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Legally Binding: New Project Labor Agreement Requirement for Large-Scale Federal Construction

Under Executive Order from February 4, 2022, Project Labor Agreements (PLAs) will be required for any federal government construction project of approx. $35 million or more, starting immediately.

This new executive order comes on the heels of the historic Infrastructure Investment and Jobs Act passed in November 2021, which has financed large-scale federal projects across the country. Any contractors or agencies looking to get in on opportunities from the new law will need to keep this recent Order in mind.

Defining Project Labor Agreements

A PLA generally refers to a pre-hiring collective bargaining agreement amongst contractors and trade unions that sets terms and conditions of employment for a specific construction project before agencies begin bidding on the project.

For projects that fall under this Executive Order, the PLA must:

  • Bind all contractors and subcontractors on the construction project through the inclusion of appropriate specifications in all relevant solicitation provisions and contract documents;
  • Allow all contractors and subcontractors on the construction project to compete for contracts and subcontracts without regard to whether they are otherwise parties to collective bargaining agreements;
  • Contain guarantees against strikes, lockouts, and similar job disruptions;
  • Set forth effective, prompt, and mutually binding procedures for resolving labor disputes arising during the term of the project labor agreement;
  • Provide other mechanisms for labor-management cooperation on matters of mutual interest and concern, including productivity, quality of work, safety, and health; and
  • Fully conform to all statutes, regulations, Executive Orders, and Presidential Memoranda.


It should be noted, however, that the Executive Order will NOT affect state or local projects, even those financed by the bill. So, New York City or New York State infrastructure projects will not require a PLA, unless they so choose to use one.

In addition, a senior official within an agency may grant an exception from the PLA requirement if it:

  • Substantially excludes potential bidders from the project
  • Clashes with another federal law, Executive Order, etc.
  • Would lead to significant hold ups and inefficiency (such as for a short-term project)

With this in mind, contractors and agencies looking to get in on the upcoming influx of infrastructure projects should be sure to check if the project requires a PLA, and look over all terms before bidding.

For more guidance on how the latest construction and building code developments may affect your project, please reach out to the experts at Outsource Consultants.



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