Recent actions by the state Legislature would bypass limits set by the Massachusetts’ Supreme Judicial Court and give municipalities and public agencies expanded authority to use union-only project labor agreements (PLAs) on public construction projects.

There are good reasons why the SJC placed strict limits on the use of PLAs.  By requiring that all trade labor on a project come from construction unions, they exclude the 81.8% of Massachusetts construction workers who choose not to join a union, thereby reducing competition and driving up costs.

John Cruz, the CEO of Cruz Companies, third-generation minority builders and developers based in Boston, said “PLAs are particularly bad for minority contractors, who tend to be smaller and around 95 percent of whom are open shop.  For Black and brown businesses that have to fight systemic racism, PLAs add another level of discrimination that makes it hard to achieve parity.”

Noting their anti-competitive bias, in Callahan v. City of Malden the SJC set limits on the use of PLAs, ruling: “A project must be of substantial size, duration, timing, and complexity, and the interplay between all four factors must be considered.” The court also said an analysis must be done to show that the PLA meets these factors.

Just last month the Hampden County Superior Court prevented the Springfield Water and Sewer Commission from imposing a PLA on the $325 million construction of the West Parish Water Treatment Plant.

In his ruling, Judge Michael Callan emphasized that “the PLA poses such a significant disadvantage to open shops as to render a competitive bid impossible.”

It’s important to note that not having a PLA in no way limits unions and union contractor from participating.

“Open-shop companies like ours are subject to state certification and local prequalification requirements that apply to all contractors,” said Vera Fernandes Vadeboncoeur of Fernandes Masonry, which was low bidder in its trade for the West Parish Water Treatment project.  “And public construction projects are already covered by state and federal prevailing wage laws that guarantee union-scale wages for all workers, regardless of labor affiliation.”

Fewer bidders mean less competition and higher costs.  A 2021 RAND report on the effects of PLAs on affordable housing production in Los Angeles found a 14.5% increase in construction costs and an 8% increase in overall per unit costs for projects subject to the PLA.

In 2022, Associated General Contractors, a national organization that represents both union and open shop builders, released data on the use of PLAs by the U.S. Department of Defense during the Obama administration, when an executive order encouraging the use of PLAs was in place.  DOD officials found that PLAs “can restrain competition (and) drive up costs,” and that there would be “added expenses associated with the PLA, without offsetting benefits to justify the cost.”

That’s why limits set by the Supreme Judicial Court should remain on state agencies’ and municipalities’ ability to authorize union-only project labor agreements on public construction projects.

Greg Beeman is president of Associated Builders and Contractors of Massachusetts.