What is a Project Labor Agreement (PLA)?
A project labor agreement (PLA) is a construction labor agreement between an owner and a regional building trades council, representing all the construction craft unions in a given geographical area. PLAs are agreements that establish uniform terms and conditions for all construction craft employees, as well as all construction contractors on a specific construction project. Each PLA is specific to one project only and are typically referenced in bid specifications for a project and are negotiated before employees are hired for the project.
A typical PLA will establish uniform standards for working hours, overtime, holidays, grievance procedures, drug testing, jurisdictional dispute resolution, etc. These are areas that generally differ from craft to craft, and from contractor to contractor on a typical construction project, and it is the responsibility of the owner, or of its construction manager, to coordinate the project as efficiently as possible.
Frequently Asked Questions
When are PLAs used?
PLAs are particularly useful on large, complex construction projects that require many skilled craft workers, and that are expected to last a long period of time, and on projects that are particularly time-sensitive.
Do PLAs raise the cost of construction?
PLAs do not increase the cost of construction. A PLA is a comprehensive agreement between the unions and an owner, which establishes uniform standards to which all participants in the construction process must conform.
A PLA establishes a wage level for all crafts contributing to the project, but this is only one part of a PLA. Wages only represent a fraction of the overall cost of construction. Many other factors are as important to the overall cost of a project, including efficiency and quality of construction.
While PLAs cannot eliminate delays in construction, an ironclad no-strike, no-work stoppage agreement can eliminate any delays attributable to labor and will supersede any collective bargaining agreements could expire or strikes that could potentially stop construction in each area for weeks at a time. PLAs offer an opportunity for union and nonunion workers to work side-by-side on a project in harmony.
Why do PLAs require hiring through union halls?
Union hiring halls present the most effective and efficient method of hiring skilled local employees. A construction owner has access to the best trained and experienced construction workers in the area through the union hiring halls. Union hiring halls provide the best assurance of employing skilled local workers, who have a stake in the overall success of the project.
How do PLAs benefit contractors?
PLAs lead to good quality work at predictable costs by providing a steady supply of skilled labor, avoiding work stoppages, and establishing uniform wages and safe working conditions.
Does a PLA constitute a “union-shop” agreement?
No, a PLA is not a “union shop” agreement. The owner determines who can bid on the project and generally bidding is open to all contractors, and employment is open to all construction craft workers. PLA’s can be most beneficial to non-union construction craft workers, as they are afforded an opportunity to work on some projects on which they may not have had the opportunity without a PLA, and on the PLA project, they will be guaranteed a fair wage.
How common are PLAs?
Billions of dollars’ worth of construction projects are built each year under Project Labor Agreements, including major projects in Minnesota.
Project Labor Agreements have been used to build: U..S Bank Stadium, 35W Bridge, TCF Bank Stadium, Target Field, Federal Courthouse, Hennepin County Government Center, Ramsey County Jail, University of Minnesota Duluth, 188th Air Guard Maintenance Building, Mall of America, St. Paul Technical College, Rondo Library, Aerial Lift Bridge, Tunnel Connection, Federal Reserve Bank, Minneapolis School District, St. Paul Public Schools, Duluth School District, Moundsview and Stillwater Schools, Anoka-Hennepin School District, Great Aquarium – Duluth, Minnesota Department of Revenue Building and numerous hospital projects.
Does a public PLA comply with Minnesota’s public bidding laws?
Yes. Minnesota’s public bidding law requires that all public construction contracts be awarded to the lowest responsible bidder. Projects with PLA’s do not discriminate against any bidders, nor do they prohibit the awarding body from awarding the contract to the lowest responsible bidder. They simply require that all bidders must adhere to the standards to which the public body has agreed in the terms of the PLA. It is then the choice of the bidder whether it chooses to bid on the project with the set standards of a PLA or to bid on other projects without a PLA. The choice lies entirely with the bidder.