Biden Signs Executive Order Barring Non-Union Construction Workers From Federal Construction Projects Over $35 Million
So-called "Project Labor Agreements" effectively bar 87% of construction workers from doing government projects
* UPDATED
WASHINGTON, DC—In furtherance of his vow to be the most “pro-union President in U.S. history,” President Joe Biden signed an Executive Order on Friday to require so-called “Project Labor Agreements” on all federal construction projects above $35 million.
The order, which will go into effect immediately, comes on the heels of a $1 trillion infrastructure bill signed into law by Biden that invests in the country’s roads, ports and bridges, reports NBC News.
A "project labor agreement" is when the government awards contracts for public construction projects exclusively to unionized firms, according to one source.
A project labor agreement requires all contractors, whether they are unionized or not, to subject themselves and their employees to unionization in order to work on a government-funded construction project. This is done by including a union collective bargaining agreement in a public construction project’s bid specifications. In order to receive a contract, a contractor must sign the agreement and subject its employees to union control.
According to a White House fact sheet, “this Order could affect $262 billion in federal government construction contracting and improve job quality for the nearly 200,000 workers on federal construction contracts.”
Executive Order Praised by Association of Union Constructors
“This streamlines the negotiation process and gives employers access to a highly skilled pool of craftworkers,” Daniel Hogan, chief executive of the Association of Union Constructors, that represents 1800 contractor companies, told Reuters.
However, given that 87 percent of the U.S. construction industry is not unionized, President Biden’s Executive Order is not sitting well with other construction trade associations.
Associated Builders and Contractors ‘Blasts’ Biden’s Executive Orders
“President Biden’s new policy will not help America ‘Build Back Better;’ instead, it will exacerbate the construction industry’s skilled workforce shortage, needlessly increase construction costs and reduce opportunities for local contractors and skilled tradespeople,” said Ben Brubeck, vice president of regulatory, labor and state affairs for the Associated Builders and Contractors in a statement. “This anti-competitive and costly executive order rewards well-connected special interests at the expense of hardworking taxpayers and small businesses who benefit from fair and open competition on taxpayer-funded construction projects.”
“Research has demonstrated that government-mandated PLAs increase construction costs by 12% to 20%, which results in fewer construction projects and improvements to roads, bridges, utilities, schools, affordable housing and clean energy projects—and the creation of fewer jobs,” said Brubeck. “PLAs steer contracts to unionized contractors and workers at the expense of the best-quality nonunion contractors and workers who want to compete fairly at a price best for taxpayers.
Associated General Contractors of America CEO says Biden EO will ‘Discriminate’ against most construction workers
“It is hard to explain why the President would choose to impose government mandated project labor agreements to solve a problem that doesn’t exist, AGC CEO Stephen E. Sandherr said in a statement. “Construction workers are among some of the highest paid workers in the economy, earning ten percent more than the average worker in the U.S. Their pay rates have continued to climb 5.1 percent as labor shortages have made this a workers’ market.”
““Imposing project labor agreements also discriminates against the more than 85 percent of construction workers who choose not to belong to a union,” Sandherr stated. “That is because open shop firms that are subjected to a project labor agreement are required to pay both their employees’ benefits and those of the unions involved in the agreement. Since few firms can be competitive while paying two sets of benefits, the order effectively locks out most workers from participating in federal construction projects.”
The White House said Biden would visit Ironworkers Local 5 in Upper Marlboro, Maryland, Friday to sign the new executive order, joined by Vice President Kamala Harris and Labor Secretary Marty Walsh, according to Reuters.
UPDATE:
“It’s excellent news for the nation’s middle-class and working people,” Gary LaBarbera, president of the Building and Construction Trades Council of Greater New York, said in a statement to LaborPress. “PLAs are the foundation and cornerstone of middle-class careers with benefits in the construction industry, ensuring workers who lead these consequential projects are highly skilled and paid a fair wage. Importantly, PLAs also help guarantee that projects are completed on-time and within budget, protecting both taxpayers and the integrity of the public trust. President Biden continues to make historic investments and commitments to the nation’s working people.”
Editor’s note: This story will be updated.