Missouri Senate Bill 182 Prohibits Use Of Project Labor Agreements For School Construction Projects

Senate Bill No. 182

On Tuesday, May 30, 2017, Governor Greitens signed Missouri Senate Bill 182 (“SB 182”).  This new measure essentially prohibits all political subdivisions of the State of Missouri from entering Project Labor Agreements (“PLAs”) for public works projects.

Project Labor Agreements

A PLA is a collective bargaining agreement that requires public construction projects (e.g., building schools) to be performed only by contractors that assent to sign a labor union agreement for that project.  Through the use of PLAs, companies are required to pay union wages to their workers when they carry out publically funded construction projects. Although both union and non-union contractors can bid on projects, non-union contractors are required to pay union wages when there is a PLA in place.

Application of the New Law

For now, current law prohibits the use of PLAs on only state projects.  Beginning August 28, 2017, the new law goes into effect and extends the prohibition to all political subdivisions of the State, including school districts.  At that time, if a subdivision of the State requires a PLA or requires non-union contractors to pay union dues when working on a local construction project, that political subdivision will lose all of its state funding for two years.  That said, the new law will only apply to projects that are more than fifty percent (50%) funded by the State.

No Change in Prevailing Wage Law

SB 182 does not impact Missouri’s state prevailing wage law, which requires union and nonunion contractors and subcontractors providing construction services on public works contracts to pay construction workers at least a government-determined wage rate. Although Missouri’s prevailing wage rates are often established by collective bargaining agreements with unions, all public works contractors will still be required to pay Missouri’s prevailing wage rates after SB 182 becomes law.

For more information, please contact Conor Neusel.

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