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Justices Rule on Labor Agreements for Boston Harbor Cleanup

March 8, 1993

WASHINGTON (AP) _ State agencies may sign master labor agreements covering all contractors in large public works projects, the Supreme Court ruled today in a dispute involving the $6.1 billion Boston Harbor cleanup.

The unanimous decision was a defeat for non-union employers who said such agreements, intended to avoid labor trouble and work delays, bar them from negotiating their own contracts.

Federal labor law allows private property owners to require all contractors on large projects to adhere to a uniform labor agreement. Today’s ruling said state and local government agencies also have that power.

″To the extent that a private purchaser may choose a contractor based upon that contractor’s willingness to enter into a prehire agreement, a public entity as purchaser should be permitted to do the same,″ Justice Harry A. Blackmun wrote for the court.

″In the absence of any express or implied indication by Congress that a state may not manage its own property when it pursues its purely proprietary interests, and where analogous private conduct would be permitted, this court will not infer such a restriction,″ Blackmun wrote.

The case has been closely watched by the federal government and states that have used such labor agreements in a variety of major public projects.

The Boston Harbor cleanup began under a 1985 federal court order after the Massachusetts Water Resources Authority was sued for violating the federal Clean Water Act by discharging sewage.

The cleanup project is expected to take 10 years and cost $6.1 billion.

The authority owns the property on which a sewage treatment plant is to be built. In 1988 it hired Kaiser Engineers Inc., a private contractor, to manage all construction.

With the authority’s approval, Kaiser negotiated a master union agreement in 1989 for the whole project with the Building and Construction Trades Council, an organization of the area’s construction trade unions.

The agreement requires all contractors who win bids to recognize the council as the bargaining representative for all craft employees. Union hiring halls must manage the hiring of union and non-union workers under the plan, which includes a 10-year, no-strike clause.

The agreement was challenged in 1990 by the Associated Builders and Contractors of Massachusetts/Rhode Island, a group of non-union contractors. The association said the master agreement impermissibly interfered with the system of free collective bargaining allowed by federal labor law.

The 1st U.S. Circuit Court of Appeals agreed in a 1991 ruling that said the Massachusetts agency’s master agreement was pre-empted by the National Labor Relations Act.

The Massachusetts agency and the Building and Construction Trades Council appealed. Such master agreements are common in private projects, they said, adding that the non-union contractors had not shown that Congress intended to bar public authorities from making similar agreements.

The Justice Department sided with the Massachusetts agency after being asked by the high court for its views.

In ruling for the Massachusetts agency, the court said today that the state was acting as a property owner, not as a government regulator, in managing the Boston Harbor cleanup. Thus, the justices said, the master agreement was not pre-empted by the federal labor law.

The cases are Building and Construction Trades Council vs. Associated Builders and Contractors, 91-261, and Massachusetts Water Resources Authority vs. Associated Builders and Contractors, 91-274.

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