, the United States Supreme Court unanimously upheld the use of the agreements on public projects.
Clinton abandoned the proposed executive order,[22] but issued a memorandum on June 5, 1997, encouraging federal departments to consider the use of PLAs for “large and significant” projects.
[27] In August 2001, U.S. District Court ruled Executive Order 13202 invalid in a case examining the use of a PLA by Maryland for the Woodrow Wilson Bridge replacement project.
[25] Following this decision, the Department of Defense, NASA and the General Services Administration formally recognized the order in the Federal Register and implemented it in their construction bidding processes.
[30] A notable example of pro-PLA legislation was passed in New Jersey, which enacted a law in 2002 allowing use of PLAs for some government funded projects.
Government officials and legislators have clashed over using PLA mandates on projects in states including Iowa,[36] Oregon,[37] Ohio,[38] California,[39] and others.
[7] As of March 2023, through legislation or by executive order issued by the state governor, the following 25 states have active laws banning government-mandated project labor agreements on state, state-assisted and/or local taxpayer-funded construction projects to some degree: Alabama, Arizona, Arkansas, Florida, Georgia, Idaho, Iowa, Kansas, Kentucky, Louisiana, Michigan, Mississippi, Missouri, Montana, North Carolina, North Dakota, Oklahoma, South Carolina, South Dakota, Tennessee, Texas, Utah, West Virginia, Wisconsin and Wyoming.
[63] The Biden administration is pushing state and local governments to require PLAs on federally assisted projects via more than $250 billion worth of federal agency grant programs that give grant applicants favorable treatment if PLAs are required on taxpayer-funded infrastructure projects procured by state and local governments seeking federal dollars flowing from new programs in the Infrastructure Investment and Jobs Act, the American Rescue Plan Act and other legislation passed by Congress that authorize and fund infrastructure dollars but are silent on PLA preferences and requirements.
[64] The Biden administration has also been criticized[65] for pushing PLA mandates on private construction projects receiving federal grants and tax breaks, such as pro-PLA policy contained in the U.S. Department of Commerce CHIPS Incentives Program's Commercial Fabrication Facilities[66] Notice of Funding Opportunity.
[77] According to those who support the use of such agreements, PLAs enable project owners to control costs and ensure that there are no disruptions to the construction schedule, for example from strikes.
[85] Surveys of nonunion contractors suggest that government-mandated PLAs, increase costs; reduce competition; decrease economy and efficiency in government contracting; undermine investments in workforce development programs; reduce/have no impact on project safety, quality, budget or timeliness; result in worse local hiring outcomes; and decrease hiring of women, veteran and disadvantaged business enterprises and construction workers.
[86] According to those who oppose PLAs, the agreements place restrictions on the hiring and working practices of contractors, and can lead to increased costs for project owners.
[89] Opponents also claim provisions in typical PLAs require contractors to hire apprentices only from apprenticeship programs affiliated with unions, which limits investments in employer and association government-registered apprenticeship programs not affiliated with unions[91] and may exacerbate skilled labor shortages within the construction industry expected to top half a million workers in 2023.
According to their analysis, in areas including Denver, Colorado, New Orleans, Louisiana, and Orlando, Florida, where unions do not have a great presence, use of PLAs for projects would lead to cost increases from 5% to 9%.
[6] However, in a subsequent case the Supreme Court observed the following limitation on the Boston Harbor holding, "In finding that the state agency had acted as a market participant, we stressed that the challenged action "was specifically tailored to one particular job.
[118][119] PLA opponents argue that the union control of hiring prevents a non-union contractor for using its own employees and efficient work practices.
[132][133] According to the United States Pan-Asian American Chamber of Commerce, the majority of their membership comprises small businesses that are unfairly impacted by PLAs, particularly due to increased costs and lowered employee benefits.
The article finds that while there are benefits to PLA use, they can present risks and should only be allowed on projects where they will further the goals of competitive bidding statutes, namely timely, efficient, high quality, and inexpensive construction.
[138] Studies have found that PLAs offer benefits to project owners and local communities, and do not disadvantage nonunion contractors and employees.
A 2009 study by Fred B. Kotler, J.D., associate director of the Cornell University School of Industrial and Labor Relations found that there is no evidence that PLAs discriminate against employers and workers, limit the pool of bidders, and raise construction costs.
[136] An independently reviewed 2011 study by The National University System Institute for Policy Research analyzed the cost impact of PLAs on school construction in California from 1996 to 2008.
He wrote the authors: "Although your study has several serious statistical issues, at the end of the day, your results are basically consistent with those presented in my article on PLAs and Massachusetts school construction costs.
The study authors point out in the report that they employed robust regression methods to account for variances in school construction materials/techniques and location.
The report stated that PLAs reduced the number of bidders on construction projects, and led to lower savings than would be possible where contractors are able to work under their usual arrangements for employees.
[154] In March 1995, an ABC study of the taxpayer costs for Roswell Park Comprehensive Cancer Center in Buffalo, New York, assessed bids for the same project both before and after a PLA was temporarily imposed in 1995.
[156] In March 2006, the Public Interest Institute released a study that concludes that the PLA agreed for the construction of the Iowa Events Center project in downtown Des Moines, placed an “unnecessary burden” on local workers, businesses and taxpayers.