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Court Deems $6 Billion Worth of NYC Project Labor Agreements Fully Legal

A Second Circuit panel has decided that Project Labor Agreements between the City of New York and the Building and Construction Trades Council (BCTC) of Greater New York do not violate federal labor laws. The BCTC, which represents roughly 50 regional unions, has $6 billion of work committed to various PLAs through 2014. These PLAs will set diversity, local hire, safety and wage standards on the job sites.

The lawsuit, filed on behalf of non-union contractors by the Building Industry Electrical Contractors Association and the United Electrical Contractors Association, alleged that PLAs were in violation of the National Labor Relations Act (NLRA). The Second Circuit Panel did not agree, according to Globe Street:

The plaintiffs, who are not members of the trade council, argued that the city was putting unions that did not belong to the council at a disadvantage because those unions may already have agreements with the city that are inconsistent with the PLAs. They said the city was acting as a regulator rather than a market participant. The panel in Building Industry Electrical Contractors Association v. City of New York, 11-3590, rejected this argument in a May 4 opinion.

“The PLAs challenged here represent the City’s permissible proprietary choice; the City has behaved just as any other major landowner or developer might to secure labor for many of its construction projects,” the panel wrote. “Because the PLAs are market activity and not regulation, the preemption claim must fail.”

PLAs have been on a roll lately, having recently earned legislative and judicial support in Michigan, California and Connecticut, among other states.


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