Biden Administration Executive Order Requires Project Labor Agreements with Unions on Certain Federal Construction Projects

A undertaking labor settlement (PLA) is a collective bargaining settlement between a contractor and the constructing commerce union on a selected building undertaking. PLAs are negotiated earlier than any staff are employed, they usually set up the phrases of employment on a undertaking. Executive Order (EO) 14063, issued by the Biden administration on February 2, 2022, requires PLAs on “large-scale construction projects,” outlined as Federal building tasks inside america for which the entire estimated value of the development contract to the Federal Authorities is at the least $35 million.

IN DEPTH

EO 14063 offers that PLAs should embody particular phrases. PLAs should (a) enable all contractors and subcontractors on the undertaking to compete for undertaking work whether or not or not they’re in any other case unionized; (b) comprise ensures in opposition to strikes, lockouts and comparable job disruptions; (c) set up mutually binding dispute decision strategies; (d) present different mechanisms for cooperation between labor and administration; and (e) totally conform to all statutes, rules, govt orders and presidential memoranda.

All contractors and subcontractors that work on the development undertaking are topic to the PLA, and its phrases supersede any of their current collective bargaining agreements. Though the PLA binds all events and applies to all staff on the development undertaking, it doesn’t require that the contractor itself unionize.

Notably, the EO permits a “senior official” inside an company the discretion to grant exceptions to the requirement for PLAs when:

  • Requiring a PLA on the undertaking wouldn’t advance the Federal Authorities’s pursuits in reaching economic system and effectivity in Federal procurement based mostly on sure specified components;

  • Primarily based on market evaluation, requiring a PLA on the undertaking would considerably cut back the variety of potential bidders to frustrate full and open competitors; or

  • Requiring a PLA on the undertaking would in any other case be inconsistent with statutes, rules, govt orders or presidential memoranda.

EO 14063 is a major leap from EO 13502, a 2009 Obama administration EO that merely “encourage[d]” Federal companies to mandate PLAs on large-scale building tasks. A remaining rule implementing EO 13502, efficient as of Could 13, 2010, granted Federal govt companies discretion to require use of PLAs on a project-by-project foundation. EO 14063 revokes EO 13502 as of the efficient date of the implementing remaining rules.

WHAT HAPPENS NOW?

The Federal Acquisition Regulatory Council has 120 days to suggest rules implementing EO 14063.

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