Now that President Donald Trump has been sworn into office, the construction sector is eager to see whether the new administration scales back regulations to the degree it promised. The industry has already taken steps in drawing attention to its own specific concerns, including a past Executive Order by President Barack Obama regarding project labor agreements (PLAs).
A coalition of industry associations, including the Associated Builders and Contractors (ABC) and Associated General Contractors (AGC), along with the U.S. Chamber of Commerce, sent a letter to Trump last week requesting he rescind Obama’s Executive Order 13502. The order encourages federal agencies to require PLAs on federal construction projects that exceed $25 million in total value.
In the letter, the coalition claims the policy “discourages competition and results in delays, waste and favoritism during the procurement of taxpayer-funded construction projects.”
“As you know from your extensive real estate and construction experience, a PLA is a collective bargaining agreement unique to the construction industry that typically requires companies to agree to recognize unions as the representatives of their employees on that job, use the union hiring hall to obtain workers, follow union work rules and pay into union benefit and multi-employer pension plans that nonunion employees will be unlikely to access,” the group writes. “This forces employers to pay ‘double benefits’ into existing plans and union plans and places firms opposed to these costly provisions at a significant competitive disadvantage. In addition, PLAs typically force construction workers to pay union dues or join a union if they want to receive union benefits and work on a PLA project.”
The coalition claims that when mandated by government agencies, “PLAs can interfere with existing union collective bargaining agreements and unfairly discourage competition from nonunion contractors and their employees,” which the group says comprises 86.8 percent of the U.S. private construction workforce, citing Bureau of Labor Statistics data. The coalition adds that PLA mandates increase construction costs between 12 to 18 percent, and that “recent government-mandated PLAs on federal and federally assisted projects have resulted in litigation, reduced competition, increased costs, needless delays and poor local hiring outcomes.”
The associations request the Executive Order is rescinded to “create a level playing field in the procurement of government construction contracts, increase competition, help small businesses grow, curb construction costs and spread the job-creating benefits of federally funded contracts throughout the entire construction industry.”
This is one of many issues industry associations are pressing Trump on. Others include the Occupational Safety and Health Administration’s (OSHA) updated silica rule and the Department of Labor’s revised overtime rule, as well as OSHA’s electronic recordkeeping rule and Obama’s Fair Pay and Safe Workplaces Executive Order. AGC lays out these arguments in its 51-page “Make Federal Agencies Responsible Again” plan.