Category: Advocacy

MCAA and the UA filed joint comments on a recent Department of Defense (DoD) procurement policy change proposal. Under the proposal, DoD contracting officers would be required to rate the performance of first-tier subcontractors on DoD construction contracts. MCAA and the UA support the proposed rules, which will lead to more discerning past performance evaluations of first-tier subcontractors competing for subsequent prime contract awards. MCAA and the UA also call for DoD and Federal Acquisition Regulation (FAR)-wide use of past performance evaluations of first tier subs in all prime contractor responsibility determinations.

Principal Deputy Administrator for the U.S. Department of Labor’s Wage and Hour Division Jessica Looman has joined the lineup of speakers for the Construction Employers of America (CEA) legislative and regulatory conference on Wednesday, July 21st from 11:00 am – 3:00 pm EDT. The virtual event will focus on key regulatory and legislative issues affecting the union construction industry today. As with previous in-person conferences, the CEA will host both Regulators and Representatives from Congress for their expertise and insight on a variety of topics such as: 

• The regulatory landscape for Multiemployer Pension Plans based upon enactment of the American Rescue Plan Act (ARPA) of 2021.
• Department of Labor efforts to address Employee Misclassification.
• OSHA developments of interest to the construction industry.
• Infrastructure spending in the Energy and Building Market Sectors and proposed tax measures to fund it.

Who is the CEA?

We are a coalition of seven premier national construction specialty contracting associations, working together to raise awareness among policymakers, opinion leaders, and the general public, about the value of high-quality American construction. CEA engages on national, state, and local public policy initiatives to strengthen the domestic construction industry and provide opportunities for top-quality construction workers to earn the skills they need to command high wages.

The Construction Employers of America (CEA), of which MCAA is a charter member, will be hosting this year’s legislative and regulatory conference virtually on Wednesday, July 21st from 11:00 am – 3:00 pm EDT, and it will focus on key regulatory and legislative issues affecting the union construction industry today. As with previous in-person conferences, the CEA will host both Regulators and Representatives from Congress for their expertise and insight on a variety of topics such as: 

• The regulatory landscape for Multiemployer Pension Plans based upon enactment of the American Rescue Plan Act (ARPA) of 2021.
• Department of Labor efforts to address Employee Misclassification.
• OSHA developments of interest to the construction industry.
• Infrastructure spending in the Energy and Building Market Sectors and proposed tax measures to fund it.

Who is the CEA?

We are a coalition of seven premier national construction specialty contracting associations, working together to raise awareness among policymakers, opinion leaders, and the general public, about the value of high-quality American construction. CEA engages on national, state, and local public policy initiatives to strengthen the domestic construction industry and provide opportunities for top-quality construction workers to earn the skills they need to command high wages.

What do the multiemployer pension reforms in the Butch Lewis Emergency Pension Plan Relief Act of 2021 (signed into law by President Biden in the American Rescue Plan Act of 2021 on March 11, 2021) mean for your company? MCAA’s John McNerney is joined by leading industry experts Earl Pomeroy of Alston & Bird and Josh Shapiro of The Groom Law Group to lay out the details of the law, the questions remaining to be answered in regulations issued by the Pension Benefit Guaranty Corporation in the 1,200 days from enactment, and what it will mean for your plans and the industry overall. Mr. Shapiro and Mr. Pomeroy will also speak about remaining reform items to be addressed in upcoming enactment of Composite Plans and perhaps also new and improved Variable Benefit plan options for trustees to consider.

About the Presenters

Former Congressman Earl Pomeroy, who served in Congress for 18 years, and as a member of the prestigious House Ways and Means Committee, was the lead sponsor of the Pomeroy-Tiberi pension reform proposal as early as 2010. He is currently consulting with MCAA on pension reform issues.

Josh Shapiro is a leading actuarial expert on multiemployer pension issues in Washington, D.C., having served as the research and policy director at the National Coordinating Committee for Multiemployer Plans, and for the past eight years as a pension/actuarial advisor at The Groom Law Group in Washington, D.C. For many years, Mr. Shapiro and Groom Law Group have served as advisors to MCAA on pension and other employee benefits policy issues.

John McNerney is MCAA’s General Counsel. He also serves as executive director of government and labor relations at MCAA, collaborating with other specialty construction employer groups and the United Association to advance legislative and policy positions in MCAA members’ best interests.

MCAA is among supporters of legislation reintroduced earlier this week that would increase the financial security of federal infrastructure projects. A recent article in Transportation Today highlights the legislation reintroduced by U.S. Sens. Chris Van Hollen (D-MD) and Mike Rounds (R-SD), along with U.S. Sens. Stephen F. Lynch (D-MA) and Troy Balderson (R-OH), Promoting Infrastructure by Protecting Our Subcontractors and Taxpayers Act of 2021.

Horizon Actuarial Services, LLC, and the Groom Law Group will be co-sponsoring a complimentary webinar on the American Rescue Plan Act of 2021 provisions for multiemployer pension plans. The webinar, which will address how recent law changes will impact multiemployer pension plans in general, will take place Tuesday, March 23 at 12:00PM EDT. A summary of the changes can also be found on Horizon’s website.

Tuesday, March 23, 2021 | 12:00 p.m. EDT

On March 11, 2021, President Biden signed a significant COVID-19 relief package – the American Rescue Plan Act of 2021 – into law. Included in this legislation are several provisions that provide temporary funding relief to multiemployer pension plans, as well as a significant amount of special financial assistance that is available to seriously underfunded plans. The temporary funding relief provisions are broadly available to multiemployer plans, and they allow additional time for plan sponsors to address the investment and other losses incurred in recent years. Significantly underfunded plans can demonstrate eligibility for the special financial assistance based on their funded position in 2020, 2021, or 2022. Initial applications for assistance are due by the end of 2025. Financial assistance will be paid to eligible plans as lump sums that do not need to be repaid, and is intended to keep plans solvent through 2051.

The panelists on this webinar will discuss the development and passage of the legislation, the key funding relief and financial assistance provisions, and the various aspects of the legislation that are not fully clear and may be open to multiple interpretations.

REGISTER TODAY

Important Note: You will receive an email from the Groom Law Group on the morning of March 23rd with the link to access the webinar.

Speakers

• David Pazamickas – Horizon Actuarial
• Mariah Becker – NCCMP
• Michael Kreps – Groom Law Group
• Jason Russell – Segal Consulting
• Brigen Winters – Groom Law Group

If you have questions on how the law may impact your specific plan, please contact your Horizon Actuarial consultant.

MCAA’s initiative with the MCA of Maryland, the MCA of Metropolitan Washington, the MCA of New York, and the New England Mechanical Contractors Association (NEMCA) is moving ahead with contacts in the House and Senate expanding to seek an add-on proposal in either the next COVID relief measure or possibly on the infrastructure proposal that is expected soon. The proposal is relatively simple – Congress should set up a separate COVID Cost Recovery Fund on direct Federal construction contracts to pay impaired productivity and other COVID direct costs to be administered apart from the affected projects’ budgets. The rationale is that it is inequitable for the government as proprietor of the project to take the full benefit of the fixed-price award pre-COVID and then drive a hard bargain denying full equitable cost impact recovery post pandemic, while at the same time using taxpayer resources to bail out other industries outside of any contractual relationship.

MCAA was able to gain the active support of the New York Tri-State Chapter of the National Association of Minority Contractors backing our initiative with New York City Congresswoman Carolyn Maloney, who is chair of the lead committee of jurisdiction on this issue in the House Oversight and Reform Committee (OGR). NEMCA recently was instrumental in gaining the active consideration of Boston area Congressman Stephen Lynch, a high ranking member on both OGR and the Transportation and Infrastructure Committee, which shares jurisdiction on these issues. 

The Democrats in the 117^th Congress are pressing the Butch Lewis Emergency Pension Plan Relief Act of 2021 in two phases. The first phase, the American Rescue Plan of 2021, is moving through the reconciliation process in the House and Senate (not subject to filibuster in the Senate). It would provide funding to enable the Pension Benefit Guaranty Corporation (PBGC) to pay full benefits for plans in critical status (with a funded ratio below 40% and an active to inactive participant ratio of less than 2:3). Funding would also be provided to help critical and declining plans, and those plans that have already cut benefits (or have applications pending) under the 2014 Multiemployer Pension Reform Act (MPRA) benefit suspension procedure. 

Plans would  have until December 31, 2025 to apply for assistance. Estimates are that the amounts required to fund the program will come to some $85 billion and could extend to as many as nearly 280 plans by the expiration of the eligibility period. The payments from PBGC to eligible plans are to pay benefits for 30 years. The payments are grants – they are not loans and are not repayable. As of the end of Plan Year 2020, it is estimated that some 15 United Association (UA) plans would be eligible for PBGC payments. 

As of this writing, the Senate Parliamentarian reconciliation judgments relating to the pension proposal have not been settled, and the House passage is still pending.  All the other non-budgetary policy aspects of multiemployer pension reform – including the adoption of Composite Plans for trustees to consider – remain subject to regular order legislative procedures later in this year.  

MCAA’s Government Affairs Committee has been busy protecting our members’ interests on Capitol Hill. Progress is being made on issues such as multiemployer pension plan reform and equitable compensation for COVID cost impacts. MCAA is also working to prevent the misclassification of employees, protect Federal construction contracts against Internet reverse auctions, and support legislation that would expand apprenticeship and pre-apprenticeship.

Multiemployer Pension Plan Reforms

The much-delayed multiemployer pension reform proposal is moving forward in fits and starts.

Because it now appears the next COVID recovery measure will progress under Reconciliation procedures, only the fiscal aspects of the proposed multiemployer reforms will move forward under Reconciliation. These reforms affect the 220 or so critical and declining plans – with a massive Federal appropriation for the Pension Benefit Guaranty Corporation (PBGC) to secure and fund full benefits for participants in the most severely distressed plans for the next 30 years.

The other aspects of the long-proposed reforms – reform of funding rules, and, for MCAA most critically, new plan designs such as Composite Plans, cannot proceed under Reconciliation, so now must wait for House and Senate leadership to deliver on their promise of new plan design options on a regular order measure later in this session of Congress.

Direct Federal Construction Contract COVID Cost Recovery

The MCAA initiative to provide for full equitable compensation for COVID cost impacts on direct Federal construction projects awarded pre-COVID and performed after the COVID emergency work protocols were put in place continues to make measured progress. MCAA, in conjunction with the New York City Tri-State Chapter of the National Association of Minority Contractors (NAMC), are pressing House and Senate lawmakers to adopt Federal force majeure public contract administration policy changes. These changes would allow full COVID cost impact recovery in addition to contract time extensions. A similar proposal had been included in earlier version of the HEROES Act proposal from Congressional committees last year. The MCAA and NAMC proposal is a specific adaptation of that more general recommendation that stalled in the last Congress HEROES Act negotiations.

Protecting the Right to Organize Act

MCAA’s Government Affairs Committee is analyzing the latest union organizing measure, the Protecting the Right to Organize Act (PRO Act), to see where its provisions might extend out from impacts on open-shop employers to directly affect the interests of union-signatory employers.

While the proposal gained passage in the House in the last Congress, it is expected that its progress this year in both the House and Senate may take a back seat to the more pressing and bipartisan effort to spur economic recovery with a badly needed infrastructure investment measure.

Regulatory Developments

As with any change in Administration, the pace of regulatory reversals on items of interest to MCAA members is broad, starting initially with the standard regulatory freeze.

MCAA expects the late Trump Labor Department initiative redefining the classification criteria for categorizing workers as “employee” under the Fair Labor Standards Act will undergo reversal.

MCAA filed comments on that proposal late last year asking the U.S. Department of Labor (DOL) to participate with the Internal Revenue Service in an industry-by-industry, government-wide set of guidelines for proper classification of workers as either employees or independent contractors and seek whatever Congressional action is necessary to rationalize the patchwork of various Federal rules defining worker classification.

It should be noted that the aforementioned PRO Act would adopt the ABC control test for defining “employees” under the National Labor Relations Act. This supports MCAA’s position in a joint brief with the United Association (UA) to the National Labor Relations Board (NLRB) last year. The brief urged that worker misclassification itself, judged by whatever standard, should be considered an unfair labor practice of denial of that misclassified worker’s rights to engage in protected concerted activity as an employee independent of any other unfair labor practice  charge.

Direct Federal Construction Contract Selection Procedures – Ban On Reverse Auctions, Proposed FAR Case On Subcontractor Bid Listing

Also in December, the Trump Administration’s General Services Administration proposed a long-pending ban on reverse auctions for direct Federal construction contract procurement. The proposal on its face may have been limited to only some competitive negotiation or low bid or other price-only selection procedures.

MCAA’s comments, filed with the Government Accountability Office (GAO) in December, called for a re-proposal enacting the clear 2020 omnibus spending provision direction that Internet reverse auctions cannot be used on any or all direct Federal design and construction contract selection procedures.

The MCAA comments also requested a Federal Acquisition Regulation (FAR) case examining the re-adoption of subcontract bid listing on all direct Federal bid or proposal submissions for price-only selection procedures. MCAA’s comments can be downloaded here.

President Biden Unwraps IRAPs

President Biden rescinded Executive Order (EO) 13801, the Trump Administration EO that led to the development and promulgation  of Industry Recognized Apprenticeship Programs (IRAPs). This action came ahead of a meeting between President Biden, Vice President Harris, and leaders of the North American Building Trades Union (NABTU) on Wednesday, February 17, 2021 to discuss the Administration’s infrastructure initiative.

MCAA, along with virtually all industry groups, filed comments on the IRAP proposal in July 2019 calling for an exemption of IRAP adoption in the construction industry, which was granted, but remained subject to change.  Today’s Biden Order rescinds, EO 13801, directs the Labor Department to stop approval of Standards Recognition Entities (SREs, the sponsors of IRAPs) and defunds existing SREs. The Biden Directive also expresses support for the proposed new National Apprenticeship Act to expand apprenticeship and pre-apprenticeship and other reforms.  MCAA, along with the Construction Employers of America (CEA), supports the legislative proposal. The Biden directive also reinstates the National Advisory Committee on Apprenticeship at the Labor Department.  It is widely expected that promotion of registered apprenticeship will continue to be an integral part of the Administration’s infrastructure initiative.

Questions about any of this information should be directed to John McNerney.