Executive order on project labour could inflate costs in US

By Catrin Jones08 February 2022

Picture courtesy of White House

Objections have been raised over President Biden’s new executive order (EO) which imposes project labour agreements (PLAs) on federal construction projects in the US. 

US contractor organisations argued that the order will inflate construction costs and discriminate against the majority of workers in the country, in addition to undermining existing collective bargaining agreements.

PLAs control the terms and conditions of employment of workers on specific construction projects. These include wages, hours, working conditions, dispute resolution methods, and banning work stoppages and strikes.

Stephen E. Sandherr, chief executive officer of the Associated General Contractors of America (AGC), said; “Government-mandated project labour agreements undermine the collective bargaining process by imposing a separate agreement in a specific region that applies only to a limited number of construction firms and unions.

“These imposed PLAs undercut the benefits of the collective bargaining agreements that were negotiated in good faith between employers and labour unions and will likely prompt many firms to think twice about participating in the bargaining process in the future.

“Imposing project labour agreements also discriminates against the more than 85% of construction workers who choose not to belong to a union. That is because open shop firms that are subjected to a project labour agreement are required to pay both their employees’ benefits and those of the unions involved in the agreement.”

The National Utility Contractors Association (NUCA) also have strong objections against the new executive order released by the Biden Administration, saying they would increase existing workforce capacity challenges by the industry in addition to putting further strain on the increasing skills shortage.

“NUCA represents both union and merit shop contractors,” said Doug Carlson, NUCA CEO. “Our members build and maintain all underground utility systems. We’re doing everything possible to combat the enduring workforce challenges facing our industry, but the Biden EO released last night does nothing but make matters much worse.”

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