A Project Labor Agreement (PLA) is a type of pre-hire agreement designed to facilitate complex construction projects. Each PLA is negotiated and designed individually– tailored to meet the needs of a specific project owner/manager, and or community. By governing and establishing work rules, pay rates, and dispute resolution processes for every worker on the project, PLAs maximize project stability, efficiency and productivity. Moreover, PLAs help minimize the risks and inconvenience to the public that often accompany public work projects.
As such, PLAs help ensure that projects are not only completed on time but on or under budget. That’s why Project Labor Agreements have long been used in the private and federal sectors, and more recently by state, county and municipal agencies.
On a typical construction project operating without the benefit of a PLA, there may be fifteen or more different collective bargaining agreements covering work being performed by various crafts. These union contracts are not generally coordinated in any meaningful way. This occasionally leads to unavoidable inefficiencies.
Project Labor Agreements are negotiated to cover all the crafts on a single project. The term of the PLA coincides with the duration of the project. Because PLAs eclipse the expiration dates of various local union agreements, they prevent work delays that might result from individual contract negotiations that ordinarily occur during the life of a project. No-strike and no-lockout provisions are standard in Project Labor Agreements. To further mitigate potential sources for labor-management conflict, PLAs commonly provide alternative dispute resolution procedures for a range of issues.
Because a PLA applies to all the crafts on its covered project, it standardizes otherwise incompatible work schedules, apprentice-journey level ratios, hours, payment arrangements, and other terms and conditions, providing greater cost efficiencies. Some PLAs also include cost saving procedures for workers compensation issues. Any contractor – union or nonunion, alike – is free to bid on a project covered by a Project Labor Agreement. Because PLAs determine all terms and conditions in advance, they allow contractors to more accurately predict labor costs and schedule production timetables. Contractors who agree to perform under the terms of the PLA get immediate access to a pool of well-trained and highly-skilled workers through union referral procedures during the hiring process.