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Bid Protests Offer a Way Around PLAs, But Will a Slow, Steady Precedent Win the Day?
The second Trump administration has a problem with the Biden-era mandate to have project labor agreements setting compensation and work rules on federal and federally-funded projects valued at $35 million or more.A project labor agreement is a pact between craft workers and contractors that sets standards for wage rates and rules for hiring and dispute resolution that proponents say offer better cost and schedule predictability and ability to hire more high-skilled employees. Unions, and federal owners traditionally, like the arrangements because they generally standardize the hard work of organizing jobsites and contractor work for large government projects. Opponents contend PLAs can reduce competition and innovation by tending to exclude nonunion craft workers, if their employers decline to accept set pay rates or rules requiring work referrals through organized labor hiring halls and allowing dues to fund political activity. The rate of union membership in construction reached a new low in 2023, according to the Bureau of Labor Statistics, of just 10.3% of the industry.Officials now running the U.S. Dept. of Defense and U.S. General Services Administration told staff via memos that they would not demand use of PLAs. Those memos were challenged by North America’s Building Trades Unions, the umbrella group that represents 14 building trades, which won a preliminary injunction in May to reinstate the agreement mandate. The new administration is clearly trying to avoid openly defying organized labor, whose rank-and-file, and some leaders, have shown support for President Trump and U.S. Labor Secretary Lori Chavez-DeRemer, the latter endorsed by the union group. But the administration also has broad support from contractor business groups such as both majority nonunion construction groups,
the Associated General Contractors of America and the Associated Builders and Contractors. The PLA debate puts administration officials in the awkward position of publicly supporting the labor mandate, as Office of Management Budget Director Russell Vought did in a June memo, while still trying to find a way around them.Vought instructed federal agencies to return PLA language to their contracts, but also to take complete advantage of bid protest strategies that could lead to the same outcome as in an AGC case in which a federal claims court judge removed the pacts from the U.S. Army Corps of Engineers and other projects. The OMB memo instructs federal agencies to maintain the labor pact requirements but also points to a Federal Acquisition Rule provision that provides an exception to the PLA requirement for large construction projects when its use would substantially reduce the number bidders and impact the price. But it has left neither contractor groups nor NABTU happy. “To that extent this isn’t what we hoped for, it is definitely better than what was in place with the Biden administration,” Brian Turmail, vice president of public affairs & workforce at AGC
told ENR. “In addition, given the recent court decisions, it is hard to see how the administration will be able to impose a mandated PLA without facing successful bid protests.”But the grounds for overturning a PLA mandate don’t need be based on federal project costs, a federal procurement rule recommendation or agency memos. Contractor group ABC has quietly based its challenge to the PLA mandate on First Amendment right of association outside of Washington, D.C., in a case brought by its Jacksonville, Fla., chapter, ABC Florida First Coast Chapter and ABC National vs. General Services Administration. It invokes a 2018 case precedent Janus vs. AFSCME, in which Illinois school teacher Mark Janus successfully argued that his union dues to the American Federation of State County and Municipal Employees should not support its political activities or it would risk violating his First Amendment right to free speech in compelling those funds to be used to support speech with which he does not agree.In ENR’s coverage at the time, NABTU President Sean McGarvey openly said that collective bargaining costs were being paid with member dues and that’s what made them necessary. “We just think It’s a terrible decision,”he said at the time. “There are real costs in administering collective bargaining and somebody has to pay those costs, and there was a fair and equitable system set up.”McGarvey claimed the First Amendment was a “non-issue,” but the Supreme Court’s 5-4 majority ruling, which included current Chief Justice John Roberts and Associate Justices Clarence Thomas, Samuel Alito and Neil Gorsuch, said Janus’ political speech rights were violated. This bolsters ABC’s argument that nonunion contractors should not have to pay union dues for collective bargaining that neither benefits them nor could generate a desirable outcome for them. In an amicus brief in the current labor pact challenge, the National Right to Work Legal Defense Foundation, which represented Janus, wrote: “Under the PLA Rule at issue, to work on federal construction projects valued at more than $35 million, nonunion employees will have to accept unwanted union representation; pay union dues in non-right-to-work states, obtain referrals from union hiring halls; work under unfamiliar and inefficient union work rules; and have portions of their compensation diverted to union pension plans from which they will receive no benefits.”The language is so similar to the argument in Janus that it could have been copied and pasted. The ABC case is now before the U.S. Appeals Court in Atlanta, and if that court agrees with the contractor group, a Supreme Court majority could decline any appeal even in the unlikely event that Trump[-appointed GSA officials challenge the appellate court after it has solved their PLA problem for them.Bid protests might offer short-term resolution to an administration loathe to start a labor fight, but it’s hard to see a Supreme Court with Roberts, Alito, Thomas and Gorsuch now joined by Associate Justice Brett Kavanaugh siding with labor on the issue, although retired Associate Justice Anthony Kennedy joined the Janus majority in 2018. Even Associate Justice Amy Coney Barrett has sided with speech rights in similar cases. A Janus-related resolution offers a way forward for the building trades as well. Dues from 10.3% of the construction workforce in the U.S. still make up a considerable sum. Use those funds to organize jobsites and workplaces from the ground up, not for the costs of collective bargaining or as legal fees to force workers on federal projects into the fold. Jeff Yoders is ENR associate technology and equipment editor.
The second Trump administration has a problem with the Biden-era mandate to have project labor agreements setting compensation and work rules on federal and federally-funded projects valued at $35 million or more.
A project labor agreement is a pact between craft workers and contractors that sets standards for wage rates and rules for hiring and dispute resolution that proponents say offer better cost and schedule predictability and ability to hire more high-skilled employees. Unions, and federal owners traditionally, like the arrangements because they generally standardize the hard work of organizing jobsites and contractor work for large government projects.
Opponents contend PLAs can reduce competition and innovation by tending to exclude nonunion craft workers, if their employers decline to accept set pay rates or rules requiring work referrals through organized labor hiring halls and allowing dues to fund political activity. The rate of union membership in construction reached a new low in 2023, according to the Bureau of Labor Statistics, of just 10.3% of the industry.
Officials now running the U.S. Dept. of Defense and U.S. General Services Administration told staff via memos that they would not demand use of PLAs. Those memos were challenged by North America’s Building Trades Unions, the umbrella group that represents 14 building trades, which won a preliminary injunction in May to reinstate the agreement mandate.
The new administration is clearly trying to avoid openly defying organized labor, whose rank-and-file, and some leaders, have shown support for President Trump and U.S. Labor Secretary Lori Chavez-DeRemer, the latter endorsed by the union group.
But the administration also has broad support from contractor business groups such as both majority nonunion construction groups,
the Associated General Contractors of America and the Associated Builders and Contractors. The PLA debate puts administration officials in the awkward position of publicly supporting the labor mandate, as Office of Management Budget Director Russell Vought did in a June memo, while still trying to find a way around them.
Vought instructed federal agencies to return PLA language to their contracts, but also to take complete advantage of bid protest strategies that could lead to the same outcome as in an AGC case in which a federal claims court judge removed the pacts from the U.S. Army Corps of Engineers and other projects.
The OMB memo instructs federal agencies to maintain the labor pact requirements but also points to a Federal Acquisition Rule provision that provides an exception to the PLA requirement for large construction projects when its use would substantially reduce the number bidders and impact the price. But it has left neither contractor groups nor NABTU happy.
“To that extent this isn’t what we hoped for, it is definitely better than what was in place with the Biden administration,” Brian Turmail, vice president of public affairs & workforce at AGC
told ENR. “In addition, given the recent court decisions, it is hard to see how the administration will be able to impose a mandated PLA without facing successful bid protests.”
But the grounds for overturning a PLA mandate don’t need be based on federal project costs, a federal procurement rule recommendation or agency memos. Contractor group ABC has quietly based its challenge to the PLA mandate on First Amendment right of association outside of Washington, D.C., in a case brought by its Jacksonville, Fla., chapter, ABC Florida First Coast Chapter and ABC National vs. General Services Administration. It invokes a 2018 case precedent Janus vs. AFSCME, in which Illinois school teacher Mark Janus successfully argued that his union dues to the American Federation of State County and Municipal Employees should not support its political activities or it would risk violating his First Amendment right to free speech in compelling those funds to be used to support speech with which he does not agree.
In ENR’s coverage at the time, NABTU President Sean McGarvey openly said that collective bargaining costs were being paid with member dues and that’s what made them necessary. “We just think It’s a terrible decision,”he said at the time. “There are real costs in administering collective bargaining and somebody has to pay those costs, and there was a fair and equitable system set up.”
McGarvey claimed the First Amendment was a “non-issue,” but the Supreme Court’s 5-4 majority ruling, which included current Chief Justice John Roberts and Associate Justices Clarence Thomas, Samuel Alito and Neil Gorsuch, said Janus’ political speech rights were violated. This bolsters ABC’s argument that nonunion contractors should not have to pay union dues for collective bargaining that neither benefits them nor could generate a desirable outcome for them.
In an amicus brief in the current labor pact challenge, the National Right to Work Legal Defense Foundation, which represented Janus, wrote: “Under the PLA Rule at issue, to work on federal construction projects valued at more than $35 million, nonunion employees will have to accept unwanted union representation; pay union dues in non-right-to-work states, obtain referrals from union hiring halls; work under unfamiliar and inefficient union work rules; and have portions of their compensation diverted to union pension plans from which they will receive no benefits.”
The language is so similar to the argument in Janus that it could have been copied and pasted. The ABC case is now before the U.S. Appeals Court in Atlanta, and if that court agrees with the contractor group, a Supreme Court majority could decline any appeal even in the unlikely event that Trump[-appointed GSA officials challenge the appellate court after it has solved their PLA problem for them.
Bid protests might offer short-term resolution to an administration loathe to start a labor fight, but it’s hard to see a Supreme Court with Roberts, Alito, Thomas and Gorsuch now joined by Associate Justice Brett Kavanaugh siding with labor on the issue, although retired Associate Justice Anthony Kennedy joined the Janus majority in 2018.
Even Associate Justice Amy Coney Barrett has sided with speech rights in similar cases.
A Janus-related resolution offers a way forward for the building trades as well. Dues from 10.3% of the construction workforce in the U.S. still make up a considerable sum. Use those funds to organize jobsites and workplaces from the ground up, not for the costs of collective bargaining or as legal fees to force workers on federal projects into the fold.
Jeff Yoders is ENR associate technology and equipment editor.
