BC Liberal plan to stop Community Benefit Agreements would hurt local workers and the economy

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VICTORIA – Last week, the NDP government rolled out additional details on Community Benefit Agreements, which include:

  • An overall target of 25% apprenticeship hours over three years to address the skilled worker shortage left behind by the BC Liberals
  • Priority hiring for qualified workers who live within 100 km of projects
  • Collective agreements with workers that will help deliver projects on time and on budget by establishing stable labour costs and preventing strikes or lockouts

But Andrew Wilkinson’s BC Liberals and their big money supporters are doing everything they can to stop these agreements.

“As we work to invest in the next generation of the workforce, Andrew Wilkinson and the BC Liberals fight for the old way of building projects. Their plan to stop community benefit agreements would mean fewer jobs for local workers and would hurt our economy by making the skilled worker shortage even worse.” – Claire Trevena, Minister of Transportation & Infrastructure

In their efforts to stop these agreements, the BC Liberals and their allies have made a number of false claims. Here’s a rundown of their inaccurate statements – followed by the facts:

Claim: The CBA adds $100 million to the $1.377 billion budget for the Pattullo bridge.

Fact: An estimated increase of 4-7% is already included in the Pattullo budget. The increased cost helps pay for the overall goal of 25% apprenticeship hours over three years.

Because of the higher number of apprentices, more full-time staff are needed onsite to reach full productivity. While this means an investment up-front, the long-term economic benefits of training the next generation of skilled workers far outweigh the costs.

Without the 25 apprentice target, there are few incentives for employers to train apprentices – one of the causes of the skilled worker shortage BC is facing.

Claim: Project Labour Agreements are unsuccessful and drive up costs for taxpayers.

Fact: Agreements like this have a successful track record and have been used for decades in British Columbia and many other jurisdictions. For example, since 1963 seventeen BC Hydro dams have been built using PLAs. Every project was constructed on time and on budget.

They’ve also been used by private industry, including the Kitimat Modernization Project, which saw the Rio Tinto Alcan aluminum smelter upgraded. This project used a PLA signed between the Bargaining Council of the BC Building Trades and Bechtel. Roughly 7%-15% of workers were First Nations and the project saw a ratio of 23-26% apprentices on the job.

Project Labour Agreements are common in other jurisdictions, including California. The Los Angeles school district is currently $21 billion into a $28 billion building program through a Project Stabilization Agreement with the Building Trades.

A PLA is also being used on parts of a multi-billion dollar improvement program at Los Angeles International Airport (LAX). The PLA has an objective of 30% local worker participation and includes a community workforce development system to prepare workers for skilled labour careers.

Claim: The low-bid model is a better deal for taxpayers.

Fact: Projects ran massively over-budget under the BC Liberals using this model.

For example:

  • In 2005, the Port Mann Bridge was estimated to cost $1.5 billion. When all construction was completed in 2015, it cost $3.3 billion ($1.8 billion over budget).
  • When BC Hydro’s Northwest Transmission Line was first proposed, it was estimated at $404 million, but the final cost was $716 million ($312 million over budget).
  • The BC Place roof and renovations were originally estimated at $365 million. The final cost was $514 million ($149 million over budget).
  • The Vancouver Convention Centre, originally budgeted at $565 million, ended up costing taxpayers $900 million. ($335 million over budget).

With CBAs, wages are locked in for the duration of the project, and no strikes or lockouts can take place. These predictable labour costs help ensure projects are completed on time and on budget.

Claim: Only union contractors can bid on CBA projects.

Fact: CBAs allow all contractors to bid, whether they are union or non-union. CBAs allow contractors to bring all of their existing supervisors and most if not all of their workers. CBAs are good for local and small contractors because they level the playing field with known wage rates and access to qualified skilled trades workers, allowing more contractors to bid.

Recent examples show that non-union contractors will bid on projects with this type of agreement. The Los Angeles school district is currently $21 billion into a $28 billion building program through a Project Stabilization Agreement with the Building Trades. 50% of the contractors on this program are non-union. 42% of all contractors are small businesses.

Claim: Non-union workers will be cut out of working on government projects.

Fact: Although workers must join a union while they work on the project (as is the case with all unionized worksites in BC), they do not need to be unionized before or after working on the project.

No contractors are restricted from bidding on projects. Any contractor may bid, regardless of whether or not their workers are unionized.

Claim: 85% of the construction workforce chooses not to be affiliated with the BC Building Trades Unions. (According to the Independent Contractors and Businesses Association of BC)

Fact: This figure is misleading as it includes both non-residential and residential construction workforces. The residential construction workforce does not work on major infrastructure projects.

Community Benefits Agreements only cover non-residential construction projects like roads and bridges, which require specialized workers like pile drivers and structural ironworkers. Every labour market analyst tracks residential and non-residential labour supply separately.

These non-residential trades are unionized at a far higher rate than the residential construction workforce. There are 69,000 non-residential construction workers in British Columbia according to Build Force Canada’s 2018 Construction Outlook. The BC Building Trades is the largest supplier of labour in the province of British Columbia. With 40,000 members, it represents more than 58% of the non-residential construction sector.

Claim: There is no public policy rationale for requiring workers to become union members.

Fact: A unionized workforce significantly increases the number of skilled workers trained on the project. BC Building Trades apprenticeship graduation rates are 85% on average, the highest completion rates in the industry. Training more apprentices will address BC’s significant skilled labour shortage and help grow the economy.

Signing a collective agreement guarantees wage stability over the course of the project, helping deliver it on time and on budget. In projects with no collective agreements, wage costs can fluctuate unpredictably, causing them to go over budget.

Because the demand for skilled labour in B.C. is so high, there is little difference in costs between union and non-union labour.

A unionized environment ensures workers are treated fairly, receive equal wages for equal work, and are provided with additional supports, such as a long-standing drug-and-alcohol rehabilitation program for workers.