US trade body, Associated Builders and Contractors (ABC), says it’s “ecstatic” after a federal court nullified a 2022 executive order from former President Joe Biden mandating project labour agreements (PLAs) on federally funded projects valued at $35m or more.
The 21 January decision by the US Court of Federal Claims ruled in favour of 12 construction companies who had filed bid protests against three federal agencies that mandated PLAs in tenders.
Law firm Schwabe noted that the court determined that the mandatory PLA requirement “violated the Competition in Contracting Act’s ‘full and open competition’ procedure by disqualifying otherwise responsible contractors who do not enter into a PLA with a labour union, even though those contractors may otherwise offer the government the best value”.
ABC said the policy inflated construction costs and steered contracts to unionised firms and union labour.
‘Justice for American taxpayers’
“ABC and its federal contractor members are ecstatic that the judicial system has delivered justice for American taxpayers and the 90% of the US construction industry workforce that is nonunion,” said ABC vice-president Ben Brubeck.
He added: “ABC members were harmed by former President Biden’s costly executive overreach, which violates federal laws and rewards special interests at the expense of fair and open competition,” he added. “As a result of this decision, ABC federal contractors should continue to file bid protests against individual federal agency PLA mandates on a case-by-case basis and expect similar outcomes.”
ABC has estimated that PLAs increase construction costs by between 12% and 20%, while reducing competition from qualified contractors.
The association said its members have won 54% of the roughly $205bn in federal contracts worth $35m or more between 2009 and 2023.
Last January, another trade body, Associated General Contractors of America, failed in its bid to challenge Biden’s PLA mandate in Louisiana District Court.
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