The Dismal Future of Construction Industry Multiemployer Pension Plans
A new report shining light on the dreadful health of multi-employer pension plans (MEPPs) for U.S. union workers and retirees estimates such plans are only 52 percent funded, with a $369 billion shortfall. MEPPs in the construction industry are responsible for a significant amount of pension shortfalls.
Construction MEPPs are responsible for about $167 billion (or 47 percent) worth of PBGC-insured MEPP underfunding. Abd it could get worse. Fifty-five percent of the 1,488 MEPPs insured by the PBGC are in the construction industry. The largest number of employees from any industry, about 3.885 million or 37.4 percent of all PBGC-insured MEPP participants (workers and retirees), are from the construction industry.
Reduced Competition Increases Costs
One fundamental economic principle is rarely wrong: Reduced competition increases costs. It is a fairly intuitive premise. Unfortunately, some government officials (often controlled by special interests) fail to grasp this basic economic concept. They often unwittingly—or even worse, knowingly—implement policies that unfairly cater to special interests or address both legitimate and erroneous public policy concerns at the [...]
Another PLA Myth Busted: PLAs Fail to Prevent Strikes on NYC Projects
Construction unions market project labor agreements (PLAs) to public and private construction owners as a tool to guarantee labor peace on construction projects. But recent examples of strikes on PLA projects in NYC and other areas across the U.S. call into question the value of these anti-competitive schemes designed steer contracts to union contractors and union members. MYTH: [...]
WSJ Editorial: Government-mandated PLAs “Deserve to be Outlawed”
The title says it all and we completely agree! The editorial board at The Wall Street Journal has again come out against wasteful and discriminatory government-mandated PLAs. Here are the highlights from the editorial (“Project Labor Revolt: The states ban union political bid-rigging. Obama demurs,” 7/19/11): One benefit of the squeeze on state and local [...]
House Legislation Will Create Fair and Open Competition for Federal Construction Contracts
On Wednesday, Feb. 16, Congressman John Sullivan (R-Okla.) introduced the Government Neutrality in Contracting Act (H.R. 735) (pdf). The legislation will protect taxpayers and ensure fair and open competition on government construction contracts by prohibiting the government from mandating anti-competitive and costly project labor agreements (PLAs) on federal and federally assisted construction projects. The Government Neutrality in [...]
Do Project Labor Agreements Ensure Compliance with Labor Laws?
It is a myth that anti-competitive government-mandated project labor agreements (PLAs) — schemes public officials beholden to Big Labor’s special interests execute to funnel lucrative public construction contracts to unionized contractors and union members in return for continued political support — ensure compliance with labor and employment laws and regulations.
An audit found violations by 55 contractors working on a $150 million Los Angeles Unified School District high school under construction in San Fernando, Calif., subject to a government-mandated PLA. The violations include failure to pay prevailing wages and inadequate supervision of apprentices. Four of the contractors had expired or suspended licenses.
The audit results demonstrate contractors working under a government-mandated PLA violate labor laws, yet PLA proponents frequently perpetuate the myth that a PLA prevents labor law infractions on PLA projects. This example shows how the presence of a PLA does little to ensure compliance with labor laws and the arguments in support of PLA mandates are weak.
Project Labor Agreements and Big Labor Fail at Local Job Creation
Big Labor bosses and government-mandated project labor agreement (PLA) advocates frequently claim that PLAs are the only way to guarantee local hire on construction projects funded by tax dollars. Of course, this is another myth promoted by special interests to convince lawmakers and taxpayers that there is a public benefit to anti-competitive and costly PLA [...]
The Most Infamous PLA Job: Lessons from Boston’s Big Dig
Boston newspaper editorials point out that Mass. Gov. Deval Patrick’s recent use of PLA mandates in exchange for Big Labor’s support during November’s gubernatorial election makes little fiscal sense for Mass. taxpayers and stinks of political favoritism – especially considering the $22 billion Big Dig’s well-documented record of missed deadlines, cost-overruns, construction defects (including a motorist fatility due to a collapsed tunnel ceiling panel), and reports of union workers visting methadone clinics, sleeping and drinking heavily on the job.
Funded by federal and Massachusetts taxpayers, the Big Dig is the most expensive and infamous government-mandated PLA job of all time.
Understanding the Merit Shop Contractor Cost Advantage
One of the biggest complaints against government-mandated project labor agreements (PLAs) is that these anti-competitive schemes saddle nonunion and merit shop contractors with inefficient union work rules and high operational costs unique to unionized contractors, which results in reduced competition and increased costs to taxpayers. Studies have found that these costly inefficiencies, coupled with reduced [...]
PLA Final Rule Takes Effect Today: Let the Waste, Cronyism and Discrimination Begin
Learn how the FAR Council’s regulations implementing President Obama’s pFeb. 6, 2009 ro-PLA Executive Order 13502 will lead to increased costs, reduced competition, unemployment in the construction industry and waste and cronyism in federal construction contracting.