A New Jersey construction company has filed a federal lawsuit challenging state mandates that require project labor agreements (PLAs) and adherence to targeted employment goals on public works projects. Earle Asphalt Co. alleges that these policies, enacted through recent legislation, violate constitutional protections and increase costs for taxpayers.
The lawsuit centers on recent changes in New Jersey law that expanded the use of PLAs and the implementation of hiring quotas. A PLA is a pre-hire collective bargaining agreement that requires contractors to hire workers through union halls and recognize unions as the exclusive bargaining representative for their employees. Previously, such agreements were generally limited to larger state projects, but a law signed in January by outgoing Gov. Phil Murphy removed cost-threshold rules, allowing municipalities to impose these mandates on a wider range of public works contracts.
Earle Asphalt, a non-union company since its founding in 1968, claims it was forced to withdraw its bid for a road repaving project in Evesham Township when the township council retroactively passed a resolution requiring PLAs. The company's original bid was the lowest at $1,463,513. After the PLA requirement was added and bids were re-evaluated, the lowest offer increased to $1,617,411, over $153,000 more than Earle's initial bid, according to the company.
The lawsuit also challenges New Jersey's policy requiring contractors to meet "targeted employment goals," which the company describes as race- and sex-based hiring quotas. Earle Asphalt contends that failing to meet these demographic targets can result in fines, penalties, and jeopardized future contracts. The company argues that it has historically hired based on merit, skill, and need, without discrimination, and that the state's requirements compel it to track employee demographics and potentially make hiring decisions based on race and sex, which it claims violates the Equal Protection Clause of the 14th Amendment.
Pacific Legal Foundation and the Wisconsin Institute for Law & Liberty are representing Earle Asphalt in the federal court case. The company argues that the PLA mandate infringes on the First Amendment's protection of the right to freely associate, and critically, the right not to associate, by compelling contractors to recognize and funnel money to unions as a condition of competing for public contracts.
Earle Asphalt asserts that these policies reduce competition by deterring non-union bidders, leading to higher costs for taxpayers. The company highlights its long-tenured employees, with an average tenure of 18 years, and its practice of second-chance hiring for individuals with criminal records. Michael Earle, co-owner of the company, stated that the fight is about his employees' right to make their own choices regarding union representation and the company's right to compete on merit.