On August 15, 2025, AGC of America sent a letter to Pres. Trump seeking changes to the mandate for project labor agreements (PLAs) on large-scale federal construction projects and a meeting to collaborate further. AGC has long opposed government initiatives requiring or prohibiting the use of PLAs and maintains that PLA use should be left to the discretion of the contractor. (A copy of AGC’s formal policy on government PLA mandates is available here.) The letter discusses practical problems with the federal mandate and offers practical recommendations for easing the burden on contractors and for advancing economy and efficiency in procurement.
The letter follows a memo issued by the Office of Management and Budget (OMB) on June 12, 2025, clarifying that “the Trump Administration supports the use of PLAs when those agreements are practicable and cost effective, and blanket deviations prohibiting the use of PLAs are precluded.” In AGC’s letter, the association continues to urge the President to completely rescind Pres. Biden’s executive order establishing the mandate, along with the order’s implementing regulations. However, in light of the memo’s indication that rescission is not forthcoming, AGC aims to make implementation of the mandate more fair and workable.
In the letter, AGC discusses the inefficiency, impracticality, and unfairness of requiring all offerors on projects covered by the mandate to submit a PLA with their offers. It also explains problems inherent in the exceptions policy and process, as well as shortcomings with market research questionnaires and transparency. AGC’s recommendations for improvement include:
- Directing contracting agencies to consider alternative PLA submission timing options;
- Giving contractors more time for negotiating a PLA;
- Allowing offerors to submit offers with and/or without a PLA;
- Accept certification of good-faith efforts to negotiate a PLA when PLA settlement cannot be achieved;
- Empowering lower-level contracting agency officials to grant exceptions;
- Standardizing market research questionnaires; and
- Publishing market research results for public access.
The letter reflects widespread concern among AGC’s member firms, many of whom report significant challenges complying with the PLA mandate. An AGC-conducted survey found that 88% of federal contractors believe the mandate increases costs, and 73% are disincentivized from bidding on PLA-required projects. By engaging directly with the administration, AGC hopes to ensure that federal construction remains competitive, cost-effective, and accessible to all qualified contractors.
For more information, contact Denise Gold, VP, Corporate & Labor Legal Affairs, at denise.gold@agc.org.