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September 28, 2020

Stacking the Deck for Labor Unions

PA Labor Unions Stack the Deck

One of the most considerable costs in taxpayer-funded projects is the cost of labor. Over the years, labor unions have found creative ways to use government regulations to ensure their members benefit from taxpayer spending. Prevailing wage laws, enacted at the state level, increase projects’ cost, and essentially prevent taxpayers from saving money during the bidding process. For more details on prevailing wage, check out this blog from 2012; very little has changed since then.

Project Labor Agreements (PLA’s) limit who can work on a job site, typically to unions’ benefit. PLA’s are banned in twenty-five states, but Pennsylvania isn’t one of them. Responsible Contractor Ordinances (RCO’s) set out training requirements needed to bid on a job. Setting minimum training requirements might sound good on the surface. Still, some ordinances are structured so that only unions meet the training requirements. A case in point is Northampton County’s RCO.

Northampton County government limited its contractor options via an RCO initially in 2018. In September, they compounded the error by reducing the size of the projects covered by the RCO from $250,000 to $100,000. An RCO can stack the deck in favor of unionized contractors with no appreciable benefit to workers or project safety. In this case, the RCO is just a tool to limit competition.

Northampton County only allows bids from firms whose employees complete “Class A” apprenticeship programs and the apprenticeship program must be five or more years old. Class A apprenticeship programs that meet the time requirement are exclusively operated by labor unions In Pennsylvania. Therefore, only unionized firms can bid for work. As a practical example, an open shop or non-union contractor who employed machine operators could have their employees complete Caterpillar’s training program explicitly geared at their piece of equipment. However, unless they also completed a union Class A apprenticeship, then the firm can’t even bid on the project.

Why would Northampton County add these restrictions? And, who was advising the members of the County Council on the matter? The answer to both of those questions is likely two Councilors who have deep ties to organized labor. Councilman Kevin Lott is a retired union Business Manager and a former Trustee for the Philadelphia Carpenters’ Apprenticeship Fund. Councilman William McGee is the Business Manager for an insulators’ union.

How much influence did Lott and McGee have on the RCO update? Given their longstanding relationships, financial and otherwise, with labor unions, how could they possibly have been impartial in supporting these changes? We’ve seen time and again how organized labor, mostly in the form of government unions, have stacked the deck in their favor at the state level. 

What we’re seeing now are new and more creative ways to limit competition and engage in some of the worst kinds of crony capitalism at the local level as well. These local policies have just as much impact on taxpayers, and unfortunately, they go unnoticed until it is too late.