SMACNA is urging the U.S. House of Representatives to support President Biden's Final Rule/Executive Order (E.O. 14063) regarding the use of Project Labor Agreements on Federal Construction Projects that are open to Non-Union and Union Contractors. SMACNA supports the appropriate use of construction project labor agreements (PLAs) on public construction and strongly supports their federal construction contract use. The Biden Administration EO gives government owners the flexibility to use PLAs when appropriate for federal construction projects exceeding $35 million with certain exemptions. It would also boost the skilled labor workforce and direct the Labor and Defense departments and OMB to create a strategy to train federal contract officers to implement the order. SMACNA supports using PLAs on these projects when these endeavors exceed $35 million (with certain exceptions).
"This updated rule will help ensure that large-scale federal projects are completed professionally and timely while also supporting highly skilled and paying jobs," said Aaron Hilger, Chief Executive Officer at SMACNA. "Importantly, this rule levels the playing field by allowing all union and non-union contractors to bid using the same high-quality workforce standards. These new construction rules were needed to counter a skill shortage created by too many industry firms and organizations that badly shortchanged the industry's obvious workforce needs for decades, not political calculations."
Key facts behind SMACNA's support of the Administrations Final Rule/Executive Order:
1. PLAs are most often used in the private sector, where corporate budget and scheduling decisions are highly scrutinized: PLAs are valued by experienced and cost-conscious owners and construction contractors in the private sector, large and small, pro-union and anti-union. This has been true in the private sector for over 100 years. Private and public-sector PLAs offer a valued and systematic process for methodical planning and scheduling to ensure cost-effective construction projects, allowing more accurate bidding and lower costs. Simply put, they work.
2. Public sector PLAs do not discriminate against nonunion construction contractors or workers: In the private sector, owners are free to select union-only PLAs to build their projects, taking advantage of more skilled workers as an economic benefit. However, on public projects, once a PLA has been negotiated, both union and nonunion contractors are free to bid on the work as they do on any other construction projects. Negotiated government PLAs allow nonunion firms to bring their own top employees without discrimination. Federal PLAs are open to all bidders, as PLA opponents know.
3. PLAs help local communities boost registered apprenticeship programs and the skilled labor workforce at a time of historic shortages and allow for workforce screening and background credentialing for added project security: PLAs benefit the local community by guaranteeing skill training and work opportunities to the local workforce on each complex public construction project. The hiring hall process, which cannot discriminate against nonunion workers, creates the benefit of project security screening, an important government priority for all federal government projects, especially defense, homeland security, and other federal infrastructure facilities.
SMACNA's reasons for supporting the President's action are:
- PLAs are valuable tools for private and public sector PLAs. They offer a practical and systematic process for methodical planning and scheduling to ensure cost-effective construction projects, allow more accurate bidding, and lower costs.
- Under Federal PLAs' terms, unions and non-unions can bid for work governed by this framework.
- During historic shortages, PLAs help local communities boost registered apprenticeship programs and the skilled labor workforce. They also allow for workforce screening and background credentialing for added project security. PLAs benefit the local community by guaranteeing skill training and work opportunities to the local workforce on each complex public construction project.
SMACNA firmly believes that PLAs should be leveraged to benefit both the project owner and the American taxpayer and ensure maximum project transparency and value. The President's recent executive order enables the fulfillment of those objectives. Additionally, SMACNA also sent a letter to the Chair and Ranking Member of the House Subcommittee on Cybersecurity, Information Technology, and Government Innovation, supporting the adoption of the final rule regarding PLAs. In addition to the benefits to taxpayers and project leads, the President's Executive Order will help address the skilled labor shortage generated by an insufficient commitment to registered apprenticeship programs. These steps will help ensure that high-quality skilled labor is available for the growing number of projects generated by SMACNA-supported legislation, such as the Inflation Reduction Act, the CHIPS and Science Act, and the Bipartisan Infrastructure Law.
In addition to SMACNA's outreach, the Construction Employers of America (CEA), which SMACNA is a part of, entered submitted comments for the record on the issue during a recent hearing regarding PLAs. The CEA letter detailed how three presidential administrations have determined the value of PLAs in promoting quality, efficiency, and economy during taxpayer-funded construction projects. The testimony also detailed how PLA's have been successfully used to manage private-facing projects.
Click here to read SMACNA's Letter to the House of Representatives Regarding using PLA's on Federal Construction Projects. Also, click here to read SMACNA's letter to the House Subcommittee on Cybersecurity, Information Technology, and Government, and click here to read CEA's testimony.
