📄 Project Labor Agreements (PLAs)
Project Labor Agreements are one of the most debated topics in construction. If you work on large public or private projects, you'll encounter PLAs — and understanding how they work determines whether they're an opportunity or a barrier for your company.
Key Principle
A PLA is a project-specific labor agreement, not a permanent union commitment. Even open-shop contractors can work under a PLA without becoming signatory to a union for all their work. Understanding this distinction is the key to navigating PLAs successfully.
What Is a PLA?
A Project Labor Agreement (also called a Community Workforce Agreement or Stabilization Agreement) is a pre-hire collective bargaining agreement between a project owner, construction unions, and contractors that establishes the terms and conditions of employment for a specific project.
Key Characteristics
| Feature | Details |
|---|---|
| Scope | Applies to one specific project only |
| Parties | Project owner + building trades council + all contractors and subs on the project |
| Duration | Life of the project |
| Coverage | All workers on the project, regardless of their union status |
| No-strike clause | Unions agree not to strike for the duration |
| Dispute resolution | Grievance and arbitration procedures — no work stoppages |
| Hiring | Workers sourced through union hiring halls |
| Wages and benefits | Per the applicable union CBA rates |
PLA vs. CBA
| Feature | PLA | CBA (Collective Bargaining Agreement) |
|---|---|---|
| Duration | Single project | Multi-year (3–5 years typically) |
| Scope | One project only | All work for signatory contractor |
| Commitment | No long-term obligation | Ongoing signatory obligation |
| Hiring | Through hiring hall for this project | Through hiring hall for all work |
| After the project | Agreement ends | Agreement continues |
When PLAs Are Used
Common PLA Projects
| Project Type | Why a PLA |
|---|---|
| Large public infrastructure ($100M+) | Schedule certainty, no strikes, workforce coordination |
| Federal construction (executive order encourages PLAs on $35M+) | Biden administration Executive Order 14063 |
| State/local public works | Some jurisdictions mandate or encourage PLAs |
| Large private projects | Owners seeking schedule certainty and labor peace |
| Mission-critical facilities | Hospitals, data centers, airports — can't afford work stoppages |
| Multi-trade projects | Jurisdictional disputes resolved upfront |
Federal PLA Policy
| Administration | PLA Stance |
|---|---|
| Obama (2009) | Executive Order 13502 — encouraged PLAs on federal projects $25M+ |
| Trump (2017) | Revoked Obama EO — discouraged PLAs |
| Biden (2022) | Executive Order 14063 — requires PLAs on federal projects $35M+ |
| Future | May change with administration |
PLA Requirements Shift with Politics
Federal PLA policy swings with each administration. State and local PLA policies also evolve. Always check the current requirements for your specific project and jurisdiction.
How PLAs Work in Practice
For the Project Owner
- Owner decides to use a PLA (or is required to)
- Owner (or their representative) negotiates the PLA with the local Building and Construction Trades Council
- PLA is included in the bid documents
- All bidders must agree to abide by the PLA
- PLA governs all labor relations on the project
For Contractors (Union and Non-Union)
| Step | What Happens |
|---|---|
| Bid phase | PLA terms are included in bid documents — agree to them or don't bid |
| Award | Contractor signs the PLA as a condition of the contract |
| Hiring | Source workers through the union hiring hall |
| Wages/benefits | Pay per the applicable union CBA rates |
| Rules | Follow CBA work rules, overtime, holidays, shift provisions |
| Trust funds | Make fringe benefit contributions to union trust funds |
| Reporting | Submit trust fund reports and certified payroll |
| Project end | PLA obligations end — no ongoing union commitment |
Workforce Provisions
Most PLAs include provisions for the existing workforce of open-shop contractors:
| Provision | Typical Terms |
|---|---|
| Core employees | Open-shop contractors can bring a percentage of their own workforce (often 5–7 workers or a percentage) |
| Referral | Core employees are referred through the hall but given priority dispatch |
| Union membership | Core employees typically must join the union (or pay equivalent fees) for the project duration |
| Return to non-union | After the project, core employees return to non-union status |
| Hiring hall dispatch | Additional workers beyond the core crew come from the hiring hall |
The Core Employee Provision Is Critical
If you're an open-shop contractor considering a PLA project, negotiate the core employee provision carefully. This determines how many of your experienced workers you can bring versus how many will be dispatched from the hall. The more core employees you can bring, the more control you have over your crew quality.
PLA Pros and Cons
For Project Owners
| Pros | Cons |
|---|---|
| No strikes or lockouts — schedule certainty | May reduce the number of bidders (open-shop firms may not bid) |
| Single dispute resolution process | Higher labor costs in some markets |
| Jurisdictional disputes resolved upfront | Administrative overhead |
| Uniform work rules across all contractors | Potential legal challenges |
| Workforce development (apprentice requirements) | Political controversy |
| Standardized safety programs |
For Union Contractors
| Pros | Cons |
|---|---|
| Familiar rules — no change from normal operations | May face more competition from open-shop firms who sign the PLA |
| Level playing field — all contractors pay union rates | PLA terms may differ from your regular CBA |
| Stable labor supply through the hall | |
| No competition from non-union on wages |
For Open-Shop Contractors
| Pros | Cons |
|---|---|
| Access to large projects you might otherwise miss | Must use union hiring hall (less control over workforce) |
| No long-term union commitment | Must pay union wages and fringes (higher costs) |
| Core employee provisions protect key workers | Workers may be recruited by the union during the project |
| Workforce supplementation from the hall when you need more hands | Trust fund reporting and admin burden |
Navigating PLAs as an Open-Shop Contractor
Should You Bid a PLA Project?
| Consider Bidding If... | Consider Passing If... |
|---|---|
| The project is large enough to justify the learning curve | Your competitive advantage is entirely based on lower labor costs |
| You can bring enough core employees to maintain quality | You have zero experience with union processes |
| The PLA has reasonable core employee provisions | The core employee limit is too restrictive |
| Your estimating team understands union rates and burden | You can't or won't comply with hiring hall and trust fund requirements |
| You want to access the public/institutional market long-term | This is a one-off and the administrative setup cost isn't worth it |
Practical Steps
- Read the PLA carefully — especially core employee provisions, hiring procedures, and overtime rules
- Estimate at union rates — use the CBA wage and fringe package for your trades
- Factor in trust fund costs — monthly reporting and contributions
- Budget for higher burden — FICA only on base wage (not fringes to plans), but higher base wage
- Contact the hiring hall before bidding — understand dispatch procedures and workforce availability
- Consult a labor attorney — especially if this is your first PLA project
- Train your project team — on union work rules, hiring hall procedures, and trust fund reporting
Managing Trust Fund Obligations
| Task | Details |
|---|---|
| Registration | Register with each applicable trust fund before starting work |
| Monthly reports | Submit hours and contributions by the 15th–20th of each month |
| Payment | Pay contributions with the report — late payments trigger penalties |
| Recordkeeping | Keep payroll records for trust fund audit (up to 6 years) |
| Wind-down | After the project, finalize all trust fund payments and reporting |
Community Workforce Agreements (CWAs)
A CWA is a variant of a PLA that adds community benefit provisions:
| Feature | Details |
|---|---|
| Local hire requirements | Percentage of hours to local residents (often 25–50%) |
| Targeted hire | Hours for disadvantaged workers, formerly incarcerated, veterans, etc. |
| Apprentice requirements | Minimum apprentice hours, often exceeding standard ratios |
| First source hiring | Local workforce programs as the first referral source |
| Pre-apprenticeship | Pathways for community members to enter apprenticeship |
| Monitoring | Third-party compliance monitoring |
CWAs are increasingly common on large public projects, especially in urban areas.
Legal Considerations
Constitutional Issues
PLAs on public projects have faced legal challenges, but have generally been upheld:
| Issue | Current Status |
|---|---|
| Federal projects | Legal when authorized by executive order |
| State/local projects | Legal unless state law prohibits (some states have anti-PLA laws) |
| Anti-PLA states | Several states prohibit PLAs on state-funded projects |
| Federal preemption | NLRA preempts some state regulation of PLAs |
States with Anti-PLA Laws
Several states restrict or prohibit PLA requirements on public projects:
- Alabama, Arizona, Arkansas, Georgia, Idaho, Iowa, Kansas, Louisiana, Michigan, Mississippi, Nebraska, North Carolina, North Dakota, Oklahoma, South Carolina, South Dakota, Tennessee, Texas, Utah, Virginia, Wisconsin
Related Resources
- Union Construction Guide — Understanding union operations
- Government Contracts Guide — Public works bidding
- Prevailing Wage Guide — PLA rates and prevailing wage
- Fringe Benefits in Construction — Trust fund contributions under PLAs
- Worker Classifications — Union classifications on PLA projects
- Apprenticeship Programs — Apprentice provisions in PLAs