On the heels of his earlier orders intended to encourage use of unionized labor by federal contractors, President Obama issued E.O. 13502, which is intended to mandate the use of Project Labor Agreements (PLAs) in some federal construction projects.  PLAs typically require the contractor to use only union labor for the project.

The new Order only applies to federal construction projects over $25 million.  It does not mandate PLAs in all circumstances, but allows federal agencies to require their use if they can demonstrate cost or time savings from use of the agreements.  Theoretically, non-union subcontractors could participate in the PLA, and the government agency cannot mandate the use of an agreement with a particular union.

E.O. 13502 repeals two Executive Orders issued by the Bush administration that prohibited federal agencies from requiring PLAs as a condition of awarding the contract.  The new Order is clearly intended to encourage use of unionized labor on federal construction project.  Contractors are concerned that this requirement will result in higher labor costs, and that federal agencies will require use of union-drafted forms for the agreements.