On March 12, 2024, a federal judge in Louisiana dismissed on procedural grounds AGC of America’s lawsuit challenging the Biden administration’s regulation requiring project labor agreements (PLAs) on federal construction projects of $35 million or more. The decision, however, does not prohibit the association from refiling a lawsuit later.
The judge dismissed the suit for lack of standing and improper venue. The judge found that there was inadequate evidence that regulation posed a sufficient “threat of concrete, particularized, or imminent injury” to the business interests of the individual contractors named as plaintiffs. Among the bases stated for that conclusion, the court noted that the regulation gives senior procurement executives in federal agencies the authority to grant exceptions to the PLA mandate and that there is no evidence that they will not grant such exceptions. The court also found that the alleged injuries to the companies’ businesses was too speculative at this juncture because no contractor has yet been denied a contract as a result of this regulation.
While AGC disagrees with the court’s analysis, it is clear that the implementation of the PLA mandate by federal agencies—and whether exceptions are granted—will be weighed heavily in judicial review. In filing this lawsuit, AGC understood that its case could be dismissed on procedural grounds. The association calculated, nevertheless, that the regulation’s harm to its members and the possibility for success far outweighed any decision to delay filing.
AGC is consulting with legal counsel to determine the best path forward. Additional evidence of the negative impact on contractors may be needed. Accordingly, AGC is presently seeking evidence showing:
- Exemptions are denied and/or indications that they are clearly not going to happen;
- Contractors are still uncertain as to when they’ll have to present a PLA, particularly in cases where there’s only a very short time contemplated by the opportunity;
- Examples of procurement agencies providing additional details about what must be required in a PLA;
- Examples of actual PLAs negotiated and submitted with bids;
- Actual attempts by member companies to try to negotiate a PLA that have been rebuffed by the unions; and
- Actual examples of unsuccessful attempts to identify qualified signatory subcontractors.