An Ohio lawmaker is offering a simple change to state law that could save 20 percent on building projects and give more companies a chance to compete for work with the state and local governments.
State Rep. Ron Young (R-Leroy) is the prime sponsor of a bill that would do away with a state-level requirement for Project Labor Agreements, or PLAs, on all publicly funded construction projects. Those agreements are essentially collective bargaining deals signed with one or more labor organizations to establish the terms and conditions of employment for a specific construction project.
Most PLAs require all employers to pay union dues and contribute to union pension and health benefit plans on behalf of their workers whether they’re a union shop or not. It is this aspect that has some opponents calling PLAs ‘forced unionization.’
‘It’s Blatantly Unfair’
Young says state agencies should be required to review each proposal without discriminating, and he sees PLAs as discrimination in favor of a specific group—in this case, unions.
“For anyone to say you have to be a member of certain group to participate—whether it’s Elks or Masons or unions—it’s just wrong,” he said.
“It’s blatantly unfair,” he continued. “These are all public dollars, and we’re talking about taxpayers. Every taxpayer should have the opportunity to bid on public jobs.”
Robert L. Balgenorth, president of the State Building and Construction Trades Council of California, describes PLAs in benign terms, noting, “A large project involves many separate union and nonunion contractors, each with its own schedule of starting times, holidays, and other ancillary work rules. A PLA coordinates these differences,” he said.
But opponents, such as Eric Christen, executive director of the Coalition for Fair Employment in Construction (CFEC), say PLAs are “highly discriminatory, anti-taxpayer agreements that unions have placed on certain construction projects around the state.”
“Their purpose is twofold: gain back lost market share by implicitly keeping nonunion contractors from wanting to work on these projects and, secondly, to boost their pension funds with the dollars put into them by the few nonunion contractors who might actually sign onto a PLA,” Christen said.
According to the Bureau of Labor Statistics, only 13.2 percent of the private construction workforce is in a union.
The fight has played out at the federal level, too. The National Labor Relations Act prohibits pre-hire agreements on everything except construction projects.
President George W. Bush issued an executive order stating the federal government and agencies using federal funds could not “require or prohibit” construction contractors to sign union agreements as a condition of doing work.
But 17 days after being sworn in, President Barack Obama rescinded that, issuing a new order saying federal agencies could require PLAs on projects of $25 million or more, and nonunion contractors that bid on such projects have to agree to the PLA if they win the bid.
Ohio Lawsuit Over PLAs
In Ohio, the use of PLAs for school construction projects ended up in court. In October 2010 the 1851 Center for Constitutional Law sued then-Gov. Ted Strickland, Ohio School Facilities Commission (OSFC) Executive Director Richard Murray, and several others alleging violations of Ohio’s RICO law.
Among other things, the suit claimed Murray pressured school districts into using PLAs for their school building projects, rewarding those that did and retaliating against those that didn’t.
On February 24, 2011, the OSFC passed a resolution that:
- prohibited the use of Prevailing Wage on state-funded school projects;
- prohibited the use of PLAs on state-funded school projects; and
- committed OSFC to the belief that “open contracting for publicly funded construction projects aids in lowering costs of such projects.
Lawmakers Stepped In
With the passage of the resolution, the 1851 Center dropped its lawsuit, but the Ohio General Assembly had already gotten involved. H.B. 102 and S.B. 89 were both introduced that same month to address the use of PLAs throughout the state.
The bills were similar, with language that state agencies and political subdivisions could neither require nor prohibit certain labor agreements as a condition of getting a bid. Both prohibited the use of state funds if a PLA were required or prohibited.
S.B. 89 was assigned to a committee, but no action was taken. H.B. 102 was passed by the Commerce and Labor Committee in May 2011, but it received no further action.
Rep. Young said the law would give the state more bidders to choose from and reduce the price of public projects by as much as 20 percent.
Fewer Terms, Conditions
Young noted Ohio law still requires the payment of prevailing wages in the area in which the project is sited, so the lack of a PLA won’t lower the wages paid on public projects.
“But you don’t have other costly terms and conditions,” he said, referencing such items as who can push a wheelbarrow or “how many electricians must be present to screw in a light bulb.”
Arkansas, Arizona, Georgia, Idaho, Iowa, Kansas, Louisiana, Maine, Michigan, Mississippi, Missouri, Montana, Oklahoma, North Dakota, Tennessee, and Utah have all banned government-mandated PLAs.
Maggie Thurber ([email protected]) owns Corsair Communications and is a contributor to Ohio Watchdog. Used with permission of Watchdog.org.