In its latest Settlements Report, the AGC-supported Construction Labor Research Council (CLRC) advises that construction-industry collective bargaining agreements settled from January through September of 2022 provide an average increase in wages and benefits of 3.8 percent in the first contract year. First-year increases negotiated during the period grew by 1.0 percent since 2020, which CLRC notes is a steep rate of growth. The last time first-year increases grew by 1.0 percent, it took seven years – from 2012 to 2019 – CLRC reports. Measured by dollar amount rather than percentage, CLRC found that the average first-year increase negotiated year-to-date was $2.33 – a $0.53 jump from 2021 and $0.70 from 2020.
The Pension Benefit Guaranty Corporation (PBGC) has proposed a regulation regarding interest rate assumptions in determining a withdrawing employer’s liability to a multiemployer plan, which could have significant implications for the unionized construction industry.
The U.S. Department of Labor has put forth a new test for determining whether someone is an employee or independent contractor under the Fair Labor Standards Act that could tilt the balance in that determination towards employee status.
Price escalation and supply chain disruptions continue to register as the number one issue in construction contracts today. The absence of a price escalation clause is considered a “killer clause” for many general contractors working on private vertical construction. Public owners are taking notice as well.
Future of “Significant Nexus” Test Remains Unclear”
Once consideration of Sen. Joe Manchin’s (D-W.Va.) environmental permitting reform bill was removed from the government funding bill, it easily passed the U.S. Senate and is expected to pass in the House as well.