CEA Issues Statement on Central States Decision Seeks Immediate Congressional Action on Composite Plans

The Construction Employers of America issued the following statement in response to the Treasury Department’s decision to deny the Central States, Southeast and Southwest Areas, Health and Welfare Pension Fund Trustees’ difficult decision to voluntarily request a modification of its pension plan to continue to provide some level of benefit to pension recipients and assure the Fund’s solvency:

The Construction Employers of America is deeply concerned by the Treasury Department’s decision to reject the hard choice the Central States joint labor and management trustees made that would have ensured long-term solvency of the Central States Pension Fund. Mr. Feinberg’s decision creates greater uncertainty for the Trustees, an even more precarious situation for pension recipients, and a very real possibility that deeper cuts will be necessary.

When Congress passed and the President signed the “Multiemployer Pension Reform Act” in 2014, multiemployer pension plan joint labor and management trustees were empowered with the authority to make necessary changes to pension benefits when plans faced insolvency. Plan trustees are best situated to make informed, responsible decisions on behalf of struggling plans to ensure plans’ continued viability.

It is no secret that many of America’s defined benefit plans are floundering, with some facing real and immediate crises. Weak pension plans may create vulnerabilities that weaken the entire pension system. Today’s decision is a wakeup call to Congress, multiemployer benefit plan administrators, and beneficiaries. Given the current status of some plans, current defined benefit plans are too risky for employers and defined contribution plans do not, in reality, provide sufficient guarantees for employees.

The Construction Employers of America reiterates its call for Congress to finish the work it started when it passed the “Multiemployer Pension Reform Act” by authorizing hybrid ‘composite plans’. Composite plans would provide a voluntary option for joint labor and management plan trustees to adopt that would afford a lifetime benefit that would be far superior to a 401(k) for employees while reducing risks for employers. Composite plans were developed jointly by labor and management to meet the evolving needs of today’s workforce, and would allow labor and management trustees to make joint decisions to address market disruptions earlier without the need for draconian measures and slashes in pension benefits to ensure long-term plan solvency.

Construction Employers of America is a joint initiative to coordinate action on labor, workforce, and construction issues facing our industries. CEA will work to strengthen the construction industry and provide opportunities for top-quality construction workers to learn and maintain the skills they need to deliver highly productive, quality workmanship that provides the best value to project owners while earning high-value compensation and benefits for themselves, their families, and their communities. Information about the CEA can be found online at www.constructionemployersofamerica.com.

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CEA Meets with Congressional Building Trades Caucus Discusses Infrastructure, Composite Plans, Apprenticeships, Bid Listing

Washington, DC; April 7, 2016 – This week, members of the Construction Employers of America met with leadership of the recently-established Congressional Building Trades Caucus. CEA representatives discussed federal policy initiatives important to the specialty construction industry with representatives of the Caucus, which is Co-Chaired by Rep. David McKinley (R-WV-01) and Rep. Donald Norcross (D-NJ-01).

The Congressional Building Trades Caucus was launched last month to advance federal policies that support the 6.6 million Americans working in the construction industry. The CEA was pleased to have the opportunity provide early input to the Caucus as it develops its agenda.

CEA discussed with Caucus representatives that highly skilled union building trade shops strengthen the middle class and are good for the country. Most CEA member companies are family owned small businesses that follow the rules and provide superior wages and benefits--including health insurance, pensions, and worker safety investments--for their employees. Issues that CEA raised with the Congressional Building Trades Caucus include the following:

• Promote Sound Infrastructure Policies - Adequate federal dollars to maintain infrastructure is vital to the country, the economy, and the construction industry. Public policy should continue to allow federal agencies to utilize project labor agreements (PLAs) in projects where they determine a PLA would provide the best value and highest quality for federal and federally assisted projects. CEA also supports effective enforcement of prevailing wage and other current laws.
• Modernize Retirement Plan Options - The multiemployer pension system needs to be modernized through congressional authorization of composite plans, which would provide employees lifetime annuity benefits while ensuring predictability for employer contributions.
• Prepare the Next Generation of Skilled Workers - Skilled labor is vital to the success of our industry, and we invest heavily in apprenticeship training programs. Our employers and their labor partners operate over 1,100 apprenticeship training centers nationally and invest over $1.3 billion annually in workforce training and apprenticeship programs.
• Require Bid Listing - Congress should prohibit the practice of post-award bid shopping on low-bid federal construction projects in order to restore equitable safeguards for subcontractors who submit their bids to prime contractors in good faith. Procurement policy should require prime contractors on low-bid solicitations over $1 million to list all subcontractors with work over $100,000 and require prime contractor project winners to use the listed subcontractor at the price listed.
• Oppose Employee Misclassification - Misclassification occurs when an employer improperly classifies and employee as an independent contractor to gain a competitive advantage at the expense of responsible, lawful companies and depriving employees of benefits they deserve. Congress should reform existing tax law to identify bad actors so the federal government can recoup lost tax revenue and ensure all businesses compete under the same rules.

 Construction Employers of America is a joint initiative coordinating action on labor, workforce, and construction issues facing our industries. CEA works to strengthen the construction industry and provide opportunities for top-quality construction workers to learn and maintain the skills they need to deliver highly productive, quality workmanship that provides the best value to project owners while earning high-value compensation and benefits for themselves, their families, and their communities. Information about the CEA can be found online at www.constructionemployersofamerica.com.
 

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Construction Employers of America Urges Authorization of Composite Plans - Composite Plans would Modernize Multiemployer Retirement Benefits

Washington, DC – The Senate Committee on Finance held a hearing today exploring recent reforms and challenges for the multiemployer pension plan system. The Construction Employers of America urged the Committee to provide employers and employees participating in collectively bargained multiemployer plans an additional choice in retirement plan models by authorizing composite plans.

“Authorization of composite plans is the single most important step Congress can take to modernize multiemployer retirement benefits that can meet the evolving needs of both employees and employers in our ever-changing economic environment,” said Jack Jacobson, spokesperson for CEA. “Composite plans were jointly developed by labor and management, have been thoroughly researched, and have undergone extensive stress testing. We urge Congress to authorize composite plans as soon as possible.”

Composite plans combine the best attributes of traditional defined benefit plans that provide lifetime income for retired workers, and 401(k) defined contribution plans, that provide cost predictability and reduced risk for employers. Congress must authorize composite plans before employers and employees can begin using them. Labor and management would voluntarily agree to adopt composite retirement plans. Once Congress authorizes composite plans, the companies that sponsor multiemployer plans will be able to offer safe and secure lifetime benefits to their employees without risking the survival of their businesses.

Last year the House Education and the Workforce Committee held a hearing to examine reforms that would modernize the multiemployer pension system during which composite plans were thoroughly reviewed. Witnesses and stakeholders agreed that composite plans could provide annuitized income for employees while ensuring greater certainty for employers that defined benefit plans lack.

Construction Employers of America is a joint initiative to coordinate action on labor, workforce, and construction issues facing our industries. CEA will work to strengthen the construction industry and provide opportunities for top-quality construction workers to learn and maintain the skills they need to deliver highly productive, quality workmanship that provides the best value to project owners while earning high-value compensation and benefits for themselves, their families, and their communities.

FY17 Budget Supports Accountability, Training; Fails to Capitalize on Construction Opportunities

Washington, DC; February 9, 2016 – The Construction Employers of America today reviewed President Obama’s fiscal year 2017 budget proposal, which would fund important jobs, employment accountability, and workforce training initiatives. CEA members will work with Congress and the Administration to ensure construction projects are fully funded and that policies are implemented that support the country’s specialty construction employers and highly-skilled construction labor force.

The President’s budget includes significant reductions in capital construction for federal buildings and infrastructure projects compared to fiscal year 2016. The 2016 omnibus appropriations bill provided much-needed investments in the country’s aging transportation, energy, and water infrastructure projects and federal buildings. “Now is not the time to backslide on those investments,” said Jack Jacobson, spokesperson for the Construction Employers of America.

CEA is concerned that the President’s 2017 budget is a missed opportunity to build on the construction and infrastructure investments made last year. The construction industry is finally rebounding to pre-recession levels, and now is not the time to stymie the advances that have been made for the economy, construction employees, and the construction industry as a whole.

The President’s budget includes funds to investigate illegal classification of employees as independent contractors, including $10 million “for activities to address the misclassification of workers.” Misclassification is a form of payroll fraud that puts lawful companies that appropriately classify their employees at a competitive disadvantage in the marketplace and unfairly penalizes hard-working Americans who are deprived pay and benefits. “When employees are wrongly classified as independent contractors, the companies that employ them fail to pay appropriate employment taxes, starving jurisdictions of vital revenue and forcing taxpayers and honest companies to make up the difference,” added Jacobson.

The budget includes $90 million for apprenticeship programs, “a proven pathway to the middle class” and “a proven strategy for preparing workers for careers,” according to the President’s budget. This funding would support grants and related funding for apprenticeship programs registered under the National Apprenticeship Act.
The budget would also establish a $2 billion Apprenticeship Training Fund, funded at $400 million per year over five years. The Fund would assist employers who provide apprenticeship training and would support historically underrepresented groups with apprenticeships. The Apprenticeship Training Fund would support the President’s goal of doubling the number of U.S. apprentices, a priority for the Construction Employers of America, whose members make significant investments in workforce training and apprenticeships.

Construction Employers of America is a joint initiative to coordinate action on labor, workforce, and construction issues facing our industries. CEA will work to strengthen the construction industry and provide opportunities for top-quality construction workers to learn and maintain the skills they need to deliver highly productive, quality workmanship that provides the best value to project owners while earning high-value compensation and benefits for themselves, their families, and their communities. Information about the CEA can be found online at www.constructionemployersofamerica.com.

Construction Employers of America Opposes Harmful Anti-Project Labor Agreement Legislation

Washington, DC; January 12, 2016 – The Construction Employers of America registered its opposition to H.R. 1671, the so-called “Government Neutrality in Contracting Act”, being considered today by the House Oversight & Government Reform Committee. This ill-conceived legislation threatens cost-effective and timely completion of taxpayer-funded public construction projects.  Furthermore, the bill would erode the government’s ability to hire contractors’ who employ, develop, and retain highly skilled workers that are vital to our middle class.

Construction Employers of America supports the appropriate use of construction Project Labor Agreements (PLAs) for public construction projects and strongly opposes H.R. 1671. Executive Order 13502 gives government owners the flexibility to use PLAs on a project-by-project basis. H.R. 1671 cannot be considered “neutral.” It would prohibit the use of Project Labor Agreements even if an agency determined it would be the most cost-effective way to ensure high quality construction project is built on-time.

Project Labor Agreements ensure that the federal government selects contractors that can meet all of the terms of the Agreement before a major construction project begins. This greatly reduces the potential for cost overruns. Project Labor Agreements minimize the risk of labor disputes and promote on-schedule and on-budget completion of projects, reducing overall costs and minimizing risks to taxpayers.

PLAs are most often used in the private sector where corporate budget and scheduling decisions are highly scrutinized. PLAs are valued by experienced and cost-conscious owners and large and small construction contractors in the private sector, both union and non-union. Private and public sector PLAs offer a valued and systematic process for methodical planning and scheduling to ensure cost effective construction projects, allowing more accurate bidding and lower costs. Simply put, they provide projects greater certainty and reduce risks for the government and the American taxpayer.

Major projects completed under Project Labor Agreements include the Kennedy Space Center, The Grand Coulee Dam, Washington Nationals Stadium, and the remodel of Logan Airport.

Construction Employers of America supports consideration and use of PLAs where deemed the best economic interest of the project owner on behalf of the taxpayer. Banning the use of PLA’s on large federal projects in past Presidential Administrations may have found favor in some circles, but did not ensure sound construction management. Economics, not ideology, should drive PLA decisions.  We oppose H.R. 1671 and urge the Committee to reject the legislation.

Construction Employers of America is a joint initiative to coordinate action on labor, workforce, and construction issues facing our industries. CEA will work to strengthen the construction industry and provide opportunities for top-quality construction workers to learn and maintain the skills they need to deliver highly productive, quality workmanship that provides the best value to project owners while earning high-value compensation and benefits for themselves, their families, and their communities.

Information about the CEA can be found online at www.constructionemployersofamerica.com.

King Amendment Soundly Defeated Construction Employers Tout Prevailing Rate Wage Benefits

Washington, DC; November 5, 2015 – Yesterday, the U.S. House of Representatives easily defeated an amendment to the surface transportation bill offered by Rep. Steve King (R-IA-04) which would have repealed federal prevailing rate wage requirements for any projects funded by the bill. The decisive 188-238 bipartisan vote against the King Amendment was indicative of the value Members of Congress and their constituents put on Davis-Bacon prevailing rate wage requirements.

“Prevailing rate wage requirements have been the law of the land for over 80 years,” said Jack Jacobson, spokesman for the Construction Employers of America. “Davis-Bacon requires construction companies that contract with the federal government pay a wage that reflects local community wage and benefit practices to ensure employees can earn a living wage. Simply put, Davis-Bacon protects middle class employees.”  

The Davis-Bacon Act was enacted in 1931 and is based on the belief that the government, as a major buyer of construction services, should not drive down wages in a community. DavisBacon prevailing rate wage requirements ensure that skilled workers on federal construction projects receive the locally prevailing rate wage and benefits. It also encourages employers to make investments in workforce training and development, and enhance workplace safety. A long series of reputable economic studies show that prevailing wage regulations do not increase government contracting costs. With the long-term “Surface Transportation Reauthorization and Reform Act of 2015” investing billions of federal dollars in thousands of local construction projects over the next six years, it is imperative that middle class families are paid appropriate wages that reflect their skills and quality work.  

“Construction Employers of America” Launches, Celebrates National Apprenticeship Week

Washington, DC; November 2, 2015 – Today, in conjunction with National Apprenticeship Week, the five premier national construction specialty contracting associations launched the “Construction Employers of America”, a joint initiative to coordinate action on construction, workforce, and labor issues facing their industries. CEA will work to strengthen the construction industry and provide opportunities for top-quality construction workers to learn and maintain the skills they need to deliver highly productive, quality workmanship that provides the best value to project owners while earning high-value compensation and benefits for themselves, their families, and their communities.

“Construction contractors supporting the Construction Employers of America are leading the way, making major investments in America’s world-class workforce through top-quality training and apprenticeship programs,” said Congressman Donald Norcross (D-NJ-01). “As we celebrate National Apprenticeship Week, I want to commend CEA members for supporting well-trained, highly skilled, and well-paid construction workers who meet the quality standards their customers demand and deserve.”

The charter members of the Construction Employers of America include the International Council of Employers of Bricklayers and Allied Craftworkers, the Mechanical Contractors Association of America, the National Electrical Contractors Association, the Sheet Metal & Air Conditioning Contractors’ National Association, and The Association of Union Constructors. CEA firms and workers are best qualified to handle high-skilled projects in a cost-effective manner and are the predominant force in the high end sector of the construction industry.

Signatory contractors and the Building Trades invest over $1 billion annually in apprentice and journey-level training, and invest an additional $10 billion in apprentice wages and benefits. The Buildings Trades’ affiliate unions and their signatory contractors have more than 1,600 training centers in the United States. At a time when many have been foregoing an investment in skilled labor, labor-management apprenticeship programs serve as a global model for providing state-ofthe-art training and the most productive workers.

CEA seeks action on bread-and-butter issues affecting their contractor members—the majority of which are small, family-owned businesses—and their skilled labor force. Among the issues CEA will work with policymakers to address are issues affecting the construction industry and developing a world-class workforce that strengthens the middle class.

Information about the CEA can be found online at www.constructionemployersofamerica.com.