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Project Labor Agreements Give Unionized Companies Unfair Advantage

Americans may be about to experience a trillion-dollar infrastructure boom. All those zeros mean getting the most for taxpayers’ money is particularly important. That makes government-mandated project labor agreements a major issue impacting taxpayers and the construction industry’s ability to rebuild America’s infrastructure.

Government-mandated project labor agreements are typically drafted by construction unions, without input from nonunion contractors, that all bidders on particular projects must accept. Typical terms include union representation and mandatory membership or union fees for all workers (including those working for nonunion employers), following union work classifications and rules (including getting all workers from union hiring halls and all apprentices from union apprenticeship programs), and contributing to union benefit and multi-employer pension plans that few nonunion members will get a penny from.

They are also contentious. Construction unions want them; nonunion construction firms and workers oppose them on taxpayer-funded projects.

Gary M. Galles is a Research Fellow at the Independent Institute, Professor of Economics at Pepperdine University, and Adjunct Scholar at the Ludwig von Mises Institute.