October 18, 2002

MEMORANDUM FOR PRESIDENT’S MANAGEMENT COUNCIL

This memorandum is directed to all Executive branch agencies that administer Federal grants and contracts that are subject to the requirements set forth in Executive Order 13202, “Preservation of Open Competition and Government Neutrality Towards Government Contractors’ Labor Relations on Federal and Federally Funded Construction Projects” (Feb. 17, 2001), as amended by Executive Order 13208 (Apr. 6, 2001). The Executive Order establishes the Federal Government’s policy with regard to the use of Project Labor Agreements (PLA) in Federal and Federally-funded construction projects. A PLA is a multi-employer, multi-union pre-hire agreement that governs labor relations at a construction site.

As you may know, these orders have been the subject of litigation in the Federal courts. Earlier this year, based upon guidance received from White House Counsel and from the Department of Justice, OMB advised agencies that administer Federal grants and contracts subject to Executive Order 13202, as amended, that they should immediately cease implementation of the Executive Order’s requirements pending judicial resolution of that litigation.

On July 12^th, the U.S. Court of Appeals for the D.C. Circuit upheld Executive Order 13202 in its decision in Building and Construction Trades Dep’t, AFL-CIO v. Allbaugh. The Justice Department and the White House Counsel’s office have advised us that the D.C. Circuit has now issued its mandate in the case, and there is no legal impediment to full implementation of the Order’s requirements as contemplated by the D.C. Circuit’s opinion.

Accordingly, agencies should resume their implementation of Executive Order 13202 and should take all necessary steps to ensure its full implementation.

Please contact Angela Styles, Administrator, Office of Federal Procurement Policy at (202) 395-5802, with any questions about Federal contracts. Contact Joseph Kull, Deputy Controller, Office of Federal Financial Management at (202) 395-3993, with questions about Federal grants.