Live Union or Die

A construction project in New Hampshire has become the latest battleground in the power struggle between business and labor.

North Branch Construction, a nonunion contractor in Concord, New Hampshire, filed a bid protest Monday with the Government Accountability Office that accuses the Department of Labor of violating federal law by requiring that a project labor agreement be used in the construction of a federal Job Corps center in Manchester, New Hampshire.

Under project labor agreements (PLAs), contractors are required to enter into a collective bargain agreement with a labor union that establishes the terms and conditions of employment for specific construction projects.

President George W. Bush had barred agencies from requiring PLAs on federal contracts, but President Obama—in his third week on the job—repealed Bush’s executive order. Obama issued a new order, encouraging agencies to use PLAs on large construction projects. Obama did it in the name of efficiency, contending that working out these labor issues up front would ensure the timely completion of projects.

Nonunion contractors saw it differently—as political payback from Obama to the unions who helped elect him president.

“PLAs are special-interest handouts that deny taxpayers the accountability they deserve from federal contracts,” said Ken Holmes, president of North Branch Construction.

His company’s bid protest alleges the Department of Labor’s PLA requirement “unduly restricts competition” and violates several federal laws and regulations, including the Small Business Act. It also will increase the cost of the project, Holmes said.

More than 90 percent of New Hampshire’s construction workforce is not unionized, meaning these workers wouldn’t benefit from the jobs created by the Job Corps project, Holmes said.

Holmes is a member of Associated Builders and Contractors, a trade association that is lending its support to his bid protest.

ABC believes this contract is the government’s first mandated PLA since Obama issued his executive order. The Federal Acquisition Regulatory Council in July issued a proposed regulation that would codify the order, but it’s still reviewing comments on the proposal. It has not issued a final rule.

The battle over PLAs may directly affect only construction companies, but it’s just one front in the war between business and labor. The biggest battle is yet to come—a vote in Congress on the Employee Free Choice Act, which would make it easier for unions to organize workplaces. Meanwhile, there are plenty of ways the Obama administration can—and will—use its executive power to make life easier for unions.