22.503 Policy
Source: FAR 22.503 on acquisition.gov
Federal agencies must require project labor agreements for large-scale construction projects and may do so for smaller projects when it serves federal interests, with specific rules for IDIQ contracts.
Overview
FAR 22.503 establishes the policy for the use of Project Labor Agreements (PLAs) in federal construction projects, implementing Executive Order 14063. The regulation mandates that agencies require PLAs for large-scale federal construction projects to promote efficiency, labor-management stability, and compliance with labor laws. Agencies may also require PLAs for smaller projects if certain conditions are met, and must consider specific factors when making this determination. For IDIQ contracts, PLAs may be required on a per-order basis, especially for orders at or above $35 million, unless an exception applies.
Key Rules
- Mandatory PLAs for Large-Scale Projects
- Agencies must require PLAs for contractors and subcontractors on large-scale federal construction projects unless an exception applies.
- Discretionary PLAs for Smaller Projects
- Agencies may require PLAs for projects below the large-scale threshold if it advances federal interests and is consistent with the law.
- Factors for PLA Appropriateness
- Agencies should consider project complexity, labor shortages, project duration, precedent, workforce training needs, and other relevant factors when deciding on PLAs for smaller projects.
- IDIQ Contracts
- For IDIQ contracts, PLAs may be required per order, and are mandatory for orders at or above $35 million unless an exception applies.
Responsibilities
- Contracting Officers: Ensure PLAs are included in solicitations and contracts as required, assess exceptions, and document decisions.
- Contractors: Comply with PLA requirements and coordinate with labor organizations as specified in the contract.
- Agencies: Evaluate projects for PLA applicability, consider relevant factors, and oversee compliance.
Practical Implications
- This policy aims to streamline construction project management, reduce labor disputes, and ensure legal compliance. Contractors must be prepared to negotiate or adhere to PLAs on qualifying projects, and agencies must carefully document their decisions regarding PLA use. Failure to comply can result in delays or contract issues.
(a) Executive Order (E.O.) 14063, Use of Project Labor Agreements for Federal Construction Projects, requires agencies to use project labor agreements in large-scale construction projects to promote economy and efficiency in the administration and completion of Federal construction projects.
(b) When awarding a contract in connection with a large-scale construction project (see 22.502), agencies shall require use of project labor agreements for contractors and subcontractors engaged in construction on the project, unless an exception at 22.504(d) applies.
(c) An agency may require the use of a project labor agreement on projects where the total cost to the Federal Government is less than that for a large-scale construction project, if appropriate.
(1) An agency may, if appropriate, require that every contractor and subcontractor engaged in construction on the project agree, for that project, to negotiate or become a party to a project labor agreement with one or more labor organizations if the agency decides that the use of project labor agreements will—
(i) Advance the Federal Government's interest in achieving economy and efficiency in Federal procurement, producing labor-management stability, and ensuring compliance with laws and regulations governing safety and health, equal employment opportunity, labor and employment standards, and other matters; and
(ii) Be consistent with law.
(2) Agencies may consider the following factors in deciding whether the use of a project labor agreement is appropriate for a construction project where the total cost to the Federal Government is less than that for a large-scale construction project:
(i) The project will require multiple construction contractors and/or subcontractors employing workers in multiple crafts or trades.
(ii) There is a shortage of skilled labor in the region in which the construction project will be sited.
(iii) Completion of the project will require an extended period of time.
(iv) Project labor agreements have been used on comparable projects undertaken by Federal, State, municipal, or private entities in the geographic area of the project.
(v) A project labor agreement will promote the agency's long term program interests, such as facilitating the training of a skilled workforce to meet the agency's future construction needs.
(vi) Any other factors that the agency decides are appropriate.
(d) For indefinite-delivery indefinite-quantity (IDIQ) contracts the use of a project labor agreement may be required on an order-by-order basis rather than for the entire contract. For an order at or above $35 million an agency shall require the use of a project labor agreement unless an exception applies. See 22.504(d)(3) and 22.505(b)(3).