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NEW YORK CITY-The US District Court for the Southern District of New York found that project labor agreements between New York City and the Building and Construction Trades Council (BCTC), an umbrella organization of approximately 50 construction industry trade unions, do not violate the National Labor Relations Act 29 U.S.C. 151-169, according to an opinion and order from District Judge Robert P. Patterson, Jr. filed on Aug. 4. The project labor agreements, approved in November 2009 by Mayor Michael R. Bloomberg and BCTC president Gary La Barbera, affects $6 billion in infrastructure projects, including the construction of a new police academy and larger 911-call center, according to a prepared statement from the NYC Law Department.

After being voted into law, project labor agreements--or PLAs--involve 32,000 construction jobs, and are expected to save $300 million that would be used to pay for projects that would have otherwise been cut due to the economic downturn, the city says. “This important ruling will allow critical public works-such as the new policy academy-to proceed without interruption, and ensure that future construction projects will be completed in a cost-effective and efficient manner,” says Jonathan S. Becker, deputy chief of the commercial and real estate litigation division, who served as the city’s counsel on this case, in a statement.

PLAs are defined as “a pre-hire collective bargaining agreement between a contractor and a bona fide building and construction trade labor organization establishing the labor organization as the collective bargaining representative,” according the opinion and order. The provisions outlined under the PLAs called for various reforms, improving efficiencies by preventing strikes and standardizing work rules.

The PLAs require most contractors to secure a minimum of 88% of their labor through the BCTC union referral systems and also require contractors to contribute to the union’s fringe benefit funds on behalf of all works in the bargaining unit, the order states.

However, plaintiffs the Building Industry Electrical Contractors Association (BIECA), a trade association of 27 contactors, 16 of which perform publicly financed projects for the city, and the United Electrical Contractors Association (UECA), a trade organization and not-for-profit corporation formed in 1965, consists of 13 contractor-members, of which five perform publicly financed projects for the city, allege that the provisions outlined in the PLA “effectively exclude the contractor-members of the UECA and the BIECA from the competitive bidding process for city construction projects.”

The plaintiffs contend that the PLA requirement that “a contractor must draw 88% of its labor from the signatory BCTC trade union’s hiring hall faces a non-BCTC contractor to work with a ‘stranger’ workforce,” the order states.

The plaintiffs assert that the PLAs require participant contractor unions to pay fringe benefits into BCTC union funds, resulting in BIECA or UECA paying the same fringe benefits twice, once into the BCTC union funds and once into the Building Trades Funds, the order says.

BIECA and UECA plan to appeal the decision, according to attorney Alan Marshall Pollack of Robinson Brog Leinwand Greene Genovese & Gluck PC, representing the plaintiffs. He tells GlobeSt.com that BIECA and UECA has not filed the appeal yet, but association members are currently reviewing the decision and intends to do so in due course. “We are disappointed in the decision, but we intend to appeal to the Second Circuit,” Pollack says.

The history of the city’s PLAs started in 2008, when the New York State Legislature passed New York Labor Law 222 as part of a reform package, the order states. It then sought to reform section 101 of the General Municipal Law, known as the Wicks Law, requiring four prime contractors to be involved in the construction of rehabilitation of a municipal project: electrical, plumbing and mechanical contractors, as well as a general contractor, the order says.

On November 24, 2009, the City and the BCTC had agreed to enter into three PLAs to be in force through 2014. The three PLAs included citywide rehabilitation and renovation of city-owned structures; new construction for the city’s Department of Design and Construction, which applies to eight projects; and new construction for the city’s Department of Sanitation, the order states. After the November announcement, the city and the BCTC executed three additional PLAs for the city’s Department of Environmental Protection, the Department of Parks and Recreation and the Department of Housing Preservation & Development, the order says.

Prior to entering the PLAs with the BCTC, the City commissioned studies from four consultants--including Hill International, the LiRo Group, the Turner Construction Company and Tishman Construction--to evaluate any potential cost savings and efficiencies that might result from the use of a PLA in conjunction with these projects, the order says.

Each study concluded that by obtaining certain union concessions, including standardizing work hours, overtime hours, work shift rules and holidays for each of the various construction trades along with ‘no strike’ provisions and common grievance procedures, the city would realize substantial cost savings on projects covered by these PLAs, according to the order.

In this decision, the Court relied in part on a US Supreme Court decision regarding the clean-up of Boston Harbor which determined that PLAs negotiated to expedite the project were unlawful, the city says. The New York City Law Department's legal team included Becker, Eric P. Jewell and Steven Stein Cushman. Carol O'Rourke Pennington of Colleran O'Hara & Mills, of Garden City, NY, represented the BCTC.

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Federal Court Says BCTC Does Not Violate Nat&#146;l Labor Act

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Federal Court Says BCTC Does Not Violate Natl Labor Act