The Des Moines Construction Council sees a growing need for signatory contractors, regardless of their trade, to have an outlet to share information and learn more about the challenges of managing not only collective bargaining agreements, but also the many aspects that union contractors face. Though the trades are different, there is a commonality amongst signatory contractors that DMCC hopes to serve.
Des Moines Construction Council Meeting
for December Cancelled
Please be advised that the DMCC Quarterly Business Meeting that was scheduled for December 10th at the Holiday Inn has been cancelled due to Gov. Reynold’s most recent emergency health proclamation signed on Nov. 18th.  

We have however, scheduled a DMCC Membership Meeting via ZOOM for Tuesday, December 15th at 11:00AM. Pursuant to the By Laws, this annual membership meeting will be for the purpose of reporting association business, financials as well as electing representatives to the Board of Directors. An Outlook invite will be forwarded soon.

We look forward to seeing everyone on December 15th.
Construction Labor Research Council (CLRC)
Releases Addendum on COVID's Impact on
Union Craft Pay Data
Due to the ongoing effects of the pertinent pandemic, CLRC has conducted additional analyses focused on identifying the impacts of COVID-19 on union craft pay data.

Exhibits 1a and 1b compare the distributions of first year settlements in 2019 (2019-Yr 1) and COVID-19 impacted first year settlements in 2020 (April 1 – September 30).

As shown by Exhibit 1a, as a proportion, many more settlements reached after April 1 in 2020 (2020-COVID) were in the ranges of $0.75 and lower compared to 2019-Yr 1. There were also far fewer settlements in the $2.01 - $2.25 range in 2020-COVID. For most other ranges the two distributions were comparable, with the exception of $0.76 - $1.00. It is possible that the settlements that would have fallen within that range may have been shifted to the lower ranges in 2020-COVID.
Exhibit 1b shows how, as percentages, settlements have shifted due to COVID-19. The most notable change was at the top-end of the distribution. Less than five percent of 2020-COVID settlements surpassed four percent, while in 2019-Yr 1 nearly 20 percent met that threshold. There was also a higher percentage of 2020-COVID settlements in some of the lower ranges (1% or less and 1.6% - 2.0%).
Exhibits 2a and 2b examine the average first year increase of a subset of the 2020-COVID settlements (Subset). That is, the portion of settlements that were negotiated in both 2020-COVID and 2017 (i.e., three year contracts). Subset is represented by the lighter-colored bars. The darker- colored bars represent the average for all increases for the same two time periods.

Exhibits 2a and 2b tell the same story. Subset’s first year average increase in 2017 landed above the all-increase average, both in terms of dollars and percentages. When these same contracts contained in the Subset were negotiated in 2020, their average increase was not only lower than in 2017, but also lower than the all-increase average, which was not the case in 2017. These findings indicate that COVID-19 is driving the size of increases down for numerous settlements.
Exhibit 3 shows the distribution of the length of contracts settled in 2018, 2019, and COVID-19 impacted 2020.
Interestingly, while there was a substantial increase in one-year contracts during the COVID-19 pandemic, there was also an increase in four-year contracts and a decrease in three-year contracts.
What's in Store for Contractors under a Biden Presidency?

From infrastructure spending and union support to immigration, taxes and regulations, the construction industry will face a new set of challenges and opportunities under a Biden administration.

After a contentious election week that includes the potential for continued lawsuit and recounts, major news outlets have declared that former Vice President Joe Biden will be the next president of the United States.
Looking forward to Inauguration Day and beyond, what does that mean for the U.S. construction industry? 

In terms of infrastructure spending, contractors can look to what Biden outlined during his campaign. The presumptive president-elect said his administration will invest $2 trillion into the economy, creating millions of jobs in infrastructure, housing, building construction and other projects.

"He's looking for a multitrillion-dollar infrastructure bill that includes a broad definition of infrastructure, whether it's surface transportation, aviation, waterfront, Army Corps, civil works, flood control mitigation projects, clean drinking water, renewable energy projects, K-12 public school construction or broadband," said Jimmy Christianson, vice president of government relations at the Associated General Contractors of America. "There's a lot in there."

Another clue as to what the Biden administration could include can also likely be found in recent infrastructure proposals from Democrats, which currently enjoy a House majority. In July, the House passed the $1.5 trillion Moving Forward Act, which includes billions for highways, bridges, schools and energy projects.

One thing that certainly won't be included under Biden's watch is continued funding for Trump's border wall, which could leave the contractors currently working on it in a lurch if the funding plug is pulled. This summer, Biden said that his administration would not build “another foot of wall” along the U.S.-Mexico border if he was elected. 

'The Biden challenge'
Observers also point out that while contractors would certainly benefit from that infusion of funding for civil projects, they would be held to account for what it's spent on and how they operate their own businesses. For instance, Biden has made a carbon tax and buying American part of his campaign platform and would likely emphasize inclusion programs for minorities. 

"The Biden challenge for us is that you're going to get more money, but then you're going to have to measure your greenhouse gas emissions," said Jay Hansen, executive vice president for advocacy at the National Asphalt Pavement Association, whose members include road builders. "Everyone will be challenged to buy American in terms of material. Disadvantage Business Enterprise [DBE] project labor agreements and those kind of programs will get tougher."
From that perspective, Christianson said that while any funding would be good, Biden won't be writing a blank check for contractors. 

"The possibility of a large infusion of capital in the coming months would be welcomed," said Christianson. "But again, the strings that are attached to that capital are going to be our biggest concerns.”

Unions, immigration on the table
One of the biggest issues to watch for contractors will be Biden's stated intention to "strengthen worker organizing, collective bargaining and unions."
The Democrats’ ability to move forward with pro-union legislation like the PRO (Protect the Right to Organize) Act will depend on whether the Senate retains its Republican majority. Senate Republicans thus far have failed to advance that legislation since the House passed it early this year. 

Mike Bellaman, president and CEO of the Associated Builders and Contractors, argues that the PRO Act could potentially take away workers' choice to join a union or not. 

"The first thing it does, which I don't think many people really understand, is it overrides 27 states that have been through a democratic process to decide that they want to be a right to work state," Bellaman said, referring to states that have banned compulsory union membership for workers. In those states, workers can still choose to join a union, but can't be forced to.

"It does a significant amount to the process of employee choice to determine do they want to work in an organized environment or not, or a non-union, non-organized environment."

On the other hand, a Biden administration would likely make it easier for workers who aren't U.S. citizens to be legally employed in the United States, which should help construction's perennial labor shortage. 

"There are over 100,000 workers in the construction industry that are either in the DACA [Deferred Action for Childhood Arrivals] or TPS [Temporary Protected Status] program," Christianson said. "Under President Trump, we would expect for those programs to be dismantled. Under President Biden, that wouldn't be the case, and those programs would probably be enacted into statute or some sort of immigration package."

While construction and infrastructure aren't typically why people turn out at the polls, the results will impact contractors. 

“The election is consequential," Hansen said. "With Biden, you might get a better, bigger program. But you know, who gets to spend the money and what the money can be spent on is really important.”
Will Biden Continue Trump's
Construction-Friendly Regulator Environment?
The construction industry is wondering how the Biden administration will approach business regulations and the rollbacks that President Trump has put in place.

Inauguration Day is right around the corner, and with the swearing-in of President-elect Joe Biden, there are some things he has already said will change.

Biden has been quite vocal about reversing some of President Donald Trump's policies and programs like the construction of a border wall between the U.S. and Mexico and the U.S. withdrawal from the Paris climate accord and the World Health Organization.

The big question for the construction industry, however, is whether a Biden administration will go after the business-friendly regulations that Trump and his appointees spent the last four years putting in place. In other cases, Biden's team could bring back regulations that Trump worked to discard.

For instance, Trump issued an executive order this summer directing federal government agencies to waive environmental regulations and to take other actions necessary to streamline and expedite infrastructure projects. The order, designed to help hasten the economic recovery from the COVID-19 pandemic, effectively got rid of the responsibility for federal agencies to abide by regulations established by the National Environmental Policy Act, the Endangered Species Act and the Clean Water Act. 

So how will the regulatory environment change under the Democrat's administration?

The first thing that is likely to happen, said Jimmy Christianson, vice president of government relations at the Associated General Contractors of America, is that upon Biden’s inauguration, or shortly thereafter, the new administration will initiate a federal regulatory freeze.
“Anything in proposed rulemaking,” he said, “any proposals, any guidance initiatives being put forth come to a halt.”
This gives time, Christianson said, for the new administration to set its regulatory priorities.

A halt on rulemaking initiatives would likely include a Department of Labor rule that revises the guidelines for determining if a worker falls into the category of employee or independent contractor. The DOL regulation gives employers more leeway than other stricter ones, said Ben Brubeck, the Associated Builders and Contractors’ vice president of regulatory, labor and state affairs.

Also, probably high on the list, Brubeck said, is the National Labor Relations Board’s joint-employer rule, which redefined joint-employer status under the National Labor Relations Standards Act. The new regulation, which won praise from employer organizations including the ABC, not only sets out requirements for employer communication with unions and responsibility for unfair labor practices but limits joint-employer status to companies that share control of activities like wages and hiring.

Other construction-related rules that could change under the new administration include:

Overtime rule
Under former President Barack Obama, the DOL proposed raising the minimum salary threshold to $47,476 from $23,600. This meant that employers would have to pay workers the new, higher salary in order to classify them as exempt from overtime wages. Business groups, including those representing contractors, argued that the new limit would create a burden for employers and didn’t take into consideration that compensation differs around the country.
However, that threshold was lowered to $35,568 during the Trump administration, and, Brubeck said, Biden’s DOL might try to revisit the limits once again.

Persuader Rule 
After a Texas court blocked its implementation, Trump’s Department of Labor rescinded the Persuader Rule, which required employers to disclose attorney-client communications pertaining to labor union organization efforts. The Biden administration, which promises to view these sorts of issues with a pro-union stance, could try to reinstate this rule.

Fair Pay and Safe Workplaces Act
The DOL act, also known as the blacklisting rule, would have required contractors bidding on federal construction projects over $500,000 to submit their history of labor compliance for review to the DOL before a potential award.
Using the Congressional Review Act, Congress repealed the rule only a few months after Trump’s inauguration. The CRA, Brubeck said, prevents a significantly similar rule from coming forward but said the Biden administration could try to pass a “watered-down version.”

Other executive orders
While Biden has promised to create “good union jobs," Christianson said that the new president will have to balance his desire to reinstate or pass new restrictive regulations with keeping his union constituents happy with plenty of construction jobs.

“Doing things to ‘gum up’ certainty and efficiency in federal environmental reviews for construction projects isn't helpful for any construction labor union and their members that need work, just as our contractor members need work,” he said.

The biggest impact, however, could come through executive orders and personnel decisions.

“I think the main changes will just be who's in charge of enforcement, who is in charge of the agencies and what's their posture on different things that don't have to go through a rulemaking and a notice and comment period,” Brubeck said.

Infrastructure legislation
And while some in the construction industry are keenly interested to learn which of Trump’s regulations and rollbacks Biden might change, Nick Goldstein, vice president of regulatory and legal issues at the American Road & Transportation Builders Association, is focused on a more proactive approach.

“We'd like to get movement on a reauthorization bill for surface transportation, and it certainly seems like [a Biden] administration wants to do that," he said. “They see infrastructure as a way to help in our recovery as well as he's always been somebody that's talked about infrastructure.

“If there's not going to be movement on infrastructure,” Goldstein said, “then the regulatory issues don't matter as much. We need to have projects to build before we can start arguing about how they should be built.”