Games People PLA

Will the recent deal  to salvage the $2.8 billion second leg of the Rail-to-Dulles project require non-union  bidders to play footsy with the construction unions? The answer is far from  clear.

by James A. Bacon

A deal struck between the McDonnell administration and the  Metropolitan Washington Airports Authority (MWAA) will not require bidders on Phase  2 of the Rail-to-Dulles project to sign a Project Labor Agreement (PLA). Or  maybe it will. It’s really not clear. The wording of the Memorandum of Agreement  (MOA) is ambiguous. At least one McDonnell administration official insists that  the rights of non-union workers and companies are upheld in the agreement but neither  the MWAA nor the Attorney General’s office is talking.

The PLA issue is a sensitive one. Earlier this year, the  estimated cost of Phase 2 of the METRO rail project had ballooned roughly $1 billion  higher than the $2.8 billion in funding sources lined up to pay for it. A deal  brokered earlier this month by U.S. Transportation Secretary Ray LaHood  seemingly got the project back on track by extracting various commitments and  concessions from the state, MWAA, Fairfax County and Loudoun County, the four funding partners. The deal referenced a side agreement between Virginia  and the MWAA that details “principles and requirements” for a labor agreement.

In Phase 1 of the construction project, which extends the METRO past Tysons Corner, prime contractor Dulles Transit Partners entered  into a voluntary PLA to hire workers through a union hiring hall, although its  sub-contractors were not required to do so. MWAA has sought to make that  agreement mandatory for anyone bidding on Phase 2. But non-union companies and  many Fairfax and Loudoun elected officials objected, asserting that such an  agreement would discourage non-union companies from submitting bids. The loss  of competition, critics said, could result in bids $300 million or more higher  than the official estimate.

It is precisely that outcome that the McDonnell  administration sought to avoid, says Thelma Drake, director of the Department  of Rail and Public Transportation. A sticking point in negotiating the broader  deal was MWAA’s insistence that bidders on the prime contract be required to  sign a PLA. “We worried that having the PLA up front would discourage some companies  from bidding,” she explains. The Commonwealth Attorney’s office got involved in  drafting the language to ensure that any PLA would be consistent with state  Right to Work laws.

“The PLA is not mandatory,” Drake says. “You cannot require  your prime to sign a PLA.”

Sounds clear enough. But what does the actual MOA say?

The agreement states that no prime contractor or subcontractor  can require an employee to join a labor union. It also says that no prime or  subcontractor can be “discriminated against” based upon its affiliation or non-affiliation  with a labor union. But then the MOA says this:

  No prime contractor working or  seeking to work on Phase 2 shall be required, in order to secure or maintain a  phase 2 prime contract, to become a party to any labor agreement other than the Phase 2 PLA.

To some observers, the wording “other than” seems to specifically exempt the Phase 2 PLA from the rule — especially when considered in the context of what follows, a principle that states sub-contractors shall not be required to sign any labor union contract, “including” the Phase 2 PLA. The wording would seem to create an arrangement nearly identical to the Phase 1 PLA, which binds Dulles Transit Partners to a union workforce but exempts subcontractors.

“There are a lot of questions out there,” says Angie  Gutenson, vice president of the Virginia chapter of the Associated Builders and  Contractors, which represents the interests of open-shop contractors in the  state. The MOA states that Virginia’s Right to Work law will be enforced and  that non-union companies will not be “discriminated against.” But what does “discriminate  against” mean in this context? “We’re not lawyers, so we don’t know.” Read more.