New Obama Administration Contracting Policy "Nothing More Than Payback" to Big Labor

So-called "project labor agreements" discriminate against the 85 percent of construction workers who have opted against unionization

Washington, DC (April 13, 2010) – Today, the Office of Management and Budget (OMB) approved a policy initiated by President Barack Obama’s Executive Order 13502, encouraging federal agencies to discriminate against nonunion workers and employers by adopting so-called “project labor agreements” (PLAs) on all federal construction projects costing the taxpayers over $25 million. Mark Mix, president of the National Right to Work Legal Defense Foundation, released the following statement about the policy.

“The Obama Administration’s policy is a slap in the face to the vast majority of construction workers who have chosen not to unionize. Qualified nonunion contractors whose workers have opted against unionization will be locked out from large-scale construction projects. The true purpose of so-called project labor agreements is simple: to impose unwanted union boss control on workers from the top-down.

“Rather than encouraging a competitive and open bidding process to ensure the American taxpayers get the best deal, the White House favors using federal contracts to reward Big Labor’s political machine. The policy is nothing more than payback for the billion dollars the union bosses spent electing Barack Obama and other forced-unionism proponents in the last election cycle.”

The National Right to Work Foundation filed formal comments with the Federal Acquisition Regulation Council last summer opposing the proposed rule. The Foundation argued that the directive is illegal under the National Labor Relations Act, and that imposing discriminatory PLAs on federal contractors violates workers’ rights, passes along higher costs to taxpayers, and serves no purpose other than to enrich Big Labor’s coffers.

Some of the typical conditions demanded by unions in PLAs include monopoly bargaining, forced dues and fees for all “represented” workers, exclusive union hiring halls, and inflexible union work rules which strictly separate job functions into exclusive union jurisdictions based on craft.

One other particularly egregious feature of many PLAs requires contractors to make contributions to union pension plans. Nonunion employees will receive no retirement benefits for their work on a project because union pension plans have vesting periods that last longer than most projects. Nonmembers thus end up subsidizing the pensions of longtime union members.

According to the Bureau of Labor Statistics at the Department of Labor, only 15 percent of construction workers in the United States are unionized.