Sheet Metal & Air Conditioning Contractors’ National Association

Issue Briefs

Paid Family and Sick Leave 2018

Construction Employers of America’s (CEA) Position

Paid family, medical and parental leave benefits should be left to individual employer decision making with respect to its position in its market, its own workforce requirements, and the competitiveness of its employee benefits offerings relative to competitors.

In cases of union-organized workplaces, employee benefits provision should be left to the fiduciary responsibility of the bargaining parties and the specific trade-offs of collective bargaining negotiations that are fully responsive to the dynamics of the specific workforce and the industry.

If public policy is nevertheless aimed at increasing mandated benefits, then there should be a single Federal rule that preempts state and local mandates. That Federal rule also should recognize the unique characteristics of employment in specific industries, and give full deference to the national policy of promoting collective bargaining by allowing exemptions for workforces covered by collective bargaining agreements in the construction industry (as several state and county wide laws do now).

Any Federally mandated family, medical or parental leave requirements must be enacted as an employee benefit requirement and so warrant Federal preemption of any state and local leave mandates. Moreover, any Federal mandate must recognize the unique characteristics of specific industry employment and provide rules and regulations that maintain performance and productivity requirements for that industry consistent with providing greater entitlement to leave.

In addition, any Federally mandated leave policy must also respect the national policy of promoting collective bargaining, and in the case of construction industry collective bargaining, provide an exemption from mandated leave entitlement for employees covered by collective bargaining agreements.

The Issue

Over the past several and more years, working family/employee group advocates have been pressing a national agenda to advance public policy mandating broader paid family, medical and parental leave requirements nationwide. Advocates note that the U.S. employment system/model lags behind other advanced economies in providing paid family, medical, and parental leave universally for employees. In the absence of a strong, successful push for a Federal law nationwide, advocates have settled on a strategy to approach state and local policymaking bodies to mandate specific leave policies in their discrete jurisdictions – increasing pressure on employers to accede to a single national standard to avoid many conflicting mandates.

As a consequence, there is a rapidly developing welter of non-uniform state and local policy mandates raising complex and difficult compliance issues for employers that conduct business or are domiciled in one or more jurisdictions with conflicting leave mandates. (In some cities, both the state and city or county ordinances apply.) As this trend continues unabated, increasingly Federal lawmakers are proposing a variety of single minimum Federal requirements that either would or would not preempt conflicting state and local requirements. Also, to lessen the compliance and enforcement burdens, some states are taking up statewide preemption of conflicting local or municipal mandates, allowing employers operating statewide to focus on a single compliance regime. In some areas, employee advocates resist both statewide preemption efforts; in many cases those groups too would oppose Federal preemption.

In some states and localities, policy makers have made a more discerning policy with respect to construction industry jobsite employment conditions, and have allowed covered leave exemptions for construction industry employers operating with jobsite collective bargaining agreements (CBA). These “construction CBA care outs” come in several varieties, with some offering blanket exemptions for construction employers with CBA-covered workforces, and others that require an explicit waiver of the leave requirements in the CBA. In either case, those policy reflect a discerning choice to respect both specific industry workforce conditions an requirements and to defer to bargaining parties judgments about their specific workforce conditions.

As the welter of state and local developments continues, national employer groups are finding the prospect for a single Federal requirement that preempts state and local requirements would promote economy and efficiency of operations for employers that operate in multiple jurisdictions – while at the same time achieving an updated national leave policy more in line with other advanced economies relative to workforce and family support policies.

Key Points

Construction industry jobsite employment and work requirements are radically different from employment patterns and work requirement in fixed-place, indefinite term employment in service, white collar, and fixed-placed production employment. Not one public policy mandate fits all industries. 

Construction employers (prime contractors and subcontractors that perform jobsite construction work) deliver that service with a unique workforce composition: the terms of employment for craft work are project specific, and for a definite term (completion of the project- subcontract). Construction firms’ employment rolls expand and contract continuously as projects begin and end. Many workers expect to be laid off at the end of a project, and in fact many may plan on and rely on breaks in service to attend to personal business while on a break in referral to future jobs. Compensation levels in the industry reflect that fluctuating nature of employment.

Moreover, work conditions themselves are different from fixed-place, indefinite term employment as most projects are performed with many separate employers (subcontractors) coordinating tightly scheduled separate subcontract work at a common site, with the job performance of one firm dependent on another subcontractors performing their sequence of work on time. Successful project completion is inextricably related to tight schedule conformance – and that in turn demands that worker attendance be scrupulously maintained to keep the sequence of subcontractor work on schedule so the project as a whole remains on schedule and on budget, and completed project operations begin on time. 

Construction jobsite crew compositions also are highly specific to promote efficient project delivery, as work crews contain a balanced mixed of skilled journeymen, apprentices, crew leaders, and subjourneymen workers to perform the subcontract work most efficiently – any unplanned absence of one member of a crew impairs the coordinated work and productivity of the whole crew -- putting timely performance of that sequence of work at risk for other subcontractors on the project. For all these reasons, industry pay, benefits and performance requirements all reflect the premium and high value that employers put on reliable work attendance and schedule compliance. All academic and business consultant studies reflect the well-known industry productivity and performance tenets – that schedule conformance leads to successful project completion, and work crew unplanned absences are the bane of successful project completion – causing delays, cost overruns, and contract claims and disputes.

Because of all these factors, construction industry jobsite employee collective bargaining agreements put a high premium on worker referrals from hiring halls and scrupulous attendance to keep crew mixes intact and subcontract performance on schedule. In fact, worker compensation and benefits contain a premium because of this high value on work attendance; and, worker compensation is high in part so workers may take time off between project referrals to attend to personal business. Virtually all project owners too place a high value on timely project completion and schedule conformance by all trade subcontractors – some industrial type project are on extremely tight schedule turnarounds, and the premium paid for that tight sequence of work is very high. Collective bargaining parties in the construction industry have bargained specific pay and benefits policies that are designed to meet the needs of workers, employers and project owners in the industry, acknowledging the unique performance requirements of workers and employers to deliver construction projects successfully. Federal policy should be discerning enough to allow bargaining parties in their best judgment representing their workforces and reflecting specific industry conditions to make trade-offs in pay in benefits that serve the specific needs of their industry. Moreover, and very importantly, pay and benefits in construction industry collective bargaining context are implemented on a multiemployer basis through jointly administered Taft- Hartley benefit plans. Because of the Federal labor policy mandate, these types of benefits are not subject to single employer administration, as the individual employers cannot deal directly with bargaining unit employee but must respect the employee bargaining representative with respect to terms and conditions of employment. 

Status

There are a number of various Federal legislative proposals on mandated family, medical and parental leave. The one proposal that contains at least one element meeting the CEA policy is H.R.4219, Workflex in the 21st Century Act, introduced by California Representative Mimi Walters (R-CA-45 – Irvine) and co-sponsored by Representatives Elsie Stefanik (R-NY-21, Watertown), Kathy McMorris Rodgers (R-WA- 5- Spokane).