Federal Judge: Government-Mandated PLAs “Stifle Competition” and Violate Federal Law

Judge: PLA Executive Order Violates Federal Contracting Law

Are state and local PLA mandates next?

On January 21, 2025, the United States Court of Federal Claims delivered a landmark decision in MVL USA, Inc. et al. v. The United States, ruling that government-mandated Project Labor Agreements (PLAs) violate the Competition in Contracting Act (CICA). The court found that PLAs “stifle competition” by unfairly excluding bidders unwilling to agree to union-backed PLAs, deeming them “an exclusionary policy unlawfully restricting full and open competition.”

The case, driven by multiple bid protests, highlighted how agencies ignored their own market research—showing PLAs increase costs and reduce competition—in favor of flawed, pro-PLA studies. Those studies, which are often cited by pro-PLA politicians, are effectively advocacy masquerading as research.  The judge specifically criticized them for failing to account for project-specific market conditions. Independent studies, such as the recent study by the Community Health and Environmental Policy Program at the non-partisan RAND Corporation for the Center on Housing and Homelessness in Los Angeles, find that PLA drive costs up by 21% on average.

While the decision directly impacts only the projects in this ruling, it sets a significant precedent, making future challenges to federal PLA requirements more likely to succeed. It also raises questions about state and local PLA mandates, such as those recently introduced in Loudoun and Fairfax Counties, which undermine open competition and may face similar legal scrutiny under applicable statutes.