A Project Labor Agreement between an owner and local trade unions provides for the hiring of qualified construction workers and guarantees labor stability on a construction project.

A PLA requires all employers to sign collective bargaining agreements with the appropriate trade unions for all work on the project. Collective bargaining enables working union members to negotiate with employers on terms of employment, including pay, benefits, hours, leave and safety policies. Employers are able to resolve issues at the bargaining level rather than through conflict, which reduces employee turnover by promoting open communication and job security.

Academic research has shown that PLAs are good for both public and private-sector construction projects, particularly larger projects. The validity of PLAs has consistently been upheld in both federal and state courts. PLAs do not adversely affect the costs of construction projects; rather, they positively influence project timeliness, quality, safety, training, minority employment, employee benefits and labor peace.