Federal Judge Orders Department of Defense to Reinstate Project Labor Agreements

The Department of Defense had directed contracting officers in February to halt use of PLAs on large-scale projects, a move that many saw as running counter to the standing executive order. In his decision, Judge Contreras called on the DoD to set aside its PLA-avoidant guidance, even for projects not directly involved in the lawsuit.

The Union Contractor Perspective: Tools, Not Mandates

Stan Kolbe, Executive Director of Government and Political Affairs at the Sheet Metal and Air Conditioning Contractors’ National Association (SMACNA), said his association views PLAs as “an optional construction management tool every owner should be allowed to consider and use where most appropriate.”

“PLAs, while often a highly beneficial contracting strategy, are just that: a strategic tool,” Kolbe told this publication. “Every owner, including DoD, should consider and be able to use [PLAs] at their discretion. While PLAs most often work to boost efficiency, security, and the bottom line, we do not believe the new administration’s DoD should be mandated to use PLAs. Especially where inappropriate but DoD should consider and use them where clearly in their best interests—especially where unique job site employee and contractor security and workforce quality factors dominate.”

Kolbe emphasized that SMACNA’s member firms do not “fear or avoid or sue any project owner when PLAs are, or are not used, it is the owner’s choice.” He added, “Building owners must decide the level of skill quality they wish to have for their project’s workforce as well as the experience level of its contracting and subcontracting team and then make a contract choice it deemed best for the investment.”

The Broader Debate

Supporters of PLAs, including NABTU President Sean McGarvey, say the agreements help stabilize the workforce, improve training and safety, and lead to higher-quality project outcomes. “PLAs aren’t political gimmicks or special-interest carveouts,” McGarvey said in a statement after the ruling. “They are proven workforce development tools that undergird strong economic growth in communities across the country.”

Opponents, most vocally the Associated Builders and Contractors (ABC), argue that PLAs stifle competition and unfairly disadvantage the overwhelming majority of the construction workforce, which is non-union. Kristen Swearingen, ABC’s vice president of government affairs, called the court’s decision “a loss for taxpayers and the nonunion construction industry.”

“ABC respectfully disagrees with the court’s reinstatement of illegal and costly project labor agreement mandates on a wide range of federal construction projects critical to America’s national security,” Swearingen said in a statement, advocating for a move she claims would save up to $10 billion annually through reduced costs. “All government-mandated PLAs should be entirely rescinded by the Trump administration to prioritize efficient use of taxpayer dollars on high-quality, safely built projects over steering contracts to special interests.”

Swearingen further contended that “by discriminating against the 89.7% of the industry workforce that is not unionized, PLAs discourage competition by forcing contractors to sign union collective bargaining agreements, hire workers from union halls and apprenticeship programs and accept compulsory union representation on behalf of any members of their existing workforces.” She warned that non-union workers could lose up to 34% of their compensation unless they join a union and vest in union benefit plans.

Kolbe counters that only a fraction of the industry workforce is employed by firms bidding top security DoD projects, and that provisions in PLAs for the workforce like pensions – while incurring a cost – attract top talent to a highly specialized and elite workforce. Still, non-union contractors who sign on to PLA projects are paying into a pension system that their workers won’t be able to use, unless they join the union, or meet the hour threshold on PLA work to become vested.

“Taxpayers lose when responsible, qualified contractors are effectively and unfairly excluded from bidding on contracts to build essential infrastructure,” Swearingen said. “Americans deserve long-lasting construction projects built safely, on time and on budget by the best contractors and workers, regardless of labor affiliation. ABC will continue to fight for fair and open competition that allows the most qualified contractors and workers to bid for federal work on a level playing field.”

The PLA mandate, she added, “has been widely criticized by the construction industry, taxpayer watchdogs and lawmakers for needlessly inflating construction costs, delaying projects and effectively steering contracts to unionized firms and union labor.”

The legal landscape remains unsettled. Earlier this year, a federal claims court judge sided with employers who argued the Biden order was anti-competitive, but that decision applied only to a handful of contracts. The current ruling compels the DoD to broadly follow the (now-rescinded) executive order while litigation continues, although President Trump formally revoked Biden’s PLA mandate in March 2025. How this interacts with ongoing court orders and agency guidance is still playing out.

Practical Impact Still Unclear

Will the court’s decision mean more PLAs at the Pentagon? Kolbe is cautious: “Perhaps not. Nevertheless, considering the most effective and efficient contracting method for each project should be part of the public (or private) procurement team’s responsibility – with accountability for their choice, if they use a PLA or no PLA.”

Kolbe said delaying projects for litigation or policy disputes “serves no one, especially our industry’s image,” noting that the sector is already contending with numerous federal project pauses, tariff-induced cost overruns and payment issues.

Citing decades of experience, Kolbe added, “It is clear that it is most prudent to at least consider the use of a PLA when deemed the best delivery method by the owner in the best interests of project delivery.”

For now, the Pentagon must return to its prior practice, but how frequently PLAs will be used going forward — and whether the legal battle will continue — remains to be seen.