Skip to comments.Obama Gives Unions a 'Massive Payback' with Executive Order, Contractors Claim
Posted on 04/30/2010 3:24:34 AM PDT by Man50D
The nations non-union contractors, who constitute the bulk of the construction industry, say President Obama has given a massive payback to unions by implementing an executive order that would help them secure billions of dollars in construction contracts on public projects -- and a House Republican congressman agrees.
The executive order, implemented in mid-April, encourages federal agencies to use project labor agreements or PLAs on their construction projects, which could require any non-union workers to pay into ailing union pension funds and follow work guidelines set out by a union.
Ben Brubeck, who is director of the labor and federal procurement department at the Association of Builders and Contractors (ABC), says the move is unfair to non-union workers who represent about 85 percent of the construction industry.
PLAs basically discourage or cut competition from all of those potential (non-unionized) employees, he said during a news conference this week, while a small group of employees are getting a massive payback and really getting a huge advantage.
Rep. John Kline (R-Minn.), who joined the news conference, agreed, telling CNSNews.com he believed that the new policy saw unions scrambling to make their under-funded pension plans solvent by adding new contributors through PLAs.
Union pension plans, Kline said, are grotesquely under-funded.
(Unions) are desperate, Kline said. "(T)he real solution here is for them to seriously look at the benefits and renegotiate the exorbitant benefits that theyre getting -- in other words tightening their belt --and theyve been unwilling to do that, so theyre scrambling for anything else to make these things solvent.
Brett McMahon, a vice president at Miller & Long Concrete Construction, explained how union pension plans will benefit under PLAs from his private workers, because workers at competitive companies are essentially giving their wages to union retirees.
We would have to divert contributions -- 4 or 5 percent of weekly paycheck, literally --into a pension fund where just by the rules of it -- just by the rules of the vesting schedule, which is a 5 year minimum -- there is absolutely no chance whatsoever that a new worker will be vested during the course of a project. How could anyone possibly rationalize taking 4 or 5 or 6 percent of a guys literal paycheck, and depositing something that he has absolutely no possibility whatsoever of being on?
An employees retirement is vested if he has paid in long enough to mean he can start drawing retirement benefits.
Theres zero, nil, no possibility whatsoever that (the funds) would accrue to the benefit of that individual. Absolutely zero. Its a disgusting concept to take peoples money and its going to some fat retired guy out in the suburbs, McMahon said. Its insane.
Obama signed the executive order in February 2009, expressing his desire to encourage federal agencies to use the PLAs on high-value ($25 million or more) building projects. On April 13, the final rule was printed in the Federal Register.
The terms of a PLA would be set by the union running the work site, and contractors or subcontractors performing tasks on the site would be required to have a contract laying out the terms of the project.
Along with paying into the pension plans, there would be stipulations about wages, workforce composition, and construction timeframes. Limits, for example, will be placed on a contractor's use of non-union labor -- and contractors will have to hire union labor through a hiring hall.
The presidents executive order claims that PLAs, which replace the regular competitive bidding process from contractors, and give it more stability.
The use of a project labor agreement may prevent (various) problems from developing by providing structure and stability to large-scale construction projects, thereby promoting the efficient and expeditious completion of Federal construction grants, the order states.
Brubeck, meanwhile, says imposing PLAs on large projects will only exacerbate labor unrest.
Its absurd because PLAs essentially are being marketed as a way to prevent strikes and (discourage) labor unrest but the unions are the ones that cause them and theyre offering this solution that gives them a monopoly on the job site, which just makes no sense at all, he said.
Unions deny that the new policy represents any favor to them.
That just isnt true, said Tom Owens, communications director of the AFL-CIO building and construction trades department.
(F)or public agencies that are looking to invest their construction dollars, they basically have two different business models to choose from. One is the PLA business model which is a model for job site efficiency, ensuring a local supply of highly-skilled, highly-trained workers and also providing career training opportunities through skilled craft apprenticeship programs.
Now, thats contrasted by the business model thats advocated by the ABC and others, which is: Hey, lets just put together the lowest skilled, lowest wage workforce that we can in a race-to-the-bottom approach that does tremendous damage to communities.
Owens denied Klines and Brubecks suggestion that the new executive order was another case of union favoritism.
No, again -- I mean -- the Obama administration, they looked at the facts, he said. You know, if were going to invest all these tax dollars in these public infrastructure projects . . . it just makes sense to utilize the model thats going to give you project efficiencies, save you on costs and also provide those skilled workforce development opportunities.
But McMahon, meanwhile, contends that use of PLAs will weind up costing more taxpayer money because projects will be costlier. Only 15 percent of construction workers are in union shops, he said.
(The policy) is an attempt to make a market for organized labor because they cant compete in the regular marketplace due to the overall price of the services that they are supposed to be offering. Its really an issue with work rules and the types of things that really add up to huge cost-related issues with them. They could have five guys doing a two man job, that kind of thing."
One guy with a shovel.....12 supervisors looking on.
Is this constitutional? Those non union guys don’t get the union pensions and are forced to pay into the union pensions.
This ought to be challenged in court.
Campaign finance reform is a joke when this kind of bribe-taking is legal.
This is why I look for the “Made in China” label.
Aren’t they required by law to accept the contractor with the lowest bid and doesn’t that pretty much tie Obamas hands? Is it an impeachable offense to ignore that law?
OMG please don’t let me say what I’m thinking. We need to start kicking the legs out from under his little happy stool.
Not if the requirement is changed by the Prez or Congress.
Gee, ya think this will make State & Local construction projects even more expensive? No problem, the bankrupt municipalities will simply pass the cost on to the taxpayer. Yeah, that’s the ticket.
PLA — People’s Liberation Armies
Obama is OWNED by the Unions...especially SEIU and AFL-CIO.....THUGS HANG TOGETHER and support each other.
The Massachusetts offshore wind farm boondoggle is another huge bone thrown to unions. Obamalamadingdong’s minions couldn’t have chosen a more expensive place to build a money wasting project. Plus, it pisses off the Kennedy’s. What a twofer!
This must be another one of Obama's additions to the Alinsky rules. Break so many frikken laws, your opponents don't even no where to start...so they just sit there dumbfounded.
The requirements would be written into the bid documents. It cannot be enforced after a contract award if it wasn’t in the Request For Proposal.
And yes, it will raise the cost of the project. Which, of course, the taxpayers pay.
Cloward and Pivon
It is well to remember that at best, unions are terrorist organizations.
A non union subcontractor who follows the rules is very likely to have his work sabotaged or equipment destroyed or any of several other very costly sabotage efforts.
There will be no attempt to solve the crimes.
Unions are evil .....pure and simple.
Have you ever noticed consideration of the Constitution as a factor in the events of Obama's administration? Why would he start now?
The list, ping