Project Labor Agreements. September 18, 2012

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1 Project Labor Agreements September 18, 2012

2 Project Labor Agreements - Definitions Pre-Hire Collective Bargaining Agreement Used on Large Complex Construction Projects Employing Multiple Trades Terms and Conditions of Employment for all Trades Used Since 1930 s Public and Private Sector Projects All Unions are Signatory Part of Bid Specs

3 Project Labor Agreements Education and Research Stakeholder Engagement Multiple Meetings since January 2012 County Administrator, County Counsel, General Services, Water Agency, Open Space, Regional Parks North Bay Labor Council North Coast Builders Exchange Associated Builders and Contractors Sonoma, Lake & Mendocino Building Trades Council

4 Project Labor Agreements County Strategic Alignment Pros and Cons of PLAs Common Goals Comparison to Other Counties Successful County Efforts Existing Conditions/Prevailing Wage

5 Project Labor Agreements - County Strategic Alignment Innovation Action Council (2007) Strategic Plan (2010) Board Work Plan (2011 and 2012) Local Preference Policy for Goods and Services (2010) Environmental Purchasing Policy (2010) Job Order Contracting

6 Project Labor Agreements - Pros Avoid Strikes or Work Stoppages Ensure Steady Supply of Labor Increase Local Hiring Provide Dispute Resolution Process Encourage Apprenticeships Assure Uniform Wages & Benefits

7 Project Labor Agreements - Cons Not Necessary Prevailing Wage Laws Increased Project and Administrative Costs Discourages Competition, especially Non- Union Contractors

8 Project Labor Agreements Local Jobs Common Goals Job Training/Apprentice Programs Protect Public Funds Encourage a Diverse Workforce Non-Discrimination in Hiring and Dispatching

9 Project Labor Agreements Other CA Counties California State Association of Counties (CSAC) PLA Survey (March 2012) Results from 11 Counties 3 have Board PLA policy 2 require, 1 prohibits Where policy, triggering thresholds: $1 million and $10 million construction cost 4 have implemented or are implementing projects under PLA 1 County has used a PLA on 13 projects

10 PLA - Job Order Contracting Local Construction Expenditures FY % (1 contract) FY % (3 contracts) FY % (5 contracts) FY % (5 contracts) JOC and Non-JOC Expenditures FY %

11 Sample Prevailing Wage Under PLA Electricians Carpenters Area 1 Operating Engineers Journeyman Rate $46.00 $37.50 $36.35 Pension $5.38 $8.40 $8.26 Health & Welfare $8.25 $9.70 $11.58 Annuity Fund $0.00 ** $0.00 Paid Vacation $0.00 $3.96 $3.66 Apprenticeship $1.00 $0.63 $0.62 Other Payments ** (Typically contribution to Joint Labor Mgt Funds for community support, $0.31 $2.29 $0.73 outreach, advertising.) Total Package/Prevailing Wage $60.94 $62.48 $61.20 Mandatory Representation Fee ($1.95) ($1.60) ($.90) Total Adjusted $58.99 $60.88 $60.30 Optional Monthly Dues (160 hours a month) ($.194) ($.125) ($.394) Optional Initiation Fee (Assumes paid in 1 st month of membership, spread over 160 hours. Actual payment ($.638) ($0) ($6.60) structure varies by affiliation.) Total Adjusted (1 st month only) $58.16 $60.75 $53.31

12 Recommended Policy Elements $25 million Project Budget Workforce Development Core Workers/No Union Membership Requirement Diverse Workforce Non-Discrimination Ensure Benefits for Workers No Labor Related Work Stoppages or Delays One Agreement No Cost Increase to County

13 Recommended Policy Elements (cont.) $25 million Project Budget Consistent with Federal Threshold Complexity of Project Number of Trades Safety and Compliance Significance of Delays Next Project: Sonoma County Airport Runway Improvements Project-$54 million

14 Recommended Policy Elements (cont.) Workforce Development Develop a local, skilled workforce through use of state-approved union and non-union apprenticeship programs and internship programs.

15 Recommended Policy Elements Core Workers Maximize use of local workforce by encouraging all contractors and subcontractors to bid for and be awarded work on County projects without regard to whether they are otherwise parties to collective bargaining agreements Contractors and subcontracts may use their own core workforce (defined as persons on the contractor s or subcontractor s payroll for 60 of the preceding 100 days) Contractors and subcontractors agree to use union hiring halls for any new hires beyond their own core workforce No worker will be required to join a union as a condition of employment, but may be required to pay union representation fees

16 Recommended Policy Elements (cont.) PLA May or May Not Limit Core Workers Advantage to Limit Outside contractor may bring in a large number of Core Workers, decreasing the use of local workers and apprentices. Disadvantage to Limit Local contractor may be required to use workers hired through hall, who may not be county residents.

17 Recommended Policy Elements (cont.) Diverse Workforce Encourage a diverse workforce through outreach to underrepresented businesses and groups, including women, minorities, and veterans

18 Recommended Policy Elements (cont.) Non-Discrimination Ensure no discrimination based on race, national origin, religion, gender, sexual orientation, political affiliation, or membership in a union or labor organization in hiring and dispatching workers for the project

19 Recommended Policy Elements (cont.) Benefits Ensure health, welfare, and retirement benefits are provided for workers

20 Recommended Policy Elements Work Stoppage Guarantee no work stoppages or delays due to labor relations disputes, including union-tounion jurisdictional disputes, and Provide for expedited dispute resolution with no obligation for the County to intervene in the proceedings to resolve the dispute or grievance

21 Recommended Policy Elements (cont.) One Agreement If a PLA or similar project stabilization agreement is pursued, only one agreement per project and all unions must be signatories to the agreement

22 Recommended Policy Elements (cont.) No Cost Increase Ensure that no increase in project costs be incurred by the County related to implementing a PLA or similar agreement

23 Project Labor Agreements - Fiscal Impact Administrative Cost $50,000-$70,000 Initial PLA Negotiation Substantially Less for Future Negotiations Project Cost Double Benefits Less Competition Project Savings Risk Management Safety/Compliance

24 PLA - Process for Board Approval Approve Project and Funding (Typically in Capital Budget) Approve Consultant Contract Approve PLA Approve Plans and Specs, Award Contract to Lowest Responsive and Responsible Bidder.

25 Project Labor Agreements Requested Recommended Action Adopt Policy Next Steps Negotiate PLA on Sonoma County Airport Runway Improvements Project Use as a Template for Future PLAs

26 ~Thank You~

What is the Department of Public Works Project Labor Agreement (DPW-PLA)?

What is the Department of Public Works Project Labor Agreement (DPW-PLA)? City of Los Angeles Department of Public Works PLA / Public Works Infrastructure Stabilization Policy Frequently Asked Questions for Project Labor Agreement 2015-2020 Please note: This document is meant