HomeMy WebLinkAboutItem 8.1 City Labor Guidelines:
STAFF REPORT C I T Y C L E R K
DUBLIN CITY COUNCIL File # [~,~$';~-~ ~ ; '^
DATE: December 1, 2009
TO: Honorable Mayor and City Councilmembers
FR~M: Joni Pattillo, City Manager
SUBJECT: City Council Direction Regarding Study of City Labor Guidelines
Prepared By: Sfephen Muzio, Associate Attorney
EXECUTfVE SUMMARY:
The City Council approved, as a high priority_ objective for Fiscal Year (FY) 2009-2010, a study
of the City's labor guidelines on both City projects and private development. The City Council
will receive a brief presentation from staff and provide additional input and clarification of its
objective to enable staff to complete the study.
FINANCIAL IMPACT:
The City's Fiscal Year (FY) 2009-2010 budget inc4uded .100 hours of City Attorney time for
preparation of the report.
RECOMMENDATION:
Staff recommends that the City Council: 1) receive Staff presentation; and 2) provide direction
on the study of City labor guidelines that is part of the City's FY 2009-2010 Goals and
Objectives.
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City Attorney
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Assistant City Manager
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COPY TO:
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DESCRIPTION:
At its June 23, 2009 meeting, the City Council approved a high priority goal to "study ...Labor
Guidelines on both City projects and private development (i.e., pre-qualification, project labor,
apprentice programs, etc.)." Staff is seeking additional input and clarification from the City
Council so that it can proceed with preparing the study. Ultimately, the study will analyze the
City's legal authority to impose labor guidelines on both public .projects and private
development, and the pros and cons of doing so. In preparing the, study, staff plans to engage
the construction industry stakeholders (labor unions, construction industry groups, and the
development community). The study will analyze whether, and to what extent, various
proposals may legally be implemented and the potential costs and benefits to the City of
implementing the proposals. The study will also look at the impact of similar policies in other
cities, and make recommendations regarding the next steps required to implement any policies
the City Council may choose to pursue. Below is a brief description of the items raised in the
Goal's text, as well as a few related concepts that the City Council may wish to have staff
examine.
Pre-Qualification Standards
Ordinarily, cities are required to award contracts on public works to the lowest responsible
bidder. (Public Contract Code, § 20162.) Public Contract Code section 20101 establishes a
process whereby a city can exclude prospective bidders that do not meet the city's standards, a
process known as prequalification. Section 20101 provides, in part, that cities "may require that
each prospective bidder for a contract complete and submit to the entity a standardized
questionnaire and financial statement in a form specified by the entity, including a complete
statement of the prospective bidder's experience in performing public works."
The statute requires that cities utilizing a prequalification process must develop a uniform
system of rating bidders on the basis of the completed questionnaires and financial statements,
and must determine both the minimum requirements permitted for qualification to bid, and the
type and size of the contracts upon which each bidder may bid. Prequalification questionnaires
may request certain information regarding prior compliance with the state's prevailing wage law,
though the scope of such requests is limited in certain respects, with regards to violations of the
prevailing wage law committed by subcontractors. The Legislature's stated intent in adopting
Section 20101 was to ensure a means for local agencies to "evaluate the ability, competency,
and integrity of bidders on public works projects."
Other than the ability to request information regarding compliance with the prevailing wage law,
prequalification is not directly linked to labor guidelines. Nonetheless, staff plans to include a
detailed analysis of the prequalification process in the study. The State Department of
Industrial Relations has drafted some model forms which may be helpful in analyzing
prequalification.
Project Labor Agreements
The text of the goal refers to "project labor," which staff believes refers to project labor
agreements. Project labor agreements ("PLAs" or sometimes called project stabilization
agreements) are a category of agreement between construction project managers and their
workers. PLAs are designed to eliminate delays due to labor strife, to ensure a steady supply of
skilled labor, and to establish a contractually binding means for resolving worker grievances.
PLAs can either involve public or private projects. The terms and provisions of individual PLAs
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vary greatly. Generally, they are pre-hire collective bargaining agreements that are signed
before a project is begun, and before workers are hired to build the project. PLAs generally
include an agreement by the trade union signatories to not conduct any strikes or work
stoppages, while contractors and subcontractors agree to not conduct any lockouts during the
project.
PLAs have historically been utilized in the context of highly complex construction projects that
require a broad range of different skills such as earthmoving, masonry, electrical wiring and
installation of heating and cooling systems. PLAs can contain a variety of provisions, including
ones that: require new employees to pay union dues in return for the union's representation of
employees' interests; require contractors to use a local, centralized union job referral system;
require that a certain number of union apprentices be utilized in the project; establish
management rights including hiring, transfer, discipline and discharge of employees; establish
uniform work schedules; establish work rules and regulations; and establish dispute resolution
procedures to resolve employee, contractor and other disputes.
One limiting factor in the utilization of PLAs by cities is the National Labor Relations Act
("NLRA"). The NLRA is a federal law that generally preempts certain kinds of local labor
regulation activities, though an exception has been carved out in case law for situations where a
local government entity acts in its proprietary capacity to protect or advance its proprietary
interest in a project or transaction. A city acts in a proprietary capacity when it is an owner,
investor or financier, provided that the scope of the actions it takes are specifically tailored to its
designated proprietary interest. Without having done significant research, it is our
understanding that this means that the City could require PLAs on its own public works projects,
but that the City could not require PLAs on purely private development. If so directed by the
City Council, staff would include in the study a detailed analysis of the City's authority to require
PLAs on public and private projects.
Apprenticeship Programs
The Goal references the study of apprenticeship programs. As noted above, some PLAs
contain requirements relating to the hiring and utilization of union apprentices. However, staff is
unaware of other means cities may use to encourage or establish apprenticeship programs
outside of that context. Staff would request that the City Council provide further guidance as to
the kinds of apprenticeship programs it would like studied.
Other Labor Guidelines
In the initial analysis, Staff has not attempted to identify other labor guidelines that could be
imposed on city projects and private development. However, the City Council may desire that
the study look at other labor guidelines beyond those discussed above. For instance, some
cities require contractors to make good faith efforts to hire a certain percentage of residents (so-
called local hire laws). The City Council should provide direction on any other labor guidelines
that it would like included in the study. Depending on the scope of any additional direction from
the City Council, Staff expects to be able to complete its study by spring, 2010.
NOTICING REQUIREMENTS/PUBLIC OUTREACH:
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A copy of this Staff Report was mailed to Chris Stampolis, Director, Community Education &
Government Relations, Laborers' Union, Local 304. As it prepares the study, Staff plans to
engage the construction industry stakeholders (labor unions, construction industry groups, and
the development community). The mechanism for doing so has not yet been determined.
ATTACHMENTS:
None.
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