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PennDOT contests ruling on labor agreements

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PennDOT is appealing court rulings last month that said a project labor agreement for road work in Norristown was unfair to two companies that don't use union labor.

A PennDOT spokesperson said agency attorneys filed the appeal Feb. 11 with the state Supreme Court in two cases affected by the rulings, which were handed down by Commonwealth Court: Myers v. PennDOT and Eckman v. PennDOT. Both involve a construction project along Markley Street, or Route 202, in Montgomery County.

The Associated Builders and Contractors of Eastern Pennsylvania cheered the Commonwealth Court’s ruling, which came Jan. 11, arguing that the PennDOT contract would have unfairly required non-union contractors to hire a union workforce.

A project labor agreement, or PLA, requires a company to hire a union workforce as part of the contract.

Contractors Allan Myers LP and J.D. Eckman Inc. planned to bid for a piece of the work on Route 202 but wouldn’t have been able to use their own employees, and so they were not able to compete for a contract, explained Brent Sailhamer, director of government affairs for the ABC office in Harrisburg. ABC has five chapters statewide.

Sailhamer said ABC is concerned about PennDOT’s appeal because the court’s opinion was strongly worded in favor of the construction companies.

Legal stay sought

J.D. Eckman had been involved in the first phase of the Markley Street project and was recognized by the court for completing the work a year ahead of schedule, ABC noted in a written statement after the January court rulings. (While the Eckman and Myers rulings were similar, Sailhamer said, the ruling in the Myers case had the most substance because the court references that decision in the Eckman case.)

Eckman was not under a project labor agreement for the first phase of the project. But a PLA was required in August 2017 when PennDOT started seeking bids for the second phase, court records show.

Both Eckman and Myers hoped to bid. But the PLA requirement was reaffirmed later that year by PennDOT, leading the businesses to file legal challenges in December 2017. In the 18-page opinion last month, the Commonwealth Court cancelled the bid solicitation.

“Allan Myers cannot make its employees or subcontractors join a union,” the court said in the opinion, adding: “The PLA does not guarantee that the Local Unions will accept Allan Myers’ existing workforce as members or assign them back if they are accepted. Allan Myers cannot bid for the Project with an unknown workforce. The PLA has effectively precluded a nonunion contractor, such as Allan Myers, from participating in the bid solicitation.”

PennDOT attorneys declined to comment, said Ayanna N. Williams, the agency’s community relations coordinator for District 6, which covers Bucks, Chester, Delaware, Montgomery and Philadelphia counties.

However, PennDOT has asked the Commonwealth Court for a stay so that the Markley Street project can continue while the case is on appeal with the Supreme Court.

“PennDOT has asked the lower court for a stay pending appeal,” Williams said in an email. “However, we will not comment any further on the matter as it is currently in litigation.”

If granted, the stay could allow union shops to do the work while the appeal is pending, making the court ruling effectively moot, Sailhamer argued.

PLAs became more common nationwide under the Obama Administration, which encouraged the agreements across federal agencies seeking bids on contracts involving federal funds. Efforts have been made in the past year to have the policy rescinded or curtailed, according to ABC. So far, the Trump administration has not done so, Sailhamer said.

Meanwhile, some states have increased calls for PLAs, while others have taken their own measures to limit them.

PennDOT’s bid solicitation for the Markley Street project specifically required PLA agreements with the Building and Construction Council of Philadelphia and Vicinity or the United Steelworkers. Efforts to reach officials with the unions were unsuccessful.

G. David Sload, president and CEO of the ABC Keystone Chapter in Manheim, said in a statement after the January ruling that the PLAs in general discriminate against non-union companies, which “make up an overwhelming majority of Pennsylvania’s construction industry.”

In the statement, he praised the Commonwealth Court ruling. “This is an important step toward instituting a free-enterprise approach to public works contracting,” he wrote.

ABC maintains that construction costs can increase as much as 18 percent because of PLA mandates.

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