A Project Labor Agreement (PLA) is a type of pre-hire agreement designed to facilitate complex construction projects. Each PLA is negotiated and designed individually – tailored to meet the needs of a specific project or owner/manager. A product of collective bargaining, PLAs govern the work rules, pay rates, and dispute resolution processes for every worker on the project.

A Project Labor Agreement (PLA) between an owner and local trade unions provides for the hiring of qualified construction workers and guarantees labor stability on a construction project.

A PLA requires all employers to sign collective bargaining agreements with the appropriate trade unions for all work on the project. Collective bargaining enables working union members to negotiate with employers on terms of employment, including pay, benefits, hours, leave and safety policies. Employers are able to resolve issues at the bargaining level rather than through conflict, which reduces employee turnover by promoting open communication and job security.

Project labor agreements allow both unionized and non-union companies to bid on projects. The PLA provides the same agreement for all workers and prohibits discrimination by union organizations against non-union job applicants. The PLA allows non-union workers to choose not to become full union members. Non-union workers also may pay reduced union dues or may opt to pay no union dues, depending on the state in which the construction project occurs.

Academic research has shown that PLAs are good for both public and private-sector construction projects, particularly larger projects. The validity of PLAs has consistently been upheld in both federal and state courts. PLAs do not adversely affect the costs of construction projects; rather, they positively influence project timeliness, quality, safety, training, minority employment, employee benefits and labor peace.

PLAs often establish goals or requirements for the inclusion of small businesses, minority contractors and businesses that meet disability requirements. Communities may include local workforce development goals in the PLA to encourage the hiring of targeted segments of the population, such as veterans and minorities. A PLA may include goals or requirements for small business participation in construction projects. Project labor agreements include provisions that require companies to comply with federal and state laws governing workplace safety and health and equal opportunity laws.