High Court Allows All-Union Pacts on Public Works : Labor: The 9-0 decision affects about 40% of construction work nationwide, including L.A. Convention Center and Metro Rail projects.

In an important victory for organized labor, the Supreme Court ruled Monday that government agencies can require that large public works projects use only union workers.

The 9-0 decision, which grew out of a dispute over the $6.1-billion cleanup of Boston Harbor, affects as much as 40% of construction work nationwide, including the Los Angeles Convention Center and Metro Rail projects.

Labor leaders and city officials applauded the decision and said it will help ensure labor peace and smooth-functioning construction projects.

Anti-union contractors complained that the decision will encourage all-union hiring and force up the cost of massive public projects. As much as 40% of the nation’s construction work is said to be funded by government.

“When the unions can successfully pressure a municipality to build union, they will,” said Joe Ivey, president of Associated Builders & Contractors, an organization encompassing non-union contractors. “The real loser in all of this is the taxpayer.”

Contractors who use non-union laborers had contended that cities and other public agencies should not be permitted to keep them from competing for huge public works contracts by signing “project agreements” that reserve jobs for union workers.

Their position was endorsed by the George Bush Administration and supported by a federal appeals court ruling in Boston, which held that the National Labor Relations Act forbids the government to take sides in favor of union over non-union work.

If the Supreme Court had affirmed that decision, a series of union agreements governing construction projects in Southern California could have been deemed to be illegal. Instead, however, the justices ruled that, when the government funds a project, it can impose the labor arrangements it thinks are best.

The Boston case arose when the state was ordered to rebuild a sewage system to stop seepage into the harbor. In 1988, the state’s water resources agency negotiated an agreement with the local Building and Trades Council that required union workers to be employed on the 10-year cleanup project.

But the Associated Builders & Contractors filed suit and won an appeals court ruling declaring that agreement illegal.

The justices, however, agreed to hear the union’s appeal in the case (Building Trades Council vs. ABC, 91-261) and reversed the decision.

“When a state owns and manages property . . . it is not subject to preemption by the NRLA,” Justice Harry A. Blackmun wrote for the court. The ruling leaves city or county officials with the power to negotiate agreements with union or non-union contractors.

Although the conservative-dominated high court rarely gives a victory to labor unions, it often defers to the authority of government officials.

Projects such as the Boston Harbor cleanup or Los Angeles Metro Rail can extend for a decade and involve scores of separate craft unions. In a typical project agreement, unions pledge not to strike, and municipal officials and their contractors promise to hire only union workers.

In Southern California, union leaders said they have negotiated two types of project agreements. The first, used for the Convention Center, specifies that only union laborers will be employed.

The second, used for Metro Rail, requires contractors to pay union wages on all work, even though the workers need not be union members.

“We gave up the right to strike, but they gave us a role in checking on the payment of prevailing wages,” said Ronald T. Kennedy, executive secretary of the Los Angeles-Orange County Building Trades Council.

Monday’s high court ruling is the second defeat for contractors on this issue in six weeks.

During the presidential campaign, Associated Builders & Contractors threatened to withhold an endorsement of George Bush if his Administration continued to permit federal contractors to sign project agreements limiting jobs to union workers.

Bush signed an executive order on Oct. 23 prohibiting such agreements on all federally funded construction projects. The contractors then endorsed Bush.

Two weeks later, however, Bush was defeated at the polls, and, in his second week in the White House, President Clinton revoked Bush’s order.

Clinton said he sought to “reduce unnecessary federal government intrusion into the workplace” and to permit federal contractors and labor leaders to negotiate project agreements.

Until Monday’s court ruling, however, it was not clear that such agreements were legal under federal labor law.

In a related development Monday, Clinton revoked a second Bush executive order that exempted federal contractors in South Florida, Louisiana and Hawaii from paying the “prevailing wage” on cleanup work after hurricanes Andrew and Iniki.