Cloquet eliminates project labor agreements

The Cloquet City Council has voted to repeal an ordinance requiring contractors to work under project labor agreements, effectively eliminating the use of PLAs in the city.

PLAs, which were used in city projects since 2017, required contractors to abide by certain terms such as timelines, working conditions and budgets.

The proposal to abolish the agreements first came after litigation was brought against the city in January based on the enforcement of PLAs, which have previously been accused of being discriminatory toward independent contractors.

Although the council has since removed the portion of the city’s PLA that prohibited non-union workers from bidding on city projects, city staff still believed that further action was necessary to avoid future legal issues.

PREVIOUSLY: Cloquet City Council to consider eliminating project labor agreements Due to pending litigation, officials may decide to eliminate project labor agreements from the city of Cloquet.
“Lawsuits against the city directly impact the city’s taxpayers as the costs for defense and potential damages are passed on to them through property tax levies,” read the staff request for council action. “Staff believes it is in the best interest of those taxpayers and the city as a whole to resolve, at least in part, the current and potential future lawsuits in this way.”

The 4-3 vote to eliminate PLAs came after extensive public comment and discussion at the council meeting Tuesday, May 4, with nearly 20 people voicing an opinion on the matter.

Most who spoke were union representatives and members claiming that PLAs are necessary to ensure project efficiency, local job opportunities and fair working conditions.

Those speaking against PLAs called them "discriminatory" and a form of wage theft against non-union workers, many of whom they say live in the area.

According to the U.S. Bureau of Labor Statistics , union workers accounted for 15.8% of wage and salary workers in Minnesota in 2020, meaning many workers in the state are not union members.

“PLAs essentially tell these Minnesotans, and even those who live in Cloquet, that they’re not welcome to work on your projects," said Adam Hanson with the Associated Builders and Contractors of Minnesota. “PLAs discriminate against merit shop contractors, disadvantaged businesses, minority-owned business … they also disenfranchise local workers.”

Those in favor of the PLAs contradicted this point, stating that corporations that wish to rid Cloquet of the agreements also wish to rid workers of a livable wage.

“At the end of the day … these are large corporate dark-money pools that attack these things for their special interest," said Keith Musolf, a representative of Iron Workers Union Local 512.

Musolf and others claimed that PLAs allow workers living in the area first access to city projects, ensuring that taxpayer money stays entirely local.

“These are folks that keep the lights on and doors open in downtown Cloquet," Musolf said.

Skilled union worker Rachel Goodsky said she feared she would not be able to find work locally if PLAs were revoked, explaining that her children and enrollment in school stops her from traveling for work.

Some suggested the council make amendments to the PLAs instead of repealing them completely, an idea that was supported by Ward 3 Councilor Chris Swanson.

City Administrator Tim Peterson said the issue is not a matter of "union versus non-union" and the change will allow all contractors to fairly bid on city projects.

This story was updated at 2:15 p.m. May 5 to correct a misquote from Adam Hanson. It was originally posted at 10:33 a.m. May 5. The Pine Journal regrets the error.