The following is the text of a letter sent Sept. 14 to the Pawtucket, RI, school committee arguing against the imposition of a union-only PLA on school construction.
Dear Members of the Pawtucket School Committee:
With regards to of the suggestion of imposing a project labor agreement (PLA) on the rebuilding of the Henry J. Winters Elementary School, the Merit Construction Alliance wishes to provide important, relevant information to assist in your deliberations.
The Merit Construction Alliance is a non-profit trade organization representing the interest of merit shop construction contractors and their employees, many of whom perform public work across the Northeast, including Rhode Island. For over 20 years, MCA has advocated for fair and equal treatment for the merit shop members of the construction community. In doing so, the MCA engages policymakers, property owners and the general public about the discriminatory and costly nature of union-only policies such as project labor agreements.
On August 4, 2020, the Facilities Subcommittee voted to pay an attorney between $15,000 and $20,000 to conduct a PLA feasibility study, according to the meeting minutes. The MCA urges the Subcommittee and the entire School Committee to reject the notion of adopting a PLA and instead embrace fair and open competition in construction bidding. This is the only course of action that satisfies the State Purchasing Act’s purpose, which includes:
“(5) Insure the fair and equitable treatment of all persons who deal with the procurement system of the state;
“(6) Provide increased economy in state and public agency procurement activities by fostering effective competition;”
PLAs ensure unfair and unequitable treatment of construction workers and firms, and they reduce the economy achievable by state and public agencies by promoting a rigged, ineffective competitive bidding system. Please consider the following facts and observations:
§ PLAs Raise Costs by Restricting Competition. PLAs vastly shrink the pool of bidders to only contractors signatory to organized labor, and this results in higher prices. This is the opposite of “increased economy” and “effective competition.” Numerous studies show PLAs restrict competitive bidding and result project costs increasing by 15-20%. On the $55 million Winters School project, a PLA would either add at least $8.25 million to the cost or result in scaling back the project to accommodate the cost overrun.
In Connecticut taxpayers overpaid by many millions of dollars for public school construction between 2001 and 2019 because of so-called project labor agreements that restrict fair and open competition.
"The presence of a PLA increases the final base construction costs of a school by $89.33 per square foot (in 2019 prices) relative to non-PLA projects. Because the average cost per square foot of construction is $450.15, PLAs raise the final construction cost of building schools by 19.84 percent."
(Source: “The Effects of Project Labor Agreements on School
Construction in Connecticut,” Burke and Tuerk, January 2020.)
§ PLAs Raise Costs by Requiring Inefficient Union Work Rules. Enclosed for your review is a report by Skanska Building USA on behalf of the City of Worcester, Mass. In it, Skanska makes a compelling argument against using PLAs and some eye-opening observations, including:
“One of the factors that increase construction costs on these projects are requirements from the unions to have some number of support workers on site at all times, whether needed or not. These workers merely drive up the cost without a resultant benefit to the project, but the unions require them.”
(Source: “Study: Project Labor Agreements on Chapter 149a Projects,”
Skanska USA Building, January 2020.)
This is a practice known as featherbedding, and it is unheard of among merit shop contractors and their employees who believe in an honest day’s work for an honest day’s pay at the same hourly wage. Merit shop employers and employees believe that every person working on a project must serve a functional purpose. Outdated work rules do not add value, but they do add unnecessary costs to a project. Conservatively estimating an average union construction worker earns $100,000 in wages and benefits per year, the added cost of 10 unneeded workers would add $1 million to the project cost.
§ PLAs Amount to Government-Sponsored Job Discrimination – Against Pawtucket and Rhode Island Residents, too. Refusing to hire merit shop workers amounts to employment discrimination. It is neither fair nor equitable. Without a PLA, union workers and union contractors will have the same, equal opportunity to bid and work at their merit shop colleagues.
A PLA will lock out merit shop contractors from Rhode Island and Rhode Island residents employed by open shops. In Rhode Island, 85.4% of the construction workforce is non-union, according to unionstats.com. Coincidentally, Rhode Island taxpayers are paying 85% of the cost. Yet, a PLA would deny many of those taxpayers an opportunity to bid and work on the project their tax dollars are funding.
§ Merit Shop Workers Are Equally Qualified. Merit shop construction workers are highly trained, licensed professionals who are qualified to work on public and private projects. Merit shop workers complete apprentice programs and extensive training. They are skilled craftworkers who have successfully constructed countless modern school buildings. They pass the same licensing exams as their union counterparts. The only difference is they make the personal choice not to join organized labor.
§ State & National Laws Protect All Workers, Not PLAs. Federal and state laws protect the rights of construction workers by setting pay rates and safety standards. Merit shop employees enjoy pay and benefits equal to, if not better than, their union counterparts. Merit shops offer excellent health insurance plans; paid holidays, sick days and vacation time; and fully funded 401(k) pension plans. Merit shop contractors also pay to provide ongoing training to their workers, while union members pay for their own training through payroll deductions. Merit shops provide rigorous safety training. They employ safety inspectors and follow safety programs, all designed to prevent injuries and accidents.
§ 4 Out of 5 Are Merit Shop Workers. Unions represent a small fraction of construction workers. Why don’t more workers join unions? There are likely a variety of reasons including pay and benefits, career opportunities, and loss of income to union dues and other mandatory withholdings. There is another reason: merit shop employees work full-time and year-round, while union workers can expect to be unemployed for months out of a year.
Unions warn their apprentices to expect periods of unemployment throughout their union career:
“In construction there is often urgency to finish a project and then periods of no work between jobs. This means that you may work 60 hours per week during the busy season and then be laid-off for weeks or months at a time.”
(Source: “The Ultimate Guild to Becoming a Union Building Trade Apprentice Massachusetts,”
published by the Building Trades Training Directors Association of Massachusetts.)
§ PLAs Defeat Hiring Goals. PLAs fail to guarantee the hiring of minorities, women and local residents. By locking out the vast majority of construction workers, as well as minority- and women-owned merit shops, PLA projects do not have access to the available workers necessary to meet those hiring goals. As the Skanska report observed:
“Historically, the unions are not as able to guarantee a diverse workforce.”
(Source: “Study: Project Labor Agreements on Chapter 149a Projects,”
Skanska USA Building, January 2020.)
Most recently, the City of New Bedford joined San Francisco, Philadelphia, Washington, D.C., New York, and Baltimore in failing to meet goals for hiring residents, women, and minorities on construction projects, despite the promises of PLA supporters.
§ PLAs Provide No Guarantees on Budget & Deadlines. PLAs do not prevent strikes or work stoppages. Nor do they ensure work is done on-time and on budget. Performance metrics can be addressed in construction contracts without barring merit shops. Numerous examples exist of organized labor walking off projects governed by PLAs, where there is not a single example of merit shop employees striking. Many examples exist of PLA projects overbudget, late and with poor workmanship; Boston’s Big Dig being one example.
In conclusion, PLAs are discriminatory, costly and unnecessary. They should never be used on any project, regardless of size or cost. PLAs deny the great majority of construction workers the opportunity to work on a project simply for choosing not to join a labor union. The justifications for PLAs simply obscure their true purpose, which is to unfairly block competition from non-union craftsmen and create a monopoly for organized labor.
In order to ensure fair and equitable treatment, foster effective competitive bidding, avoid unnecessary cost increases, and avoid the potential for costly litigation by an aggrieved party unjustly denied the ability to bid, the Merit Construction Alliance respectfully urges the School Committee to reject the imposition of a PLA on any school construction projects.
Thank you for the consideration on this matter, and please do not hesitate to contact me if I can be of assistance.
Kind regards,
Jason Kauppi
President
cc: The Honorable Donald R. Grebian, Mayor of Pawtucket
Dr. Cheryl McWilliams, Superintendent, Pawtucket Schools
Commissioner Angelica Infante-Green, Rhode Island Department of Education
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