[Federal Register Volume 74, Number 133 (Tuesday, July 14, 2009)]
[Proposed Rules]
[Pages 33953-33957]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E9-16619]


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DEPARTMENT OF DEFENSE

GENERAL SERVICES ADMINISTRATION

NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

48 CFR Parts 2, 17, 22, 36, and 52

[FAR Case 2009-005; Docket 2009-0024; Sequence 1]
RIN 9000-AL31


Federal Acquisition Regulation; FAR Case 2009-005, Use of Project 
Labor Agreements for Federal Construction Projects

AGENCY: Department of Defense (DoD), General Services Administration 
(GSA), and National Aeronautics and Space Administration (NASA).

ACTION: Proposed rule.

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SUMMARY: The Civilian Agency Acquisition Council and the Defense 
Acquisition Regulations Council (Councils) are proposing to amend the 
Federal Acquisition Regulation (FAR) to implement Executive Order 
(E.O.) 13502, Use of Project Labor Agreements for Federal Construction 
Projects. The new E.O. encourages Federal departments and agencies to 
consider requiring the use of project labor agreements for Federal 
construction projects where the total cost to the Government is more 
than $25 million in order to promote economy and efficiency in Federal 
procurement.

DATES: Interested parties should submit written comments to the 
Regulatory Secretariat on or before August 13, 2009 to be considered in 
the formulation of a final rule.

ADDRESSES: Submit comments identified by FAR case 2009-005 by any of 
the following methods:
    <bullet> Regulations.gov: http://www.regulations.gov. Submit 
comments via the Federal eRulemaking portal by inputting ``FAR Case 
2009-005'' under the heading ``Comment or Submission''. Select the link 
``Send a Comment or Submission'' that corresponds with FAR Case 2009-
005. Follow the instructions provided to complete the ``Public Comment 
and Submission Form''. Please include your name, company name (if any), 
and ``FAR Case 2009-005'' on your attached document.
    <bullet> Fax: 202-501-4067.
    <bullet> Mail: General Services Administration, Regulatory 
Secretariat (VPR), 1800 F Street, NW., Room 4041, ATTN: Hada Flowers, 
Washington, DC 20405.
    Instructions: Please submit comments only and cite FAR case 2009-
005 in all

[[Page 33954]]

correspondence related to this case. All comments received will be 
posted without change to http://www.regulations.gov, including any 
personal and/or business confidential information provided.

FOR FURTHER INFORMATION CONTACT: For clarification of content, contact 
Mr. Ernest Woodson, Procurement Analyst, at (202) 501-3775. For 
information pertaining to status or publication schedules, contact the 
Regulatory Secretariat at (202) 501-4755. Please cite FAR case 2009-
005.

SUPPLEMENTARY INFORMATION:

A. Background

    On February 6, 2009, the President issued E.O. 13502 which 
encourages executive agencies to consider requiring the use of project 
labor agreements in connection with large scale construction projects 
in order to promote economy and efficiency in Federal procurement. The 
E.O. encourages executive departments and agencies to consider the use 
of project labor agreements for construction projects where the total 
cost to the Government is valued at $25 million or more and permits 
agencies on a project-by-project basis to require the use of a project 
labor agreement where certain criteria would be met.
    The term ``project labor agreement'' means a pre-hire collective 
bargaining agreement with one or more labor organizations that 
establishes the terms and conditions of employment for a specific 
construction project and is an agreement described in 29 U.S.C. 158(f).
    The E.O. describes how project labor agreements may help agencies 
manage workforce challenges that arise in connection with large-scale 
construction projects. For example, large-scale construction projects 
typically involve multiple employers at a single location.
    The E.O. explains that a ``lack of coordination among various 
employers, or uncertainties about the terms and conditions of 
employment of various groups of workers, can create friction and 
disputes in the absence of an agreed-upon resolution and mechanism''. 
The use of project labor agreements may ``prevent these problems from 
developing by providing structure and stability to large-scale 
construction projects thereby promoting the efficient and expeditious 
completion of Federal construction contracts.'' A project labor 
agreement may help an agency manage these problems by providing an 
agreed-upon resolution mechanism that promotes the efficient and 
expeditious completion of Federal construction projects.
    In accordance with E.O. 13502, this proposed rule amends the FAR 
to--
    <bullet> Provide a new FAR Subpart 22.5, Use of Project Labor 
Agreements for Federal Construction Projects.
    <bullet> Add a new provision at 52.222-XX, Notice of Requirement 
for Project Labor Agreement, to be included in solicitations where the 
agency has exercised its discretion to require a project labor 
agreement as prescribed at FAR 22.505(a).
    <bullet> Add a new clause 52.222-YY, Project Labor Agreement, to be 
included in contracts in accordance with FAR 22.505(b).
    The Councils invite comment on the process, in which the 
solicitation incorporates the provision providing for submission of the 
project labor agreement prior to the contract award (i.e., should 
agencies require this from each offeror as part of its bid or only from 
an apparent successful offeror).
    The Councils are also considering factors for the contracting 
officer to consider, on a project-by-project basis, in determining 
whether use of a project labor agreement will be in the best interest 
of the Government. The Councils welcome public comment on the factors 
that should be considered, such as the difficulty of coordinating 
multiple contracts in the absence of a project labor agreement, the 
importance of timely project completion, etc.
    The Director of the Office of Management and Budget (OMB) is 
working with the Secretary of Labor and other officials, to provide 
recommendations to the President on whether to broaden the application 
of project labor agreements on both construction projects awarded under 
Federal contracts and construction projects receiving Federal financial 
assistance, to promote the economical, efficient, and timely completion 
of such projects.
    This is a significant regulatory action and, therefore, was subject 
to review under Section 6(b) of Executive Order 12866, Regulatory 
Planning and Review, dated September 30, 1993. This rule is not a major 
rule under 5 U.S.C. 804.

B. Regulatory Flexibility Act

    The Councils do not expect this proposed rule to have a significant 
economic impact on a substantial number of small entities within the 
meaning of the Regulatory Flexibility Act, 5 U.S.C. 601, et seq., 
because the rationale for this determination is based on the 
discretionary nature of the regulation being promulgated and the fact 
that the application of the rule is only in connection with large scale 
construction projects over $25 million (those that would likely impact 
large businesses). Therefore, an Initial Regulatory Flexibility 
Analysis has not been performed. The Councils will consider comments 
from small entities concerning the affected FAR Parts 2, 17, 22, 36, 
and 52, in accordance with 5 U.S.C. 610. Interested parties must submit 
such comments separately and should cite 5 U.S.C. 601, et seq.; (FAR 
case 2009-005), in correspondence.

C. Paperwork Reduction Act

    The Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.) 
addresses the collection of information by the Federal government from 
individuals, small businesses and state and local governments and seeks 
to minimize the burdens such information collection requirements might 
impose. A collection of information includes providing answers to 
identical questions posed to, or identical reporting or record-keeping 
requirements imposed on ten or more persons, other than agencies, 
instrumentalities, or employees of the United States. In accordance 
with the requirements of the Paperwork Reduction Act, agencies may not 
conduct or sponsor, and the respondent is not required to respond to, 
an information collection unless it displays a currently valid Office 
of Management and Budget (OMB) control number or the number appears in 
the Code of Federal Regulations (see FAR 1.106).
    The Paperwork Reduction Act (Pub. L. 104-13) applies because the 
proposed rule contains information collection requirements. 
Accordingly, the Regulatory Secretariat will submit a request for 
approval of a new information collection requirement concerning FAR 
Case 2009-005 to the OMB under 44 U.S.C. Chapter 35, et seq.
    Pursuant to 44 U.S.C. 3506(c)(2)(B), the Councils solicit comments 
concerning: whether these information collection requirements are 
necessary for the Government to properly perform its functions, 
including whether the information has practical utility; the accuracy 
of the estimates of the burden of the information collection 
requirements; the quality, utility, and clarity of the information to 
be collected; and whether the burden of collecting information on those 
who are to respond, including through the use of automated collection 
techniques or other forms of information technology, may be minimized.
    The rule will apply to large-scale construction projects where the 
cost to the Government is $25 million or more and where agencies have 
determined that use of a project labor agreement, in accordance with 
requirements prescribed by this rule, will advance the

[[Page 33955]]

Government's interest in achieving economy and efficiency in the 
resulting procurement. Most prime contractors for such projects are 
large business concerns. We estimate the annual total burden hours as 
follows:
    Based on Fiscal Year 2008 data regarding the types of contracts to 
which this information collection applies, it is estimated that there 
are approximately 300 large-scale construction contracts (including 
Architectural and Engineering contracts) exceeding $25 million that 
could be subject to an agency determination for use of project labor 
agreements. Based on advice of labor advisors, approximately 10 percent 
of these types of projects may be deemed appropriate for a project 
labor agreement. Therefore, it is estimated the information collection 
requirement would apply to approximately 30 large-scale construction 
contracts per year. Each contract would require one project labor 
agreement submission prior to or after award; therefore, the estimated 
number of annual respondents is 30. Project labor agreements are often 
negotiated in advance of the solicitation phase for a procurement, as 
the large-scale projects are defined. The estimated time for reporting 
of this information is 1 hour to cover copying and submitting the 
agreement to the Government.
    We estimate the total annual public cost burden for these elements 
to be $900, based on the following:

 
 
 
Respondents....................................................       30
Responses/respondent...........................................      x 1
                                                                --------
Responses......................................................       30
Hours per response.............................................      x 1
                                                                --------
    Total hours................................................       30
Cost per hour..................................................    x $30
                                                                --------
    Total annual cost to public................................     $900
 

D. Request for Comments Regarding Paperwork Burden

    Submit comments, including suggestions for reducing this burden, 
not later than August 13, 2009 to: FAR Desk Officer, OMB, Room 10102, 
NEOB, Washington, DC 20503, and a copy to the General Services 
Administration, Regulatory Secretariat (VPR), 1800 F Street, NW, Room 
4041, Washington, DC 20405.
    Public comments are particularly invited on: Whether this 
collection of information is necessary for the proper performance of 
functions of the FAR, and will have practical utility; whether our 
estimate of the public burden of this collection of information is 
accurate, and based on valid assumptions and methodology; ways to 
enhance the quality, utility, and clarity of the information to be 
collected; and ways in which we can minimize the burden of the 
collection of information on those who are to respond, through the use 
of appropriate technological collection techniques or other forms of 
information technology.
    Requester may obtain a copy of the justification from the General 
Services Administration, Regulatory Secretariat (VPR), Room 4041, 
Washington, DC 20405, telephone (202) 501-4755. Please cite OMB Control 
Number 9000-00XX, Use of Project Labor Agreements for Federal 
Construction Projects, in all correspondence.

List of Subjects in 48 CFR Parts 2, 17, 22, 36, and 52

    Government procurement.

    Dated: July 9, 2009.
Al Matera,
Director, Office of Acquisition Policy.
    Therefore, the Councils propose amending 48 CFR parts 2, 17, 22, 
36, and 52 as set forth below:
    1. The authority citation for 48 CFR parts 2, 17, 22, 36, and 52 
continues to read as follows:

    Authority: 40 U.S.C. 121(c); 10 U.S.C. chapter 137; and 42 
U.S.C. 2473(c).

PART 2--DEFINITIONS OF WORDS AND TERMS


2.101  [Amended]

    2. Amend section 2.101(b)(2) in the third sentence in the 
definition ``Construction'' by removing the words ``personal property'' 
and adding ``personal property (except that for use in Subpart 22.5, 
see the definition at 22.502).''

PART 17--SPECIAL CONTRACTING METHODS

    3. In section 17.603 revise paragraph (c) to read as follows:


17.603  Limitations.

* * * * *
    (c) For use of project labor agreements, see Subpart 22.5.

PART 22--APPLICATION OF LABOR LAWS TO GOVERNMENT ACQUISITIONS

    4. In section 22.101-1 revise paragraph (b)(2) to read as follows:
* * * * *
    (b)(1) * * * *
    (2) For use of project labor agreements, see Subpart 22.5.
    5. Add Subpart 22.5 to Part 22 to read as follows:

Subpart 22.5 Use of Project Labor Agreements for Federal 
Construction Projects.

Sec.
22.501 Scope of subpart.
22.502 Definitions.
22.503 Policy.
22.504 General requirements for project labor agreements.
22.505 Solicitation provision and contract clause.1
22.501 Scope of subpart.

    This subpart prescribes policies and procedures to implement 
Executive Order 13502, February 6, 2009.


22.502  Definitions.

    As used in this subpart--
    Construction means construction, rehabilitation, alteration, 
conversion, extension, repair, or improvement of buildings, highways, 
or other real property.
    Labor organization means a labor organization as defined in 29 
U.S.C. 152(5).
    Large-scale construction project means a construction project, 
including all contracts associated with the project, where the total 
cost to the Federal Government is $25 million or more.
    Project labor agreement means a pre-hire collective bargaining 
agreement with one or more labor organizations that establishes the 
terms and conditions of employment for a specific construction project 
and is an agreement described in 29 U.S.C. 158(f).


22.503  Policy.

    Project labor agreements are a tool that agencies may use to 
promote economy and efficiency in Federal procurement. Pursuant to 
Executive Order 13502, agencies are encouraged to consider requiring 
the use of project labor agreements in connection with large-scale 
construction projects.


22.504  General requirements for project labor agreements.

    (a)(1) Agencies may require the use of project labor agreements 
where use of such 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) If an agency determines that use of a project labor agreement 
will meet the standards set forth in paragraphs (a)(1)(i) and (ii) of 
this section, the agency has complete discretion--

[[Page 33956]]

    (i) To require that every contractor and subcontractor on the 
project agree, for that project, to negotiate or become a party to a 
project labor agreement with one or more appropriate labor 
organizations; or
    (ii) To decide not to require the use of a project labor agreement.
    (b) Project labor agreements established under this subpart shall--
    (1) Bind all contractors and subcontractors on the construction 
project to comply with the project labor agreement;
    (2) Allow all contractors and subcontractors to compete for 
contracts and subcontracts without regard to whether they are otherwise 
parties to collective bargaining agreements;
    (3) Contain guarantees against strikes, lockouts, and similar job 
disruptions;
    (4) Set forth effective, prompt, and mutually binding procedures 
for resolving labor disputes arising during the term of the project 
labor agreement;
    (5) Provide other mechanisms for labor-management cooperation on 
matters of mutual interest and concern, including productivity, quality 
of work, safety, and health; and
    (6) Fully conform to all statutes, regulations, and Executive 
orders.


22.505  Solicitation provision and contract clause.

    (a)(1) For acquisition of large-scale construction projects, if the 
agency makes a determination pursuant to this subpart that a project 
labor agreement will be required, the contracting officer shall insert 
the provision at 52.222-XX, Notice of Requirement for Project Labor 
Agreement, in all solicitations associated with the project.
    (2) If an agency allows submission of the project labor agreement 
after contract award, the contracting officer shall use the provision 
with its Alternate I in accordance with agency procedures.
    (b)(1) For acquisition of large-scale construction projects, if the 
agency makes a determination pursuant to this subpart that a project 
labor agreement will be required, the contracting officer shall insert 
the clause at 52.222-YY, Project Labor Agreement in all contracts 
associated with the project.
    (2) If an agency allows submission of the project labor agreement 
after contract award, the contracting officer shall use the clause with 
its Alternate I in accordance with agency procedures.

PART 36--CONSTRUCTION AND ARCHITECT-ENGINEER CONTRACTS

    6. In section 36.202 revise paragraph (d) to read as follows:


36.202  Specifications.

* * * * *
    (d) For requirements on the use of project labor agreements for 
Federal construction projects, see part 22, Subpart 22.5 of this 
chapter.
* * * * *

PART 52--SOLICITATION PROVISIONS AND CONTRACT CLAUSES

    7. Add section 52.222-XX to read as follows:


52.222-XX  Notice of Requirement for Project Labor Agreement.

    As prescribed in 22.505(a)(1), insert the following provision:

NOTICE OF REQUIREMENT FOR PROJECT LABOR AGREEMENT (DATE)

    (a) Definitions. Labor organization and project labor agreement, 
as used in this provision, are defined in the clause of this 
solicitation entitled Project Labor Agreement.
    (b) Consistent with applicable law, the apparent successful 
offeror will be required to execute a project labor agreement with 
one or more appropriate labor organizations for the term of the 
resulting construction contract.
    (c) Any project labor agreement reached pursuant to this 
provision shall--
    (1) Bind the offeror and all subcontractors on the construction 
project to comply with the project labor agreement;
    (2) Allow the offeror and all subcontractors to compete for 
contracts and subcontracts without regard to whether they are 
otherwise parties to collective bargaining agreements;
    (3) Contain guarantees against strikes, lockouts, and similar 
job disruptions;
    (4) Set forth effective, prompt, and mutually binding procedures 
for resolving labor disputes arising during the project labor 
agreement;
    (5) Provide other mechanisms for labor-management cooperation on 
matters of mutual interest and concern, including productivity, 
quality of work, safety, and health; and
    (6) Fully conform to all statutes, regulations, and Executive 
orders.
    (d) Any project labor agreement reached pursuant to this 
provision does not change the terms of this contract or provide for 
any price adjustment by the Government.
    (e) The Government will not participate in the negotiations of 
any project labor agreement.
    (f) The apparent successful offeror shall submit to the 
Contracting Officer a copy of the project labor agreement--reached 
pursuant to this provision prior to contract award.


(End of Provision)

    Alternate I (DATE) As prescribed in 22.505(a)(2), substitute the 
following paragraph (b) in lieu of paragraphs (b) through (f) of the 
basic clause:

    (b) Consistent with applicable law, the contractor agrees to 
bargain in good faith to a project labor agreement with one or more 
appropriate labor organizations for the term of the resulting 
construction contract.

    8. Add section 52.222-YY to read as follows:


52.222-YY  Project Labor Agreement.

    As prescribed in 22.505(b)(1), insert the following clause:

PROJECT LABOR AGREEMENT (DATE)

    (a) Definitions. As used in this clause--
    Labor organization means a labor organization as defined in 29 
U.S.C. 152(5).
    Project labor agreement means a pre-hire collective bargaining 
agreement with one or more labor organizations that establishes the 
terms and conditions of employment for a specific construction 
project and is an agreement described in 29 U.S.C. 158(f).
    (b) The Contractor shall maintain in a current status throughout 
the life of the contract the project labor agreement entered into 
prior to the award of this contract in accordance with solicitation 
provision 52.222-XX, Notice of Requirement for Project Labor 
Agreement.
    (c) Subcontracts. The Contractor shall include the substance of 
this clause, including this paragraph (c), in all subcontracts.


(End of Clause)

    Alternate I (Date). As prescribed in 22.505(b)(2), substitute the 
following paragraphs (b) through (g) for paragraphs (b) and (c) of the 
basic clause:

    (b) Consistent with applicable law, the contractor agrees to 
bargain in good faith to a project labor agreement with one or more 
appropriate labor organizations for the term of this construction 
contract. The contractor shall submit an executed copy of the 
project labor agreement to the Contracting Officer.
    (c) Any project labor agreement reached pursuant to this clause 
shall--
    (1) Bind the Contractor and all subcontractors on the 
construction project to comply with the project labor agreement;
    (2) Allow the Contractor and all subcontractors to compete for 
contracts and subcontracts without regard to whether they are 
otherwise parties to collective bargaining agreements;
    (3) Contain guarantees against strikes, lockouts, and similar 
job disruptions;
    (4) Set forth effective, prompt, and mutually binding procedures 
for resolving labor disputes arising during the project labor 
agreement;
    (5) Provide other mechanisms for labor-management cooperation on 
matters of mutual interest and concern, including productivity, 
quality of work, safety, and health; and
    (6) Fully conform to all statutes, regulations, and Executive 
orders.
    (d) Any project labor agreement reached pursuant to this 
provision does not change the terms of this contract or provide for 
any price adjustment by the Government.
    (e) The Government will not participate in the negotiations of 
any project labor agreement.

[[Page 33957]]

    (f) The Contractor shall maintain in a current status throughout 
the life of the contract the project labor agreement entered into 
pursuant to this clause.
    (g) Subcontracts. The Contractor shall include the substance of 
this clause, including this paragraph (g), in all subcontracts.


(End of Provision)

[FR Doc. E9-16619 Filed 7-10-09; 11:15 am]
BILLING CODE 6820-EP-P