No, collaborative examples show PLAs work well in Southwestern Illinois
By DALE STEWART
More than 527 construction projects have been completed using an integrated approach of project labor agreements and Tripartite monthly meetings in Southwestern Illinois. A recently released report clearly defines the multiple business benefits of this process in terms of completing the construction projects on-time, within budget, and with excellent safety records. Contained in the study are six regional business case examples that demonstrate how this process works for contractors, owners and labor.
The study was conducted by Ronda Sauget, D. Mgt, MBA, Webster University and Marv Finkelstein, Ph.D., Southern Illinois University Edwardsville. The purpose was twofold, to provide a framework for understanding the historical context of labor management cooperation and collaboration in Southwestern Illinois, and to empirically document six business cases in the construction industry over the past decade that used the combined PLAs and Tripartite model.
The findings reveal results of increased collaboration, reduced costs, and projects of all sizes representing both public and private investments being brought in on time and within budget with excellent safety records. They also clearly refute the myth that the use of PLAs adds to a project’s cost.
PLAs are used on a wide variety of public and private projects. They result in the creation of a jointly prepared pre-planned framework for labor and management to specify the terms and conditions for a particular project (fair wages and agreeable working conditions). They also are designed to provide pre-job planning to improve a project’s organization and operational activities. Both union and non-union employees and construction companies abide, and strikes, work stoppages, job actions or lockouts of any kind are prohibited. Jurisdictional disputes are resolved quickly. Each PLA is a project-based agreement, so the agreement ends when the project ends. While not all PLAs are the same across the country, the PLAs in Southwestern Illinois are consistent, business-friendly documents that enable companies to meet and exceed the construction objectives of each project.
The term Tripartite is used to define a trilateral or three-way approach, among owners, contractors and unions, to organizing a construction project by first agreeing on the terms of working together collaboratively as specifically outlined in PLAs. The Tripartite approach calls for regular meetings with all stakeholders where everyone sits at the same table. Open lines of communication facilitate sharing of information, ensuring critical issues are addressed promptly. It promotes awareness, respect and mutual trust, resulting in a positive work and construction atmosphere.
The six case studies documented as a part of this year-long study spotlight the effectiveness of the combined PLA/Tripartite approach here. And the evidence is so solid that others may want to consider bringing their projects to Southwestern Illinois so they can avail of the same benefits.
The construction projects detailed in the report include two of North America’s largest projects in recent years — the $4 billion-plus Prairie State Generating Campus and the Phillips 66 $3.8 billion Wood River refinery expansion. The others were Alberici Constructor’s $74 million project to construct Abengoa BioEngery Co.’s ethanol plant at America’s Central Port; multiple projects totaling more than $60 million within the Edwardsville School District; the $11.4 million SIUE Student Success Center, and the new $29 million K-12 facilities for West Washington County School District.
The key findings of the study:
- All six projects reported highly positive results and mutual benefits from engaging in cooperative labor management agreements and practices for the stakeholder groups – owners, contractors and labor.
- The agreements resulted in significant cost savings, improved quality, greater productivity and higher levels of safety.
- There was no evidence to suggest that PLAs contribute to higher costs and reduced competition. To the contrary, successful PLAs tend to produce both short-term and long-term cost savings. Results indicated that all six projects were completed on time and within budget.
- Cooperative agreements, such as PLAs and the Tripartite model, can increase communication, trust, respect and collaboration among all parties and encourage swift problem solving, innovation and flexibility.
The importance of the role of trust and communications in the success of the projects was actually highlighted by several of the individuals interviewed for the study; and within the labor community, we worked extremely hard as a team to overcome any challenges and promote an atmosphere of trust and collaboration.
The study authors attribute the positive results to an informed and committed labor management leadership who were able to successfully resist an adversarial past to learn, create and maintain strong cooperative relationships. They also conclude that the success of the construction industry in Southwestern Illinois may well hinge on workforce and leadership awareness of cooperative and collaborative agreements and practices. That’s great insight to have considering the implications.
In the wake of the study, the Leadership Council, its Labor Management Committee and other regional partners, including the Southwestern Illinois Building and Construction Trades Council, will be working to promote greater awareness and understanding of the use of this project management model, and developing new training and educational programs that focus on cooperative and collaborative practices. Those measures will help to ensure that the study’s findings don’t just gather dust on a shelf, but translate into more projects and more work for local contractors and skilled tradesmen across Southwestern Illinois.
Dale Stewart is executive secretary/treasurer for the Southwestern Illinois Building and Construction Trades Council.