Category: Advocacy

All ARCA/MCA Board Members Contribute to MCAA’s PAC for Eighth Consecutive Year

A high profile PAC operation, closely targeted to concrete results, is an essential part of any effective advocacy program. In recent years, MCAA member company principals have also become directly involved in high profile PAC-supported events and ongoing Washington meetings with administrative agencies concerning a broad range of regulatory policy challenges proposed by the Obama Administration.

MCAA PAC’s mission is simple but vital — to achieve a fair hearing on federal policy issues affecting MCAA members and our industry. Our strategy is to continue combining sound and vigorous public policy representation and advocacy with the increasing use of appropriate political activity.

Through the efforts of MCAA’s Government Affairs Committee, the progress of key issues is tracked along with the actions of elected legislators and candidates who have a record of supporting issues of vital interest to MCAA members and the industry.  The Committee, as part of its oversight responsibility for the MCAA PAC, judges which legislators and candidates to support based on local affiliate recommendations. The MCAA PAC is bipartisan.

If you would like to make a contribution to the MCAA PAC or learn more about how it works, go to MCAA PAC.

 

 

UA EVP Rick Terven Testifies at House Hearing on Composite Pension Plans

United Association Executive Vice President Rick Terven testified before the House Education and Workforce Committee on September 22nd on Chairman John Kline’s proposals to modernize multiemployer pensions.

In his testimony, Terven stressed that “If composite plans are not made available, we believe that many existing defined benefit plans will eventually be replaced with defined contribution plans. The opportunity for creative solutions to our retirement income challenges is within our grasp. We strongly encourage Congress to take advantage of it and expand available offerings to enable labor and management to find solutions which best meet their specific needs.”

Read Terven’s testimony.

The Committee press release answering questions on the Chairman’s proposal can be found here. The discussion draft, which was released two weeks ago, contains new multiemployer composite plan designs that were part of the Solutions Not Bailouts proposals held back when the Kline-Miller pension reform law was enacted in 2014. The composite plans were developed by the National Coordinating Committee for Multiemployer Plan’s Retirement Income Security Review Commission, which included MCAA and the United Association.

Chairman Kline has invited interested parties to provide input into the draft’s features. He has also requested comments and proposals on how to shore up funding for the Pension Benefit Guaranty Corporation (PBGC) multiemployer plan insurance fund, which is headed for insolvency within 10 years without major changes to its program and insurance premium funding.

In releasing the discussion draft Chairman Kline stated:

“For years, the committee has worked on a bipartisan basis to improve multiemployer pensions and safeguard the retirement security of workers and retirees. We have already made significant progress, and the draft proposal released today represents the next step in this important effort.

This proposal will provide more retirement choices for workers, more flexibility for employers, and greater protection for taxpayers. It reflects the input of business and labor leaders, as well as retiree advocates who have long recognized the need to strengthen the retirement security. I encourage other concerned individuals to share their views and ideas.

There is still a lot of work to be done, including tackling the fiscal challenges facing the PBGC. Improving the multiemployer pension system is an urgent priority for employers and labor leaders that will benefit America’s workers and taxpayers. I hope my colleagues in the House and Senate will make it an urgent priority as well.”

The composite plans are new plan design options that plan sponsors can choose to adopt or not in plan amendments. The discussion draft envisions adoption of a composite plan by amendment to a traditional multiemployer defined benefit plan that suspends future accruals into the former (legacy) plan (Red Zone plans cannot convert). All future accruals then flow into the new composite plan.

In the new composite plan, annual one-year and 15-year funding projections must maintain 120% funding. Shortfalls must be addressed by added contributions, future accrual cuts, and other benefit adjustments to meet the 120% funding safeguard. The legacy plan also must be funded under current funding rules, and there are minimum funding requirement contributions for all employers that enter the composite plan.  And, because the benefits in the composite plan are not insured by PBGC, no PBGC premiums are paid on those participants. Legacy plan participants still pay the PBGC premiums at whatever new higher level may be imposed.

The UA and MCAA also submitted a joint statement of support to lawmakers on Capitol Hill. Chairman Kline’s call for urgent Congressional action is fully warranted, as the composite plan models have been thoroughly vetted in Congress over the past several years.  Action this year will stem the need for consideration by the next Congress, which would take a year or more, and thereby diminish the remedial benefits of the composite plan model for the entire system.  MCAA, the UA and the NCCMP coalition continue to press lawmakers to honor Mr. Kline’s perseverance on this most important issue and to heed his call for timely and effective action this year, even though time is short.

UA and MCAA Discuss Affirmative Action Issues with DoL Compliance Officials

The UA’s Director of Training Chris Haslinger and MCAA General Counsel John McNerney gave a 90- minute presentation to the Department of Labor’s Office of Federal Contract Compliance Programs (OFCCP) on September 22, 2016. The presentation covered jointly administered training programs, collective bargaining agreement worker dispatch practices, hiring hall operations and MCAA member hiring procedures.

The program was the first ever training program related to OFCCP’s upcoming emphasis on Executive Order 11246, which deals witth compliance and enforcement of affirmative action outreach and non-discrimination requirements for women, minorities, veterans and individuals with disabilities foprime contractors and subcontractors on direct federal and federally assisted mega construction projects.

This MCAA and UA outreach grew out of the organizations’ collaboration and joint comments to DoL on new written affirmative action program requirements and a number of other DoL regulatory initiatives put forth by the outgoing Administration.

 

MCAA Supports Challenge to NASA FOIA Shield on Prevailing Wage Audit

MCAA Government Affairs Committee Chairman Bill Albanese and Committee member Jim Gaffney joined in support of the Foundation for Fair Contracting’s (FFC) challenge of an over-broad Freedom of Information Act (FOIA) shield by the National Aeronautics and Space Administration (NASA) to withhold certified payrolls in a prevailing wage audit on a NASA job in Greenbelt, MD.

FFC requested certified payroll information on two firms performing on the NASA job. NASA redacted the wage rate information on the certified payroll records, citing an FOIA exemption that permits agencies to refuse disclosure of information or documents that would reveal trade secrets and commercial or financial information considered privileged and confidential.

NASA’s rationale was that revealing actual wages paid to contractor employees on prevailing wage jobs could be used by competitors to predict future bids and estimates and, therefore, undercut that firm’s future competitive position.

MCAA members Albanese and Gaffney filed affidavits in conjunction with FFC’s administrative appeal explaining why the certified payroll information could not be used to predict future project labor estimates and bidding.

MCAA-Backed Small Business Subcontracting Protections Added to SBA and FAR Regulations

The latest regulatory notice affecting the Federal Acquisition Regulations (FAR) provides 11 changes to the small business subcontracting plan procedures required of prime contractors on covered prime contracts ($1.5 million or more), the most significant of which is the subcontractor listing and payment protections.

The prime contractor must make demonstrable good faith efforts to use the same small business subcontractors they relied on in preparing and presenting their bid, proposal and small business utilization plan to the contracting agency for approval.

If the prime contractor fails to utilize the relied-upon small business subcontractors, the prime must provide a written explanation to the contracting agency within 30 days of contract completion. Failure to use the named subs can be the basis for future adverse prime contract performance evaluations and responsibility determinations.

The regulations also prohibit prime contractors from attempting to bar small business subcontractors from discussing subcontract plan compliance or prime contract payment problems with the contracting agency directly.

The regulations also require that prime contractors notify the contracting officer in writing if they pay a small business subcontractor a reduced amount or if payment is held more than 90 days after the prime has been paid.

And, any record of payment violations is to be recorded in the prime contractors’ past performance evaluation in the Federal Awardee Past Performance information System (FAPPIS).

MCAA testified in support of these provisions on May 23, 2013 before the House Small Business Committee. Read the testimony here.

Access the new regulations.

Local Association Boards Support MCAA-PAC

The annual round of MCAA local affiliated association summer board meetings continues to bring strong support for the national MCAA Political Action Committee (MCAA-PAC).  All members of MCA of New Jersey’s board of directors just contributed to the MCAA-PAC. The MCA of Connecticut, ARCA-MCA, CPMCA and the MCA Kansas City, among others, also have 100% board participation.  Last year, the Association Executives Council (AEC) also responded with strong participation by local affiliate executives. The MCAA Board of Directors members have contributed generously to the MCAA-PAC. With multiemployer pension reform leading MCAA’s legislative priorities, participation levels have increased markedly.  Lend your support to MCAA advocacy efforts by contributing to the MCAA-PAC by making a contribution today.

ASHRAE President Tim Wentz to Attend MCAA 2017

Timothy G. Wentz, associate professor at the University of Nebraska-Lincoln, winner of MCAA’s highest honor – the Distinguished Service Award – and a three-time winner of MCAA’s Educator of the Year Award, became the 2016-2017 president of the American Society of Heating, Refrigerating and Air Conditioning Engineers (ASHRAE) during its annual conference in St. Louis, MO June 25-29.

He’s been preparing for this leadership role for many years as chairman of ASHRAE’s Members Council and President-Elect Advisory Committee and a member of the Chapter Volunteerism and Engagement Ad Hoc Committee and the Building Performance Alliance Ad Hoc Committee.

During this past year, Wentz has traveled to all corners of the world visiting and speaking to ASHRAE chapters and attending technical conferences.

MCAA is honored that President Wentz will participate in MCAA 2017 in San Diego, CA!

Prompt Payment Requirements Now in Effect

Small business subcontracting payment protections supplement those already in place in the Federal Prompt Payment Acts of 1982 and 1988 for construction subcontractors.

Those requirements (Far Part 52.232-5) require the prime contractor to pay the subcontractor within seven days of the prime’s receipt of payment for the subcontractors’ work.

The law permits the prime to impose retainage on the sub and permits withholding for written cause for specific performance deficiency. Interest is payable on late payments after seven days; interest accrues on payments withheld for cause after seven days as well. The payment rules affect all subcontractors on the covered project.

In addition, the Obama Administration has issued supplementary guidance to the Prompt Payment Act (PPA) calling for accelerated payments to small business prime contractors and subcontractors within 15 days of the contracting agency’s receipt of an invoice (the PPA permits agencies to take 30 days from receipt to pay the prime).

Click below to access OMB memos extending the accelerated payment procedures through December 2016.

OMB Memorandum

OMB Memorandum

PBGC Issues Reports on Future Status of its Multiemployer Plan Insurance Fund

The Pension Benefit Guaranty Corporation (PBGC) recently issued two reports underscoring its multiemployer plan insurance fund’s precarious position, predicting that complete insolvency is more likely than not by 2025, if not sooner.

The PBGC reports (PBGC MPRA Report, and FY2015 PBGC Projections Report) call for substantial if modulated minimum level premium increases as follows . . . “for the longer-term PBGC solvency scenarios, all four scenarios require a very substantial increase from the current $27 per participant premium rate, ranging from a 363 percent increase to a 552 percent increase.” They acknowledge that higher rate increases raise the likelihood of driving greater numbers of financially challenged plans into insolvency – compounding the need for further PBGC premium increases.

The reports offer some discussion of the Administration’s budget proposal for Congress to allow PBGC to set its own premiums, charge additional new risk-based premiums on multiemployer plans, and to charge an “exit” fee on sponsoring employers (not paid out of plan assets) to shore up PBGC resources.

In all this, there is little discussion on the impact of these measures on the competitiveness of plan sponsoring employers, or the tendency of PBGC premium issues and uncertainty to push sponsoring employers and plans out of the defined benefit system.

On these points, the PBGC MPRA report says: “Given the scale of the necessary premium increases, their design and structure are critical. A well-designed increase may encourage additional contributions, encourage continued participation in plans, and strengthen the multiemployer system. A poorly designed premium increase may encourage employer withdrawals and accelerate plan insolvency with a resulting cost to plan participants and a need for even larger premiums.”

House Education and Workforce Chairman John Kline (R-MN-2)(retiring), the leading proponent of the MCAA and NCCMP-backed composite plan proposal, cited the PBGC fiscal challenge as yet one more instance of the imperative need for Congress to modernize the multiemployer system. MCAA and the entire NCCMP Retirement Security Reform Coalition continue to press for new composite plan design options to be enacted by Congress.

Click here for the PBGC reports.

CEA Submits Construction Industry Priorities to National Party Platforms

Last week, the Construction Employers of America (CEA), of which MCAA is a member, submitted a list of construction industry policies to the national Democrat and Republican Parties to consider for inclusion in their platforms during their upcoming conventions.

In introducing these proposed policies, CEA explained that it “works to strengthen the construction industry and provide opportunities for top-quality construction workers to learn and maintain the skills they need to deliver highly productive, quality workmanship that provides the best value to project owners while earning high-value compensation and benefits for themselves, their families and their communities.”

The proposed policies would:

  • promote sound infrastructure policies;
  • modernize retirement plan options;
  • prepare the next generation of skilled workers;
  • invest in energy efficient buildings;
  • enhance manufacturing efficiency;
  • support responsible employers through bid listing; and
  • close the employee misclassification loophole.

Read the full policy proposals

Labor Department “Persuader” Rules Enjoined for Now

The Department of Labor (DoL)  issued new rules pertaining to reporting by labor relations consultants and counsel relative to “persuader” activity, which were to take effect on July 1, 2016.

Instead, a federal court issues a national injunction staying the rules for now while further challenges develop.

The Landrum-Griffin law previously required labor relations consultants hired by management to address employees in union organizing campaigns primarily to meet Landrum-Griffin reporting requirements. DoL has broadened those rules to conceivably include legal counsel advice to employer bargaining teams in collective bargaining negotiations, or representation at the bargaining table, beyond consultants’ basic role of addressing employees in an organizing context.

Prior legal challenges to enjoin the rules’ broader coverage of legal advice have failed, but legal challenges on eventual enforcement will continue. The reporting burden falls on the consultant and the association.

Most MCA and UA local agreements and relations are in the context of voluntary recognition construction prehire agreements, so the organizing context of the “persuader” rules are inoperative in the prehire agreement context. Check with your local labor counsel to determine whether this rule change might affect your working relationship with counsel for labor relations or collective bargaining. Click here to download a powerpoint from an Ice Miller webinar on the new requirements.

Bolton Meets with Secretary of Labor Tom Perez

Bob Bolton, a member of the MCAA Board of Directors and the MCAA Government Affairs Committee, discussed the recent Treasury Department decision to veto the Teamster Central States remedial benefit suspension proposal with Labor Secretary Tom Perez at a recent Rhode Island Chamber of Commerce event in Providence, RI.

Bolton raised the issue of the potential impact of Treasury Department Special Master Ken Feinberg’s reevaluation and denial of the Teamster Central States remedial plan and its potentially devastating impact on the Pension Benefit Guaranty Corporation (PBGC) multiemployer plan insurance fund. He also noted the devastating PBGC premium increases on all well-funded plans in other industries.

In response, Mr. Perez said that the Administration was carefully analyzing the impact on PBGC premiums and the collateral effects on healthy plans in other industries on an ongoing basis. Bolton attended the Rhode Island event just after lobbying the pension reform issue at the MCAA/Quality Construction Alliance National Issues Conference in Washington, DC.

National Issues Conference Attendees Focused on Critical Industry Issues

Close to 200 contractors and association executives attended the 2016 MCAA/QCA National Issues Conference in Washington, DC, last week to get the latest information on critical industry issues and to share their concerns about those issues with their Senate and House members.

During the three-day conference, over 120 visits took place between MCAA and Quality Construction Alliance (QCA) members and Congressional Representatives and Senators.

A long list of House and Senate representatives made this conference a success, briefing attendees on a wide range of issues affecting MCAA and allied association members’ business concerns.

Issues included:

  • A new bill to stem payroll fraud stemming from misclassifying employees as independent contractors from lead Representative Tom MacArthur (R-NJ);
  • Federal Infrastructure funding measures by Senator John Barrasso (R-WY), Congressman Lou Barletta (R-PA) and Representative John Delaney (D-MD);
  • Congressman Peter Welch (D-VT) addressed energy policy legislation; and
  • Representative David McKinley (R-WV) described the formation of the new bipartisan Congressional Building Trades Caucus.

The Conference also focused on recent critical regulatory developments. This part of the program consisted of three expert panel discussions which detailed developments on the Administration’s pending regulations to:

  • Require registered apprenticeship programs to file annual written affirmative action plans showing apprentice enrollment of women and minorities and the relation of that utilization rate to the availability of women and minorities in the apprenticeship recruitment area;
  • Executive Order 13673, requiring prime contractors and subcontractors competing for federal contracts and subcontracts of $500,000 or more to file legal compliance certifications for pre-award responsibility reviews; and
  • Executive Order 13706, requiring federal prime contractors and subcontractors to provide one hour of paid sick/family leave for every 30 hours their employees work directly on or related to (20% or more) a covered federal contract or subcontract.

All of the attendees enjoyed remarks from CNN news commentator and analyst Gloria Borger as she discussed the 2016 political scene.

mcgarveyThe program concluded with a strong address by Sean McGarvey, president of the North America Building Trades Unions, on:

  • The broad scope of NABTU (formerly BCTD) initiatives with owner/labor/management tripartite market councils;
  • Workforce development pre-apprentices outreach efforts to incorporate under-served potential workers into the construction industry;
  • Initiatives for economically targeted investments by pension plans to earn high return and support union construction; and
  • Ways to focus project owner/financing groups on collaborative efforts with the union-sector delivery system.

President McGarvey made very positive remarks on industry pension reform phase 2 efforts.

Pension and health plan benefits experts Cary Franklin and Aruna Vohra from Horizon Actuarial Services and Malcolm Slee and Josh Shapiro from Groom Law Group discussed a broad scope of tough challenges for attendees’ health and pension plans from the perspectives of either contributing employers or plan trustees.

The 2017 MCAA/QCA National Issues Conference will take place May 2-4, 2017, at the Marriott Georgetown Hotel in Washington, DC. So save the date!

Pension Reform Phase 2 Took Center Stage at the Newseum

Former Congressman George Miller took charge of the pension reform segment of the program at the 2016 National Issues Conference. He led an expert discussion of the alternate/composite plan proposal that MCAA and the Quality Construction Alliance are hoping to see adopted by Congress this year.

Mr. Miller and Randy DeFrehn of the National Coordinating Committee for Multiemployer Plans (NCCMP), along with Preston Rutledge, Senior Tax and Benefits Counsel for the Senate Committee on Finance, explained the many cross-currents on a variety of pension reform issues confronting Congress this year, including the need to shore up funding for the Pension Benefit Guaranty Corporation and recent developments affecting other union pension and health plans.

Former Congressman Miller summarized all the pension reform issues, based on his many years as the leading labor Democrat in the House, and encouraged the group to engage positively with Congress on this most essential reform for the industry.

MCAA participants reviewed a letter from the UA and MCAA leadership recently submitted to the Senate Finance Committee supporting composite plan reforms.
Download joint UA-MCAA Letter on Pension Reform

Treasury Department Rejects Teamsters’ Remedial Pension Plan

The Treasury Department’s Special Master, Kenneth Feinberg, rejected the remedial application of the Teamsters Central States’ pension plan to cut benefits in order to save the plan from even greater cuts due under the Pension Benefit Guaranty Corporation insolvency status.

Feinberg said the remedial plan actuarial and participant age assumptions were unreasonable, the benefits cuts were not distributed equitably across all participant categories and the explanation of the remedial plan did not meet the “understandability” criteria of the Pension Reform Act.

Reacting to the Treasury Department’s action, the Partnership for Retirement Security (sponsored by MCAA, the National Coordinating Committee for Multiemployer Plans and other signatory groups), said,

“While today’s decision by the U.S. Department of the Treasury to deny Central States Pension Fund’s rescue plan will temporarily spare many from cuts to their hard-earned benefits in the short-term, it also sentences participants to an insecure retirement where massive benefits cuts are inevitable. By their decision today, Treasury is gambling that Congress, which has flatly refused to assist these plans or the PBGC in the past, will now appropriate more than $100 billion required to rescue, not just Central States, but the entire system. It is a big bet. Unfortunately, rather than those who made the decision, it will be the pensioners who pay the price if it is lost.”

The NCCMP alternate plan design proposal – composite plans – which is designed to avoid the Central States type problem, will be at the top of the agenda for the Quality Construction Alliance National Issues Conference, which takes place in Washington, D.C. May 10-12.

MCAA President Tom Stone Addressed UA’s Tripartite Conference, Honored General President Bill Hite

During the United Association’s Eighth Annual Tripartite Conference in Chicago April 26, MCAA President Tom Stone highlighted the best-value proposition MCAA employers and UA labor present for construction owners nationwide.

President Stone’s remarks also included a video of the MCAA Lifetime Achievement Award presentation to General President Hite at the association’s 2016 convention.

U.S. Labor Secretary Tom Perez addressed the group and lauded the labor/management collaboration between MCAA and the UA nationally and locally as a model for widespread deployment in other U.S. industries. Secretary Perez commended the UA for its leadership in helping address and remedy the water contamination crisis in Flint, MI. He expressed strong support for prevailing wage law enforcement efforts and the Department of Labor’s efforts to crack down on widespread wage fraud nationally perpetrated by worker misclassification.

North America Building Trades Union (NABTU) President Sean McGarvey also addressed the conference, highlighting a new NABTU initiative to promote the deployment of pension plan investment policies that would yield high returns in projects using union labor.

MCAA Members Meet with House Ways and Means Committee Chair on Pension Reform

MCAA members met with House Ways and Means Committee Chairman Kevin Brady (R-TX) on pension reform on April 21, pressing for positive action by Congress that would allow plan trustees the option to consider adopting new pension plan designs, if appropriate for their area.

Meeting with Chairman Brady in Washington, DC, were MCAA members Barry Moore, President of Brandt Engineering (Dallas, TX), Jim Letsos, President/CEO of Letsos Company (Houston, TX), and MCA of Texas Executive Director Glenn Rex. They outlined the ways that the Solutions Not Bailouts legislative proposal would allow plan trustees to consider new options for multiemployer defined benefit plans that would reinvigorate the plan and workforce demographics, and improve long-term sustainability and MCAA member competitiveness and market share.

The new plan design proposal was pulled back from the Kline-Miller Multiemployer Plan Reform Act (MPRA) that passed in December 2014 with a promise for positive action in the next year, which fell short due to leadership changes in the House.

With the House leadership issues settled, MCAA and the National Coordinating Committee for Multiemployer Plans (NCCMP) are pressing again for Congressional action before this year’s session ends. And, pension reform will lead the agenda for the MCAA/Quality Construction Alliance National Issues Conference (May 10-12, Washington, DC). Former California Representative George Miller will moderate the pension reform panel discussion.

MCAA Leads Industry Group Seeking Industry Exemption from Paid Sick Leave Executive Order

An MCAA-led industry group provided analyses to the Office of Management and Budget (OMB), Office of Information and Regulatory Analysis (OIRA), and the Department of Labor’s (DoL) Wage and Hour Division as part of its efforts to obtain an industry exemption from President Obama’s Executive Order 13706—requiring paid sick leave accrual for those working on federal contracts—for employees covered by a collective bargaining agreement who are working on direct federal construction and federal facility HVAC service contracts.

MCAA representatives Adam Snavely of The Poole & Kent Co. (Baltimore, MD), Chip Mitchell of the Kirlin Group (Rockville, MD), Steve Weissenberger of MCA-Maryland, Bob Battista representing the MCA-MD and MCA Detroit and MCAA General Counsel John McNerney met with OMB/OIRA/DoL officials on February 11 to discuss the rationale for providing a collective bargaining exemption in the upcoming EO 13706 regulatory proposal.

MCAA’s position, also supported by the Construction Employers of America, laid out an analysis of ways to implement EO 13706 that are consistent with federal procurement, labor, and regulatory implementation policies. MCAA’s effort is aimed at gaining a favorable regulatory approach before a proposed regulation is published, rather than waiting for a proposed rule to be issued with less favorable options.

EO 13706 proposed regulations may be issued within the next month. MCAA’s initial letter to OMB and an outline of MCAA’s February 11 oral presentation are available by clicking on the links below.

Written Comments

Oral Presentation Outline

New Comprehensive Inventory of Construction Industry Multiemployer Pension Plans Released

MCAA, in conjunction with Horizon Actuarial Services, LLC, has released the Fourth Edition (February 2016) of its comprehensive inventory and analysis of construction industry multiemployer defined benefit pension plans for all 790 construction industry plans covering the 2004 through the 2013 plan years.

In releasing the report, MCAA President Steve Dawson said, “MCAA is extremely proud to partner with one of the premier actuarial firms in the industry, Horizon Actuarial Services, LLC to bring this ground-breaking work forward and maintain it on a periodic basis for the benefit of the industry… Before MCAA and Horizon began this collaboration, this type of comprehensive in-depth analysis of the Form 5500 database was not available….”

The report examines trends in plan demographics, cash flows, investment returns, funding status, and other plan costs and expenses over the plan years, which represent the most current Form 5500 data completely available for compilation and analysis.

The Inventory shows continuing steep challenges to the sustainability of the multiemployer system with long-term adverse demographic challenges remaining intractable, with fewer than seven active contributing employees for every 10 participants in the median plan data.

The Inventory data document the continuing need for Congressional action to enact reforms—such as the Solutions Not Bailouts legislative reform proposal. The proposal allows trustees to choose alternate plan designs—composite plans—that will build greater resilience and sustainability into the future of the valuable multiemployer defined benefit plan system for the industry workforce, sponsoring employers, and participants and beneficiaries of the plans. The Solutions Not Bailouts alternate plan design proposal option is strongly backed by MCAA and the National Coordinating Committee for Multiemployer Plans’ (NCCMP) legislative coalition.

Read the full news release about the Inventory at the link below. The Inventory is available as a free download to MCAA and MSCA members.

Download the Inventory

Read the News Release

Labor Department Releases New Guidance Affecting Misclassification of Employees

Labor Department Wage and Hour Administrator Dr. David Weil released a new Administrator’s Interpretation 2016-1: Joint Employer under the Fair Labor Standards Act (FLSA) and the Migrant and Seasonal Agricultural Worker Protection Act (MSPA).

This interpretive guidance, with less significance than a regulation, has primary significance to the construction industry as a way to stem rampant misclassification of employees as independent contractors, an unfair competitive advantage that some non-signatory firms have over signatory employers. This guidance also affects only wage-and-hour compliance and is separate from the controversy surrounding the new National Labor Relations Board’s (NLRB) joint employer ruling that is roiling unorganized firms in the context of union organizing efforts. In either case, the NLRB or Labor Department’s single employer policies have very limited application to union-signatory Section 8(f) contractors or prime contractors in the ordinary course of construction industry construction prime contract and subcontract commercial contract performance. Following is an example from the DoL Guidance derived from the air conditioning service industry:

A mechanic is employed by Airy AC & Heating Company. The Company has a short-term contract to test and, if necessary, replace the HVAC systems at Condor Condos. The Company hired and pays the mechanic and directs the work, including setting the mechanic’s hours and timeline for completion of the project. For the duration of the project, the mechanic works at the Condos and checks in with the property manager there every morning, but the Company supervises his work. The Company provides the mechanic’s benefits, including workers’ compensation insurance. The Company also provides the mechanic with all the tools and materials needed to complete the project. The mechanic brings this equipment to the project site. These facts are not indicative of joint employment of the mechanic by the Condos.

Click on the link below for the entire DoL release. Within that material is an example of a DoL enforcement action against a drywall firm for misclassification in that industry. Some comments indicate that construction prime and subcontract commercial contracts can be revised to address or defend against adverse application of these rules in the commercial contracting business. An initial analysis of those comments shows that regulators (see example above) are focused on the workforce realities of worker conduct and supervision, and boilerplate contract or subcontract terms will not be an effective defense against an adverse determination finding on a factual application of the single employer rules in either a union election process or a wage-and-hour misclassification context.

DoL Release