Milpitas City Library Project PLA: A “Model Of Success”

1 January 12, 2010  State & Local Construction, Uncategorized

Big Labor and their allies often claim that wasteful and discriminatory project labor agreements (PLAs) guarantee that workers will be paid fair wages and ensure that contractors on covered projects follow the highest labor standards.

Nevertheless, the Taxpayers Accountability Project of Associated Builders and Contractors, California Cooperation Committee (ABC-CCC) found at least 56 violations of state labor law – including underpayment of workers, failure to follow journeyman to apprentice ratios and improper use of apprentices – on Milpitas’ $39 million City Library project.

ABC-CCC was able to uncover these violations despite the fact that this project was covered by a PLA.  City officials called this project a, “Model of success” in an October 2008 letter to the Santa Clara & San Benito Building and Construction Trade Council.

Here is an excerpt from James Spencer’s article in on the release of ABC-CCC’s audit in September 2009:

Milpitas Public Works Director Greg Armendariz wrote in a letter to the Building & Construction Trades Council that the project “was a model of success” and the Project Labor Agreement would help the construction industry work through this downturn in the economy.

Project Labor Agreements require that “union-only” contractors can bid or perform public works projects barring merit shop contractors – despite qualifications – from the opportunity to submit a project bid. The stated goal of the agreement is to ensure worker protections and project quality, as required by the Milpitas City Council.

However, the audit reveals that the 56 violations were the result of a lack of oversight of apprentice workers, which jeopardizes job quality and puts employees at risk.

The audit’s findings have been reported to the Department of Industrial Relations for review and action. ABC‐CCC investigated the 56 violations and filed formal complaints on Sept. 14 with the California Labor Commissioner’s office.

ABC‐CCC is performing audits of public works projects statewide as part of The Taxpayer Accountability Project and releasing findings to ensure that public funds are efficiently and effectively managed.

Well, ABC-CCC sent their findings to California’s Department of Industrial Relations (DIR) and it turns out ABC-CCC was right to be concerned.  DIR has notified eight of the contractors that worked on the Milpitas City Library project that they violated state labor laws.

Here’s an excerpt from ABC-CCC’s January 8 press release (our emphasis added):

Responding to the findings of a labor compliance audit conducted by the Taxpayer Accountability Project of Associated Builders and Contractors, California Cooperation Committee (ABC-CCC), the California Department of Industrial Relations has officially notified eight contractors that they violated state labor laws during construction of the $39 million Milpitas City Library Project. See the letters issued by the state at this link: Milpitas Library Labor Violations.

“Staff for the City of Milpitas reacted angrily and defensively when the Taxpayer Accountability Project submitted its findings to the Labor Commissioner in September,” Kevin D. Korenthal, executive director of Associated Builders and Contractors, California Cooperation Committee said. “The results of the independent audit were validated by the State and we are pleased that action has been taken to protect the public trust and ensure accountability by contractors on public works projects.”

Confirmed violations by contractors on the Milpitas Library Project include lack of proper ratios of journeymen to apprentices and improper use of apprentices. These infractions are significant as they could have contributed to project quality and worker safety issues. Furthermore, many contractors working on the project failed to provide records as required by law until after the audit and subsequent state inquiry.

Contractors confirmed in violation include five based in the South Bay, two others based in the Bay Area, and one based in the state of New York: Milpitas Library Labor Violations.

“Additionally, based upon the findings of ABC-CCC’s independent audit, we have reason to believe that our conclusions only scratched the surface of how labor laws were violated on this project,” Korenthal added. “Clearly, City of Milpitas officials neglected to scrutinize the project following the City Council’s vote to give construction unions a monopoly by virtue of a Project Labor Agreement.”

Additionally, James Spencer at picked up the story about DIR acting on ABC-CCC’s audit and notifying the eight contractors that labor law violations occurred on the Milpitas library.  Here is an interesting excerpt from this January 11 story:

After the story ran [the September 2009 story mentioned earlier in this post] , I received an irate e-mail from a very high-level public official in Milpitas, who was upset about our article and said that PublicCEO’s information was not accurate.

The official asked, “Do you realize we had a Project Labor Agreement?” and said that Milpitas believed no violations existed on the project. I immediately followed up with this official in regards to the e-mail, but never heard back.

Here at, we’d like to take this opportunity to respond to this unnamed Milpitas official.

Yes, we realize there was a PLA on this project and we strongly encourage you to think about the potential quality and worker safety issues that could result from restricting the ability of 80 percent of California’s construction workforce from competition for a project.

We will continue to report on PLAs that don’t live up to Big Labor’s promises on this blog.

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One Response to Milpitas City Library Project PLA: A “Model Of Success”

Paul Naude January 13, 2010 at 12:58 am

The PLA is a document which governs everyone working on the project.

When you have cases of contractors not following or adhering to the PLA it means that IR Managers, IR Co-ordinators and IR Officers from the Managing Contractors side are not performing their tasks.

That is why you have Kick-off meetings with the contractors and a strong IR Policy and IR Road ahead procedure.

Regular audits must be done to ensure all are adhering to the PLA.

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