202 A.3d 205
Pa. Commw. Ct.2019Background
- PennDOT issued a December 20, 2017 solicitation for Phase 2 of the Markley Street (SR‑202) project that required the successful bidder to execute a project labor agreement (PLA) with the Building and Construction Council representing 11 local unions.
- The PLA required hiring craft labor through those Local Unions and incorporation of their collective bargaining agreements; it exempted contractors already under a United Steelworkers (USW) CBA from the Local Union hiring requirements.
- Allan Myers, a nonunion, prequalified contractor, filed a bid protest arguing the PLA discriminated against nonunion bidders, favored USW‑affiliated contractors, and violated statutory bidder‑qualification rules and competitive bidding principles.
- PennDOT defended the PLA as a permissible specification under its authority to set contract terms and relied on a consultant (Keystone) report and precedent approving PLAs where time or labor stability concerns justified them.
- The Secretary of Transportation dismissed Allan Myers’ protest, relying on precedent (Pickett, Sossong, Hawbaker) that PLAs can be lawful and noting the solicitation said any qualified contractor may bid.
- The Commonwealth Court reversed, concluding the PLA (1) favored USW contractors by allowing them to use existing workforces while others must hire through Local Unions, (2) introduced bidding uncertainty for nonunion contractors, and (3) lacked extraordinary circumstances (e.g., critical deadline or demonstrated labor shortage) that prior decisions found necessary to justify a PLA.
Issues
| Issue | Plaintiff's Argument (Allan Myers) | Defendant's Argument (PennDOT) | Held |
|---|---|---|---|
| Whether the PLA violates competitive bidding by disadvantaging nonunion bidders | PLA effectively precludes nonunion contractors from bidding and disfavors them vs. USW contractors | PLA is a permissible contract specification; any qualified contractor may bid; PLA promotes timely performance | Court: PLA violates competitive bidding because it favors USW contractors and does not place bidders on equal footing |
| Whether PennDOT abused discretion by relying on the Keystone report to justify the PLA | Keystone report is biased, non‑objective and insufficient to justify PLA | PennDOT reasonably relied on consultant analysis to justify addressing labor issues | Court: Keystone report did not show extraordinary circumstances (no deadline or labor shortage); PennDOT did not justify PLA |
| Whether PLA conflicts with State Highway Law bidder‑qualification scheme | PLA adds criteria (union affiliation/ability to conform to PLA hiring rules) not in statutory bidder qualifications | PennDOT has discretion under State Highway Law to set contract specifications, including labor management terms | Court: Even with statutory discretion, agency may not act contrary to competitive bidding requirements; PLA impermissibly discriminates |
| Whether precedent (Pickett/Sossong/Hawbaker) controls here | Those cases allow PLAs when necessary to ensure timely completion; PLA is therefore permissible | Prior cases support PennDOT’s discretion to use PLA to address scheduling/labor risks | Court: Prior cases are factually distinguishable; those PLAs were justified by extraordinary circumstances absent here |
Key Cases Cited
- A. Pickett Constr., Inc. v. Luzerne County Convention Ctr. Auth., 738 A.2d 20 (Pa. Cmwlth. 1999) (upholding PLA where urgent project deadline justified labor stability measures)
- Sossong v. Shaler Area Sch. Dist., 945 A.2d 788 (Pa. Cmwlth. 2008) (affirming discretion to use PLA where time‑sensitive performance and no‑strike protections were needed)
- Ezy Parks v. Larson, 454 A.2d 928 (Pa. 1982) (competitive bidding integrity requires common standards and equal footing for bidders)
- Hallowell v. Philadelphia Warehousing & Cold Storage, 490 A.2d 955 (Pa. Cmwlth. 1985) (public bidding requires equal opportunity and uniform standards)
- Conduit & Foundation Corp. v. City of Philadelphia, 401 A.2d 376 (Pa. Cmwlth. 1979) (courts will intervene where procedures create potential for favoritism regardless of good faith)