The Township of Parsippany is actively taking steps to ensure that construction projects in the community are supporting local workers and providing the best return on investment for taxpayers. They are doing this using Project Labor Agreements (PLAs). PLAs are transparent, agreed upon contracts that provide stability and structure on large scale construction projects. A PLA is an agreement between the owner of a project and the contractor that lays out both parties’ responsibilities on a particular construction project to ensure that the project runs smoothly and ultimately does not cost taxpayers additional dollars.
Planning is usually the best way to tackle any problem, and the Project Labor Agreement is the construction industries’ best tool to plan ahead. This agreement can establish terms of employment for workers, specifically wages and any fringe benefits. This is why unscrupulous contractors avoid them, allowing them to exploit and mistreat workers without clear terms and agreements. Unions, on the other hand, seek out PLAs because they create a stable foundation for a healthy relationship between labor and management, while protecting workers and the taxpayer.
Project Labor Agreements and unions are two of the best tools to protect workers from exploitation. A recent report by the University of California Berkeley Labor Center (Click here) concluded that nonunion construction workers should expect to continue to be exploited and cheated, and lawful contractors should expect to find it more and more difficult to remain in operation.
According to the Berkeley report, nearly four out of 10 construction worker families nationwide are so poorly compensated that they are forced to enroll in one or more safety net programs, such as Medicaid or the supplemental nutrition assistance program, also known as SNAP – a higher rate than that seen in the general population. Compare this with their union counterparts, who end up making on average higher wages and have better benefits, including healthcare and a pension.
Project Labor Agreements help prevent workers from being paid poverty wages. Poor wages end up costing the taxpayer millions of dollars. For example, in New Jersey, 33% of families of construction workers are enrolled in one or more safety net programs, and these benefits end up costing the state and the federal government $325 million per year. Without PLAs, the taxpayer could ultimately foot the bill for unlawful contractors’ profits.
Through transparent and upfront terms, Project Labor Agreements prevent workers from being misclassified by their employers. It is estimated that more than 2 million construction workers in the U.S. work full-time but are misclassified as “independent contractors,” which allows their employers to pay them in cash, without declaring the expense to the government. This is illegal and enables the employer to avoid paying taxes or benefits.
Created in the 1930s, Project Labor Agreements are used widely, and not just because they protect workers. The private sector has utilized them with great success. Examples include Disney World, the Kennedy Space Center and Yankee Stadium.
The Township of Parsippany, its workers, and its taxpayers deserve Project Labor Agreements to protect workers and taxpayers from exploitative wages and costly jobs.
William C. Sproule
Eastern Atlantic States Regional Council of Carpenters