The National Labor Relations Act of 1935 (NLRA) gives most private sector workers the right to join or form a labor union and to bargain collectively over wages, hours, and working conditions. The act allows workers in the construction industry to enter into a collective bargaining agreement (CBA) before a project begins. A project labor agreement (PLA) is a collective bargaining agreement that applies to a specific construction project and lasts only for the duration of the project. In February 2009, President Barack Obama signed Executive Order 13502, which encourages federal agencies "to consider requiring" the use of PLAs on large-scale construction projects. Regulations implementing the Executive Order (EO) went into effect in May 2010. A PLA generally specifies the wages and fringe benefits to be paid on a project. A PLA may require contractors to hire workers through a union hiring hall. If not, it may require employees to become union members after being hired. PLAs usually include a provision that unions agree not to strike and contractors agree not to lock out workers. The EO defines large-scale projects as those where the total cost to the federal government is $25 million or more. The order states that agencies are not required to use PLAs. A PLA shall 
bind all contractors and subcontractors on a construction project to comply with the PLA; allow all contractors and subcontractors to compete for contracts and subcontracts whether or not they are otherwise a party to a collective bargaining agreement; contain guarantees against strikes, lockouts, and similar job disruptions; provide binding procedures for resolving labor disputes that may arise during the term of the PLA; provide other mechanisms for labor and management cooperation on matters of mutual interest and concern, such as productivity, quality of work, safety, and health; and include any additional requirements that an agency deems necessary. Advantages and Disadvantages of PLAs

Proponents of PLAs argue that the agreements have several advantages, including the following:
A PLA provides uniform wages, benefits, overtime pay, hours, working conditions, and work rules for work on major construction projects. A PLA provides contractors with a reliable and uninterrupted supply of workers at predictable costs for wages and benefits. Because labor costs are predictable and because a PLA makes it easier to manage a large project, a PLA helps ensure that a project will be completed on time and on budget. Opponents argue that PLAs have several disadvantages:
PLAs can increase costs. If a PLA requires contractors to hire workers through a union hiring hall, contractors may not be able to use their own workers. If a contractor is able to use his own workers, the workers may have to join a union and pay union dues. If a contractor has to pay into a union pension plan, the employees may not be on the project long enough to vest in the plan. Nonunion contractors may operate more efficient worker training programs. Evidence does not indicate that nonunion construction projects are less safe than union projects. The Economic Effects of PLAs

Opponents and proponents of PLAs disagree on the economic effects of PLAs. In short, much of the research on the effect of PLAs on the costs of construction is inconclusive. In part, it can be difficult to find similar projects where some use a PLA and the others do not. Instead of comparing similar projects, economists use statistical models that attempt to control for differences in the characteristics of construction projects. It can be difficult, however, to control for all the factors that affect the costs of construction. For example, if the Davis-Bacon locally prevailing wage is the local union wage, contractors may pay workers the union wage whether or not the project is covered by a PLA. In addition, statistical models may not take into account the quality of construction, whether projects are finished on time, or the safety records of different projects. Finally, the relationship between PLAs and construction costs may be interdependent. PLAs may affect construction costs, but the size and cost of construction may also affect the use of PLAs.
The National Labor Relations Act (NLRA) gives most private sector workers the right to join or form a labor union and to bargain collectively over wages, hours, and working conditions. The act allows workers in the construction industry to enter into a collective bargaining agreement before a project begins. A project labor agreement (PLA) is a collective bargaining agreement that applies to a specific construction project and lasts only for the duration of the project.
In February 2009, President Barack Obama signed an Executive Order (EO) that encourages federal agencies "to consider requiring" the use of PLAs on large-scale construction projects. The EO defines a large-scale project as one where the total cost to the federal government is $25 million or more. The order states that agencies are not required to use PLAs. Regulations implementing the EO went into effect in May 2010.
A PLA generally specifies the wages and fringe benefits to be paid on a project, and it usually includes procedures for resolving labor disputes. PLAs generally include a provision that unions agree not to strike and contractors agree not to lock out workers. A PLA may require contractors to hire workers through a union hiring hall. If not, it may require employees to become union members after being hired. A PLA applies to all contractors and subcontractors on a project.
Opponents and proponents of PLAs disagree on the economic effects of PLAs. Supporters argue that the agreements provide uniform wages, benefits, overtime pay, hours, working conditions, and work rules for work on major construction projects. They maintain that PLAs provide contractors with a reliable and uninterrupted supply of workers at predictable costs for wages and benefits, and they argue that a PLA makes it easier to manage a large project, which ensures that it will be completed on time and on budget. Supporters also say that PLAs help train workers, improve worker safety, and ensure compliance with labor and health and safety laws.
Opponents argue that PLAs have several disadvantages. They argue that PLAs increase construction costs. Nonunion contractors may not bid on projects that are covered by a collective bargaining agreement or, when they bid, they cannot win contracts on the basis of lower costs. If they have to hire workers through a union hiring hall, contractors may not be able to use their own workers. A nonunion contractor's workers may have to join a union and pay union dues. When a contractor has to pay into a union pension plan, employees may not be on the project long enough to vest in the plan. PLA opponents also argue that nonunion contractors can operate more efficient worker training programs and that evidence does not indicate that nonunion construction projects are less safe than union projects. Finally, opponents argue that federal and state agencies enforce labor and workplace health and safety laws.
Much of the research on the effect of PLAs on the costs of construction is inconclusive. In part, it can be difficult to find similar projects where some use a PLA and the others do not. Instead of comparing similar projects, economists often use statistical models that attempt to control for differences in the characteristics of the projects. It can be difficult, however, to control for all the factors that affect the costs of construction. For example, if the Davis-Bacon locally prevailing wage is the local union wage, contractors may pay workers the union wage whether or not the project is covered by a PLA. In addition, statistical models may not take into account the quality of construction, whether projects are finished on time, or the safety records of different projects. Finally, the relationship between PLAs and construction costs may be interdependent. PLAs may affect construction costs, but the size and cost of construction may also affect the use of PLAs.