The U.S. District Court for the Eastern District of Michigan, Detroit, has struck down the state’s “Fair and Open Competition in Governmental Construction Act” (Public Act 98) curtailing local government units’ ability to exercise project labor agreements (PLAs) on construction contracts.
Federal Judge Victoria Roberts ruled that PA 98 “impermissibly interferes with the comprehensive regulatory scheme” per the National Labor Relations Act. Signed in July 2011 by Michigan Governor Rick Snyder, “Fair and Open Competition” prohibited local communities from entering into a contract that “requires, prohibits, encourages, or discourages bidders, contractors, or subcontractors from entering into or adhering to agreements with a collective bargaining organization relating to the construction project or other related construction projects.”
“We warned the Legislature [PA 98] interfered with federal labor law,” said attorney John Canzano, who challenged the state law on behalf of the Michigan Building and Construction Trades Council (BCTC), representing about 100,000 rank & file. “PLAs are essentially a form of collective bargaining, and Gov. Snyder and the legislature attempted to limit union rights under federal labor law.”
Michigan BCTC and Genesee, Lapeer, Shiawassee BCTC challenged PA 98 in Michigan District Court in August. Judge Roberts heard two hours of oral arguments and took additional briefs in the case. Michigan Attorney General Bill Schuette's office argued to uphold the law.
PLAs can vary from one contract to another, but generally establish wage rates and hours, while typically prohibiting strikes or lockouts. They can also include language that spells out standards for safety or skills training for workers, plus drug and alcohol testing requirements.
“We applaud the court's decision,” said Michigan BCTC President Zane Walker. “It's clear that Republican lawmakers saw Public Act 98 as a way to interfere in the workings of local communities. Republicans in Lansing wanted to dictate how municipalities establish their bidding practices and how they should run their community business. Project labor agreements work.”