Summary Statement
This study examines a large number of project labor agreements (PLAs) using a variety of techniques, including archival research, interviews, case studies and the statistical analysis of original data. PLAs are pre-hire collective bargaining agreements that establish the terms and conditions of employment on one or more construction projects. Interview evidence suggests that safety inputs are greater on PLA projects including language establishing labor/management safety committees.
2007
2.The Content of PLAs
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Cost containment provisions
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Wages
Premium pay
Benefits
Pay for time not worked
Work rules
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No-strike/no-lockout and dispute settlement provisions
Safety, training, and minority employment
A PLA checklist
Before analyzing the effects of PLAs, the contents require explanation. There are two model agreements adopted by the AFL-CIO’s Building and Construction Trades epartment and approximately one hundred actual PLAs covering projects in 17 states.
Two categories of PLA provisions are clearly designed to promote cost savings on projects. The first category primarily includes compensation concessions on wages, benefits, premium pay and pay for time not worked (e.g. breaks). The second type of provision seeks to contain cost by enhancing productivity by relaxing work rules, minimizing crew sizes and restricting the introduction of new technology, among other things.
Wages
Direct wage concessions in PLAs are rare.Most PLAs simply incorporate the wage schedules from local collective bargaining agreements. These are usually called Schedule A agreements, with Schedule A being the first contract appendix. However, a PLA occasionally will call for a trades’ more favorable wage schedule to be used (e.g. residential rates on a commercial project). Less common is a separate wage schedule with different pay rates and different timings for pay increases.
Though rare, across-the-board wage concessions are possible and were more common during the recession of the early 1990s. A PLA for a building project at a private college in Rhode Island, for example, stated that “All employees covered by this agreement shall be classified in accordance with work performed and paid at the rate of eighty percent (80%) of the base hourly wage rates for those classifications…”
A more common concession is a wage freeze for the life of a project. A Connecticut PLA read, “The wage rates will be frozen as of September 1, 1998 for the remainder of the project. Fringe benefits shall not be frozen during this period.”
Premium pay
PLAs often limit the types of premium pay available on a project. A New Jersey PLA allowed for reporting and call back pay but otherwise held “there shall be no premiums, bonuses, hazardous duty, high time or other special payments of any kind.” Similarly, overtime may be limited. A Connecticut PLA called for time-and-one-half to be paid after “ten hours worked in a day or forty hours worked in a week.” Area agreements required premium pay after eight hours of work.
Benefits
We discovered two approaches in PLAs to limiting benefits’ costs.Most common, PLAs restrict the payments required of contractors to those funds that directly benefit employees. An Oregon agreement stated that “The employer shall pay only fringe benefit funds for employees (such as pension, health and welfare, vacation, apprenticeship and the like) that have been legally negotiated and established by the applicable collective bargaining agreement… This expressly excludes any and all Industry Promotion Funds, Contract Administration Funds, Contractor-Union Management Funds, Craft of Industry Alliance of Associations.”
A clause in a New England PLA limited premium contributions (for most trades) to the straight time rate, regardless of whether work was being performed at straight time or premium rates.
Pay for time not worked
A clause from a New York PLA stating, “There will be no rest periods, organized coffee breaks or other non-working time established during working hours” is typical. Some PLAs specifically allow workers to bring beverage containers to their workplace for brief individual pauses. Except for lunch breaks, pay for time not worked is often limited by PLAs.
Work rules
PLAs generally include broad proscriptions on practices that would, in any way limit productivity. Consider the following two sections from an Indiana PLA:
Section 1: There shall be no limit on production by workers nor restrictions on the full use of tools and equipment. There shall be no restriction, other than may be required by safety regulations, on the number of employees assigned to any crew or to any service. … Section 7: The Union will not impose conditions which limit or restrict production or limit or restrict the joint or individual working efforts of employees. The Construction Contractor may utilize any method or technique of construction, and there shall be no limitation or restriction regardless of source or location of machinery, precast tools, or other labor-saving devices, nor shall there be any limitation upon choice of materials and design. |
Provisions effecting scheduling
As the interview portion of this research reveals, one of the primary reasons that construction users agree to PLAs is their effect on scheduling. It is particularly significant when a project has a tight deadline, such as completion before the start of a school year or sports’ season. Nearly all PLAs include in the preamble some mention of the need for timely completion. This mention may be general or very specific.
As well, PLAs usually reconcile the often disparate work schedules of the trades. PLAs specify standard start, quit and break times, and most PLAs note a uniform set of holidays. The following language is from a Minnesota PLA and addresses a number of scheduling issues.
Article VIII Hours of Work, Overtime, Shifts and Holidays 8.1 The regular forty (40) hour work week will start on Monday and conclude on Friday. Eight (8) consecutive hours, exclusive of a one-half (1/2) hour lunch period, between 7:00 a.m. and 5:00 p.m. shall normally constitute a work day. The starting time of the Work may be changed within these hours by the Employer upon notification to the Union to take advantage of daylight hours, weather conditions, shift, or traffic conditions. It is understood that all work performed in excess of eight (8) hours per day shall be considered overtime. Starting time may be adjusted up to one (1) hour prior to 7:00 a.m. with mutual consent of the Union and Employer. 8.2 At the scheduled starting time, all employees will be at the place where they pick up their tools or receive instructions from their foreman. They shall remain at their place of work under the supervision of the Employer until the scheduled quitting time. There shall be no practices that result in starting work late in the morning or after lunch or in stopping work early at lunch time or prior to the scheduled quitting time. Coffee breaks will be limited to ten (10) minutes and shall be taken in close proximity to the Employee’s Work Station. The parties are in accord that the intent of the Agreement is a “fair day’s work for a fair day’s pay” and Work should be managed in such a manner to enable the Employer to maintain and increase efficiency consistent with fair labor standards. 8.3 When employees leave the Work on their own accord at other than normal quitting time, it is their responsibility to notify the Employer. Employees will be paid only for actual hours worked. 8.4 The Employer shall determine the recording devices, checking systems, brassing or other methods of keeping time records on the Work. 8.5 An effort will be made to keep overtime work to a minimum but when such is judged necessary it will be worked at the direction and discretion of the Employer. 8.6 All overtime to be paid at time and onehalf except on Sunday and Holidays which will be paid as specified in Local Union Bargaining Agreements 8.7 All employees shall be paid for actual time worked. The Employer shall have sole responsibility to determine availability of work due to weather conditions. 8.8 Shift work may be performed at the option of the Employer. In the event the second or third shift of any regular work day shall extend into a holiday, employees shall be paid at regular shift rates. Shift work shall be paid as specified in local collective bargaining agreements. When so elected by the Employer, multiple shifts of a temporary basis, shall be worked the number of consecutive days required by the Local Union Bargaining Agreement. 8.9 Uniform holidays for the Agreement are as follows: New Year’s Day, Good Friday, Memorial Day, Fourth of July, Labor Day, Thanksgiving Day, the Friday after Thanksgiving, Christmas Eve Day and Christmas Day. If any of these holidays fall on a Saturday or Sunday, the preceding day, Friday, or the following day, Monday, shall be considered to be a legal holiday. A holiday shall be a 24-hour period commencing with the established starting time of the day shift on the date of the holiday. 8.10 When work is to be performed in controlled areas, the Employer may elect to have the employees take two (2) one-half hour breaks instead of two (2) ten minute coffee breaks and a one-half hour lunch period. |
No-strike/no-lockout and dispute settlement provisions
Perhaps most importantly, PLAs insulate work on a project from disruptions that might occur because of labor relations issues or grievances.
Some no-strike/no-lockout provisions are very broad and preclude all types of actions. Others provide a narrow exception that allows striking if a contractor is delinquent in its payments to benefits’ funds. The BCTD model PLA allows for disciplinary action—including ineligibility for rehire for ninety days—for any individual who violates the no-strike provision.
To ensure that disruptions do not occur or are dealt with swiftly, PLAs often contain several types of dispute settlement mechanisms. First, many PLAs, following the BCTD model, have a three step grievance procedure ending in binding, neutral third-party arbitration. This procedure handles typical complaints of contract violations. Second, PLAs often have some method of resolving jurisdictional disputes.Most PLAs simply refer matters to the BCTD’s plan for the settlement of jurisdictional disputes in the construction industry. Some, however, contain their own procedures for resolving such disputes, particularly for cases where a non-BCTD union or employer who does not agree to use the plan is involved. Clear language in the scope of work provision and requirements for pre-bid or pre-job conferences are also ways of avoiding jurisdictional problems.
Many PLAs also have expedited procedures to handle job actions if they do occur. Typically, an arbitration hearing is held quickly with an immediate finding as to whether a job action has taken place. If one has, injunctions are authorized and penalties may be handed out to the offending individuals, unions or employers.
Safety, training and minority employment
All of the PLAs reviewed for this research mention the need to adhere to safe work practices. In some cases, these are fairly brief statements calling for adherence to contractor’s safety rules and OSHA or state safety regulations. Drug testing policies are also a nearly universal item.
It is not uncommon, however, for safety clauses to be much more highly-developed and include, among other things, labor/management committees and mandatory testing on safety protocols. Rather than being included in the PLA itself, a project safety plan is often a separate document altogether.
Since PLAs typically cover large projects that last for several years, they provide excellent opportunities for training initiatives. Changes in the journeyman/apprentice ratio, the inclusion of preapprenticeship programs and even programs to set aside a portion of worksite for training are possibilities. An Indiana PLA, for example, stated that apprentices and non-journeymen may be “up to forty percent (40%) of a craft’s workforce…unless the local collective bargaining agreement establishes a higher percentage.”
A New York PLA provides a good example of a pre-apprenticeship program. In this case, preapprentice opportunities were provided to “students of the City of Buffalo’s Vocational High Schools.” The PLA stated that students “shall perform ‘hands-on’ work in the following trades: carpentry/ drywall, taping, interior finishes/painting, electrical, plumbing, communication and low voltage cabling, masonry, HVAC, finish carpentry work and fire protection.
An extraordinary training program was part of the PLA for British Columbia’s Island Highway. The centerpiece of the effort was the Hindoo Creek project, a section of highway built by trainees. As reported by Cohen and Braid, “Time spent on the job was strictly on actual production. ‘I wasn’t just pushing barrels around from one side of a training yard to another,’ one trainee explained, ‘I was doing real work.’” 22
The Hindoo Creek project was part of an effort to recruit women and minorities into construction. Targets and local hiring initiatives are also means of increasing minority participation under PLAs. A Connecticut PLA, for example, required that local residents be given first hiring preference, followed by those in neighboring communities. A New Jersey PLA stated that “up to 50% of the apprentices placed on this project shall be first year, minority, women or economically disadvantaged apprentices as shall be 60% of the of the apprentice equivalents…”
Critical miscellaneous provisions
Several other distinctive aspects of PLAs deserve mention. The Scope of Agreement provisions are highly detailed in PLAs. In order to avoid conflicts over what work the PLA covers and does not cover, the PLA project must be well defined. The following is an example from the Boston Harbor project.
The Management Rights clause in nearly all PLAs includes the rights to “hire, promote, transfer, layoff or discharge for just cause.” The latter part of the provision bears special notice, since many local agreements in the construction industry do not include a just cause provision. However, these are typical in PLAs and balance with the dispute settlement procedures as a means of resolving just cause issues.
PLAs generally require all contractors on a project to use the referral system that is specified in the PLA or those included in local agreements. Some PLA referral mechanisms allow nonunion contractors to bring some of their own workers onto a project. These are called core personnel, key man or drag along provisions. For example, a western New York State PLA provides an illustration. It read, “In addition, the Contractor may hire, per craft, five (5) journeypersons referred by the affected trade or craft and may the hire one (1) core employee as a journeyperson who has been regularly employed by that Contractor for a reasonable time.”
Such Project are generally described as the construction of the following:
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Finally, the term of agreement or duration clause is critical. Such clauses are much more complex in PLAs than in local agreements. Rather than the typical three or four year termination dates, PLAs must have detailed language concerning a project’s completion. Without such language, disputes may arise as whether subsequent work is covered by the PLA. The following illustration comes from a Nevada PLA and shows the detail of such clauses:
ARTICLE XVIII The Project Labor Agreement shall be effective on the date approved by the [owner], the Union and the General Contractor and shall continue until final acceptance, as defined in Section 1(b) of this Article, of the Project construction work described in Article II hereof. Section 1:
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The following table provides a comprehensive checklist of items for negotiators of PLAs. However, the list should not be a substitute for the important needs on a specific project. As chapter five states, the strength of PLAs is the ability to address these needs. The initial questions negotiators should ask are:What are the important issues on this project (e.g. cost, scheduling, safety, etc.)? How can the PLA be structured to handle these issues?
Table 1: A PLA Item Checklist 1. Purpose
2. Scope of agreement
3. Union recognition
4. Management’s rights
5. Referral of employees
6.Apprentices and trainees
7.Wages and benefits
8.Work rules
9.Work stoppages and lockouts
10. Grievances and arbitration
11. Jurisdictional disputes
12. Union security
13. Union representation
14. Hours of work
15. Subcontracting
16. Safety and health
17. Saving clause
18.Term of agreement
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