Building and Const. Trades Dept. v. Allbaugh

• Decision Date: 07 November 2001
• Docket Number: No. 01-0902(EGS).,01-0902(EGS).
• Citation: 172 F.Supp.2d 138
• Parties: BUILDING AND CONSTRUCTION TRADES DEPARTMENT, AFL-CIO, et al., Plaintiffs, v. Joe M. ALLBAUGH, Director Federal Emergency Management Agency, et al., Defendants.
• Court: U.S. District Court — District of Columbia

172 F.Supp.2d 138

BUILDING AND CONSTRUCTION TRADES DEPARTMENT, AFL-CIO, et al., Plaintiffs, v. Joe M. ALLBAUGH, Director Federal Emergency Management Agency, et al., Defendants.

No. 01-0902(EGS).

United States District Court, District of Columbia.

November 7, 2001.

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Laurence J. Cohen, Esquire, Terry R. Yellig, Esquire, Victoria L. Bor, Esquire, Jonathan D. Newman, Esquire, Sherman, Dunn, Cohen, Leifer & Yellig, P.C., Washington, DC, for Plaintiffs.

Raymond Larizza, Esquire, Senior Trial Counsel, U.S. Department of Justice, Washington, DC, for Defendants.

Arnon D. Siegel, Esquire, Robbins, Russell, Englert, Orseck & Untereiner, Washington, DC, for amicus New York State Thruway Authority.

Kristian M. Dahl, Esquire, National Right to Work, Springfield, VA, for amicus National Right to Work Legal Defense Foundation.

Maurice Baskin, Esquire, Venable, Baetjer, Howard & Civiletti, LLP, Washington, DC, for amicus Associated Builders, Inc., et al.

Terri E. Gerstein, Esquire, Attorney General of the State of New York, New York, NY, for amicus State of New York.

Stanley Mallison, Esquire, Milberg, Weiss, Bershad, Hynes & Lerach, LLP, San Francisco, CA, for amicus National Economic Development & Law Center and the Sierra Club.

Linda D. Strozyk, Deputy Counsel, Michael D. Berman, Deputy Chief of Litigation, Edward S. Harris, Counsel, Kevin Reynolds, Asst. Atty. Gen., Maryland Department of Transportation, Baltimore, MD, for amicus Maryland Department of Transportation.

Kirsten Engel, Esquire, Assistant Attorney General, Boston, MA, for amicus the Commonwealth of Massachusetts.

MEMORANDUM OPINION

SULLIVAN, District Judge.

Plaintiffs Building and Construction Trades Department of the AFL-CIO ("BCTD"), Contra Costa Building and Construction Trades Council ("Contra Costa BCTC"), and the City of Richmond ("Richmond") commenced this lawsuit to enjoin the enforcement of Executive Order 13202 ("EO 13202"), issued by President George W. Bush on February 17, 2001. EO 13202 prohibits federal agencies or recipients of federal funding from requiring or prohibiting Project Labor Management Agreements ("PLAs") in the bid specifications or other authorizing documents for construction contracts. Plaintiffs argue that EO 13202 is without authority and is preempted by the National Labor Relations Act ("NLRA"). Plaintiffs have named as defendants the federal agencies that are tasked with implementing EO 13202 and that provide funding subject to EO 13202 for construction projects in which the plaintiffs are involved.

Pending before the Court are cross-motions for summary judgment. Upon consideration of the parties' motions, oppositions, replies, and counsels' representations at oral argument, the motions by amicus curiae, as well as the applicable statutory and case law, the Court concludes that the plaintiffs' motion for summary judgment and for permanent injunctive relief must be GRANTED and the defendants' motion for summary judgment must be DENIED. Constitutional and statutory precedent of longstanding persuades the Court that the President lacked the requisite authority for Executive Order 13202. Accordingly, enforcement of EO 13202 is permanently enjoined.

BACKGROUND

1. Project Labor Management Agreements

Executive Order 13202 prohibits federal agencies and recipients of federal funding from requiring or prohibiting PLAs in the implementing documents for construction projects. Exec. Order No. 13,202, 66 Fed. Reg. 11225 (February 22, 2001), amended by Exec. Order No. 13,208, 66 Fed.Reg. 18717 (April 6, 2001). PLAs are "pre-hire" collective bargaining agreements that are generally prohibited by the NLRA. Contractors or owners and labor unions in the construction industry, however, are explicitly exempted from that prohibition. See 29 U.S.C. § 158(e)-(f) (2001). A PLA is negotiated between an employer that has control over a particular construction project and a group of unions in order to meet the specific labor needs of that project. PLAs bind all contractors and subcontractors to a variety of provisions, which generally include: (1) recognition of signatory unions as sole representatives of covered workers; (2) prohibition of strikes and lockouts; (3) a dispute resolution process; (4) uniform rules on overtime and working hours; (5) hiring through union referral systems; and, (6) set wages for craft workers. See United States General Accounting Office, Report to Congressional Requesters, Project Labor Agreements: The Extent of Their Use and Related Information (May 1998).

PLAs are generally negotiated at the beginning of a construction project. Once an agreement has been reached, the employer will award contracts only to those contractors and subcontractors who agree to abide by the PLA. The process by which the PLA is negotiated and the contracts are awarded differs slightly depending on whether an employer is a private or public entity.

Private employers may negotiate directly with labor unions to create a PLA that will bind all contractors and subcontractors on a project to its terms. The employer can then either simply hire contractors who agree to abide by those terms, or grant the contracts through a competitive bidding process. If there is a bidding process, the employer will include the PLA in the bid specifications as a material requirement.

For public entities, the process is slightly more complicated. The process includes assessing the value of a PLA for a particular project, selecting a construction or project manager to negotiate and implement the agreement, negotiating the agreement, reviewing the agreement, and enforcing the agreement. Most public entities by law must use a competitive bid process to award contracts. See Mem. of Law of Amicus Curiae New York State Thruway Authority. A negotiated PLA is enforced by including it in the bid specifications for the project. Most state competitive bidding statutes require that a PLA be included in the bid specifications for a project as a material condition. Id. at 5 n. 6.

In the absence of a PLA, individual unions and individual contractors can negotiate pre-hire agreements that set the terms and conditions for the workers and subcontractors who work for that particular contractor. However, these individual pre-hire agreements are not PLAs in that they can not establish uniform standards for an entire project.

2. EO 13202

Section 1 of EO 13202 applies to federal agencies who award construction contracts, and specifies the substantive prohibitions of the EO. Section 3 of EO 13202 applies to recipients of federal funding and incorporates the prohibitions of § 1:

Section 1. To the extent permitted by law, any executive agency awarding any construction contract after the date of this order, or obligating funds pursuant to such a contract, shall ensure that neither the awarding Government authority nor any construction manager acting on behalf of the Government shall, in its bid specifications, project agreements, or other controlling documents:

(a) Require or prohibit bidders, offerors, contractors, or subcontractors to enter into or adhere to agreements with one or more labor organizations, on the same or other related construction project(s); or

(b) Otherwise discriminate against bidders, offerors, contractors, or subcontractors for becoming or refusing to become or remain signatories or otherwise to adhere to agreements with one or more labor organizations, on the same or other related construction project(s).

(c) Nothing in this section shall prohibit contractors or subcontractors from voluntarily entering into agreements described in subsection (a).

Sec. 3. To the extent permitted by law, any executive agency issuing grants, providing financial assistance, or entering into cooperative agreements for construction projects, shall ensure that neither the bid specifications, project agreements, nor other controlling documents for construction contracts awarded after the date of this order by recipients of grants or financial assistance or by parties to cooperative agreements, nor those of any construction manager acting on their behalf, shall contain any of the requirements or prohibitions set forth in section 1(a) or (b) of this order.

Executive Order 13202, 66 Fed.Reg. 11225 (February 22, 2001). EO 13202 states that its authority lies in "the Constitution and laws of the United States of America, including the Federal Property and Administrative Services Act, 40 U.S.C. 471 et seq." Id.

EO 13202 superceded President Clinton's June 1997 memorandum, which directed that executive agencies "may, on a project-by-project basis, use a project labor agreement on a large and significant project" when that agency determines it will "advance the Government's procurement interest in cost, efficiency and quality and in promoting labor-management stability ..." President's Memorandum, "The Use of Project Labor Agreements for Federal Construction Projects" at 1, 1997 WL 309842 (June 5, 1997). The memorandum filled the vacuum created when President Clinton repealed the former President George Bush's Executive Order 12818¹, which explicitly prohibited the use of the PLAs in contracts in which federal agencies were parties. See "Revocation of Certain Executive Orders Concerning Federal Contracting," Exec. Order No. 12,836, 58 Fed.Reg. 7045 (Feb. 1, 1993), revoking Exec. Order No. 12818, 57 Fed.Reg. 48713 (Oct. 23, 1992).

3. Plaintiffs

Plaintiff BCTD is a an organization within the AFL-CIO consisting of fourteen national and international unions representing more than one million employees in construction and related industries throughout the United States and Canada. See Pls.' Motion for Summ. J., Ex. 4 (Second Decl. of Edward C. Sullivan). BCTD is the parent organization to over 300 local building and construction councils in the United States, including the Contra Costa BCTC, also a plaintiff here. Id. The...