A project labor agreement (PLA) is a special interest scheme that discourages competition from nonunion contractors and their workers by requiring a construction project to be awarded only to contractors and subcontractors that agree to recognize unions as the representatives of their employees on that job; use the union hall to obtain workers; obey the union’s restrictive apprenticeship and work rules; and contribute to union pension plans and other funds in which their nonunion employees will never benefit unless they join a union.
If mandated on public construction projects in North Dakota, PLA requirements would make it nearly impossible for the more than 90 percent of North Dakota’s construction workforce that chooses not to join a labor union to compete for projects funded by their own tax dollars.
Government-mandated PLAs can occur in Right to Work states, though they are less common. Although Right to Work laws prevent workers from being forced to pay dues to a union as a condition of employment, workers in both Right to Work and non-Right to Work states are still required to work under nearly all of the terms and conditions negotiated by the union under a PLA. These provisions are enough to discourage competition from nonunion contractors and significantly increase construction costs for taxpayers.
In February 2009, President Barack Obama issued an executive order encouraging federal agencies to require PLAs on projects costing more than $25 million. This order left open the door for potential PLA mandates on both federal projects costing less than $25 million and federally assisted construction. By enacting a statute to guarantee government neutrality with regard to PLA mandates, state leaders can signal to the Obama administration that taxpayers in their state want the best construction at the best price, not special interest handouts, for their hard-earned public construction dollars.
Fourteen states have banned these Big Labor handouts on taxpayer funded construction projects in their state, with ten doing so after President Obama issued his pro-PLA executive order.
It’s time to add North Dakota to this list. Enacting this legislation will ensure that as the state grows, taxpayers are assured the best construction and the best price. It will also guarantee that the entire construction industry workforce has the opportunity to compete for projects funded by their own tax dollars.
A summary of studies on the impact of PLA mandates (online resources here)
CATO Institute: Why Project Labor Agreements Are Not In the Public Interest