Unions have been part of U.S. history for hundreds of years, contributing to the development of many industries, but they’re currently in decline. However, union affiliation is higher in the construction industry (12.7%) compared to the national average of 10.8%. Many of our current political leaders, including President Biden, have expressed an interest in the latest pro-union bill, the Protecting the Right to Organize Act, which has already passed the House and is currently stuck in limbo in a filibuster in the Senate.
Is the PRO Act Likely to Pass?
The Act passed the House with a 225-206 vote, garnering just a few Republican supporters. However, the Senate is a tougher climate due to the slimmer Democratic majority lead. Senate Majority Leader Chuck Schumer stated his support of the PRO Act, but even its most vocal supporters maintain their stance supporting the current filibuster process, which requires a two-thirds vote to end ongoing debates. If the bill does pass, Biden claims he will sign it into law, which would significantly affect the construction industry.
How Will the PRO Act Affect the Construction Industry?
While the bill hangs in the Senate, the debate continues over its implications for the construction industry. Over the past year, the industry has been hit particularly hard by COVID-19 and the ongoing shutdowns and their crews are eager to return to “normal.” The PRO Act would undoubtedly change normalcy for contractors and their teams moving forward.
The largest change revolves around the legality of contractor vs. employee classifications. Currently, many construction workers are classified as contractors, which brings several benefits to the table. Supporters of the PRO Act would, of course, argue that there are also negatives for contractors, particularly when it comes to taxes. But the majority of independent contractors enjoy the flexibility and autonomy the classification provides. The PRO Act would implement the “ABC Test,” which was also recently executed in California, causing a wave of changes for contractors in that state. With this test, many independent contractors would be reclassified as employees. The American Action Forum found that if 15-50% of independent contractors are reclassified as employees the economic consequences could total between $3.6 billion and $12.1 billion in additional costs.
The law would also ban Right-to-Work protections throughout the country, which protect workers who wish to avoid joining a union and paying dues as a condition of employment. The PRO Act would institute a “card check” union organization method, which many believe strips workers’ free choice in union elections, limiting their privacy and freedom to choose to unionize or not.
Many other aspects of the PRO Act would further alter the way businesses interact with unions and employees. Many employer rights and protections would be eliminated, which explains the ongoing, industry wide concern. Perhaps the most concerning is the joint-employer standard, which holds contractors responsible for unlawful actions on a jobsite, even when those actions are committed by subcontractors.
Follow Updates to Remain Prepared
While the debate over the PRO Act continues both in the Senate and in public discussion throughout the U.S., one fact remains clear: If the bill passes, it will institute many sweeping changes for those working in the construction industry. A fearful possibility of this bill is that it could set the industry back in terms of returning to pre-COVID unemployment rates, job stability, and overall economic recovery. As an industry leader, it’s vital to stay informed with the latest updates on the PRO Act so you and your company can be prepared for any changes.
