Obama Reinstates Project Labor Agreements

President Obama has issued an Executive Order that encourages federal government agencies to require Project Labor Agreements (“PLA”) on large scale construction contracts.  This Order revokes two prior Executive Orders issued by President George W. Bush, which had reversed a memorandum issued by President Clinton to federal government agencies encouraging PLA.

A “PLA” is a pre-hire collective bargaining agreement with one or more unions that establishes the terms and conditions for a specific construction project.  If required by an agency, the PLA is binding on all contractors and subcontractors, prohibits strikes, lockouts and similar job disruptions, and sets forth a prompt and mutually binding procedure for resolving labor disputes.  Agencies will have discretion, but are encouraged, to require a PLA on construction projects that are for $25 million or more.