Jersey City’s PLA Ordinance Preempted by NLRA

A Project Labor Agreement requires all construction companies working on a specific project to sign a union contract before being allowed to work on a project. Union companies are already signatory to union contracts, so they suffer no effect. Conversely, non-union companies are essentially required to “become union” for that particular job.

 

Jersey City, New Jersey passed an overtly pro-union city ordinance providing tax abatements to real estate developers that sign Project Labor Agreements (PLAs). Developers who did not sign PLAs, or who developed land using non-union labor, did not receive any tax abatements.

 

Non-union construction contractors claimed that the PLA ordinance effectively set 100% of the tax abatement project work aside for union workforces which made up only 15% of the construction industry. In turn, this drove up construction costs which Jersey City taxpayers had to bear in the form of tax abatements.

 

This PLA was stricken as unlawful. Note to all members of Associated Builders and Contractors and merit-shop construction companies, don’t blindly sign a PLA just to get work. Read it. Understand it. Ensure it is lawful before agreeing to it.

Matt Austin owns Austin Legal, LLC, a boutique law firm based in Ohio that limits its representation to employers dealing with labor, employment, and OSHA matters. You can reach Matt by calling him at (614) 285-5342 or emailing him at Matt@MattAustinLaborLaw.com.

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