Find Legal Information

(This syllabus is not part of the opinion of the Court. It has been prepared by the Office of the Clerk for the convenience of the reader. It has been neither reviewed nor approved by the Supreme Court. Please note that, in the interests of brevity, portions of any opinion may not have been summarized).

    O'HERN, J., writing for the Court.

    This appeal presents the question whether a governmental agency has the power in setting bid specifications for public work to require a prospective contractor to enter into a "project labor agreement" with designated unions, under which the contractor must use the members of a specified labor organization on the project in exchange for the member unions' guarantees of labor stability.

    The New Jersey Turnpike Authority (TPA) began a project of widening a portion of the New Jersey Turnpike in 1990. After receiving from George Harms Construction Co., Inc. (Harms) the low bid for part of the widening project on August 24, 1993, the TPA adopted a resolution requiring contractors awarded contracts on the widening project to enter into project-labor agreements with Building and Construction Trades Council (BCTC) unions. The asserted basis for the resolution was the TPA's interest in avoiding labor disturbances, such as work stoppages that had previously occurred or been threatened at other TPA project sites, in part because of an ongoing conflict between a BCTC-affiliated local and the Steelworkers union to which Harms's employees belong.

    In addition to passing the resolution requiring project-labor agreements, the TPA passed another resolution that rejected all current bids on the contract on which Harms was the low bidder in order to allow re-bidding under the new policy. Harms protested the rejection by the TPA of its bid, but the TPA refused to reinstate the bid.

    Two weeks after adoption of the TPA resolutions, then-Governor Florio signed Executive Order No. 99, which required all State agencies to adopt project-labor agreements with BCTC affiliates whenever feasible and whenever such agreements would substantially advance, among other things, the interests of costs and efficiency.

    Harms and some of its Steelworkers employees appealed the TPA's adoption of the two resolutions. Another appeal was brought to the Appellate Division by the Utility & Transportation Contractors Association of New Jersey, Inc. (UTCA). The Appellate Division issued a single opinion that sustained the validity of the TPA resolutions, finding project-labor agreements not to be barred by federal law, the New Jersey Constitution or State public-bidding laws.

    The Supreme Court granted certification. Subsequent to oral argument, Governor Whitman issued Executive Order No. 11, which superseded Executive Order No. 99. The new executive order allows on a prospective basis project-labor agreements "on a project-by-project basis" and does not require the use of any particular union.

HELD: Although project-labor agreements serve important purposes in assuring efficient and economical administration of large construction projects, the public-bidding laws of New Jersey and the policies underlying them do not permit State agencies to require contractors to enter into project-labor agreements with designated labor organizations to the exclusion of all others. Resolution 19-93 of the TPA therefore is invalid.

1.    Harms was provided administrative due process because the company's attorney was given the opportunity to attend and to speak at the TPA Executive Session during which the resolutions establishing the project-labor-agreement requirement and vacating Harms's bid were adopted. The TPA is not required to reinstate Harms's bid. The Court does not decide whether the action of the TPA is subject to the notice-and-comment provision of New Jersey's Administrative Procedure Act, but suggests that the TPA would be well-served to conduct hearings before developing future policies for project-labor agreements. (pp. 10-14)

2.    The United States Supreme Court decision known as Boston Harbor, on which the TPA relied in part in adopting its resolution, holds that federal labor law does not bar a state from using project-labor agreements on public projects because in that situation a state is acting like any other purchaser of construction services and such other purchasers are freely permitted to enter into prehire agreements. (pp. 19-22)

3.    The Court does not decide whether the New Jersey Constitution, which grants the right to persons in private employment to organize and bargain collectively, prohibits project-labor agreements that require the use of specific unions on public projects, but sets forth the factors to be addressed in deciding whether the denial of public work because of union affiliation violates a fundamental constitutional right. (pp. 23-31)

4.    As a State agency the TPA is required to advertise publicly for bids and must award contracts to the lowest-responsible bidders in carrying out its responsibility to acquire, build, maintain, repair and operate turnpike projects. Competitive-bidding statutes serve important public purposes. Union affiliation has not been recognized in New Jersey as a criterion for determining the lowest-responsible bidder. (pp. 31-41)

5.    Bid specifications that designate a sole supplier of labor on a public project do not promote competition. Executive Order No. 11 recognizes the use of project-labor agreements when appropriate but does not designate a particular union or labor organization to be used on public projects. The executive order was intended to increase competition for public contracts. Because the TPA resolution requires the use of only BCTC-affiliated unions, it is not consistent with the policies of the public-bidding laws of New Jersey. (pp. 43-45)

6.    In delegating to State agencies authority to purchase construction services, the Legislature has not conferred on those agencies the authority to designate a sole source of construction services or to identify a particular union affiliation as a characteristic of the lowest-responsible bidder or as a bid specification. Although project-labor agreements may foster the important goals of labor peace, efficiency and cost savings, they have the effect of decreasing competition, which places them in conflict with the policy of this State's public-bidding laws to promote unfettered competition in public contracts. (pp. 45-49)

    The judgment of the Appellate Division is REVERSED.

     JUSTICE HANDLER, concurring, in which CHIEF JUSTICE WILENTZ joins, is of the view that the resolutions adopted by the TPA constitute rulemaking by a State agency and that, therefore, the case should be remanded to the TPA to permit it to comply with the rulemaking requirements for administrative agency action. The use of project-labor agreements is not barred by public-bidding laws. Also, Justice Handler disagrees with any implication by the majority that the constitutional right to organize is threatened by the resolution of the TPA and believes that such a question, not decided by the Court, should not have been the subject of extended discussion by the majority.

     JUSTICES CLIFFORD, POLLOCK, GARIBALDI and STEIN join in JUSTICE O'HERN's opinion. JUSTICE HANDLER filed a separate concurring opinion in which CHIEF JUSTICE WILENTZ joins.
SUPREME COURT OF NEW JERSEY
A-113/ 114 September Term 1993

GEORGE HARMS CONSTRUCTION CO., INC.,
a New Jersey corporation, RONNIE
ALLEN, CARLOS ALVAR, DAVID BADER,
CHRISTINE BALIKO, WILLIAM
MCMULLAN and BRUCE ROBERTSON,

    Appellants-Appellants,

        v.

NEW JERSEY TURNPIKE AUTHORITY, a
body corporate and politic,

    Respondent-Respondent.
--------------------------------------

IN THE MATTER OF THE ADOPTION OF A
RESOLUTION BY THE NEW JERSEY TURNPIKE
AUTHORITY REQUIRING CONTRACTORS TO
ENTER INTO PROJECT AGREEMENTS WITH
LABOR UNIONS

        Argued January 31, 1994 -- Decided July 7, 1994

On certification to the Superior Court, Appellate Division.

Theodore W. Geiser argued the cause for appellant George Harms Construction Co., Inc. (Connell, Foley & Geiser and Grotta, Glassman & Hoffman, attorneys; Mr. Geiser and Theodore M. Eisenberg, of counsel; Mr. Geiser, John F. Neary, Vincent E. McGeary, Guy T. Lytle, Michael Barabander, and Mark E. Tabakman, on the briefs).

Morris M. Schnitzer argued the cause for appellants Ronnie Allen, Carlos Alvar, David Bader, Christine Baliko, William McMullan and Bruce Robertson.

Steven E. Brawer argued the cause for appellant Utility & Transportation Contractors Association of New Jersey, Inc.
(Mandelbaum, Salsburg, Gold, Lazris, Discenza & Steinberg, attorneys).

Jeffrey J. Greenbaum argued the cause for respondent, New Jersey Turnpike Authority (Sills, Cummis, Zuckerman, Radin, Tischman, Epstein & Gross, attorneys; Mr. Greenbaum and Clive S. Cummis, of counsel; Mr. Greenbaum, Kenneth F. Oettle, Mark S. Olinsky, and Paul P. Josephson, on the briefs).

Vincent J. Apruzzese argued the cause for amicus curiae United States Chamber of Commerce (Apruzzese, McDermott, Mastro & Murphy, attorneys; Mr. Apruzzese, Francis A. Mastro, and Daniel F. Crowe, on the brief).

Christine Piatek, Deputy Attorney General, argued the cause for amicus curiae Attorney General of New Jersey (Deborah T. Poritz, Attorney General, attorney; Joseph L. Yannotti, Assistant Attorney General, of counsel).

Michael J. Herbert submitted a brief on behalf of amici curiae American Road & Transportation Builders Association, The New Jersey Asphalt Pavement Association, and The National Utility Contractors Association (Picco, Mack, Herbert, Kennedy, Jaffe & Yoskin, attorneys; Mr. Herbert, Patrick D. Kennedy, and Gregory J. Sullivan, of counsel and on the brief).

Frederick J. Rohloff and John C. Connell submitted a brief on behalf of amici curiae The Associated Builders and Contractors, Inc., Associated Builders and Contractors of New Jersey, and Associated Builders and Contractors of Northern New Jersey (Archer & Greiner, attorneys).

Richard D. Wilkinson submitted a brief on behalf of amicus curiae National Constructors Association (Lowenstein, Sandler, Kohl, Fisher & Boylan, attorneys; Robert W. Kopp, a member of the New York bar, of counsel).

Michael Critchley submitted a brief on behalf of amici curiae New Jersey State Building and Construction Trades Council and Building and Construction Trades Department, AFL-CIO.     The opinion of the Court was delivered by

O'HERN, J.

    This appeal presents the question of whether a State agency has the power to require a contractor doing business with it to enter into a "project labor agreement" with designated unions. A "project labor agreement" is a form of prehire agreement with labor organizations under which a contractor agrees to use the members of specified labor organizations on a project in exchange for the member unions' guarantees of labor stability. Such agreements serve important purposes in assuring efficient and economical administration of large construction projects. We hold, however, that our State public-bidding laws and the policies underlying them do not now contemplate the use of such agreements by State agencies to require contractors to hire members of only certain designated labor organizations to the exclusion of all others.

Inc. (Harms) bid the lowest price to perform Contract No. W-6411, which covered the stretch of the Turnpike between Interchanges 14 and 15E, known as the "Southern Mixing Bowl." Harms's bid price was $20,464,360, and the next lowest bid was $20,542,393. However, on the same day, the TPA's Director of Law issued an internal memorandum recommending that the TPA award Widening Project contracts only to contractors that had entered into "project labor agreements." For authority, that memo relied on Building & Construction Trades Council v. Associated Builders & Contractors, Inc., ___ U.S. ___, 113 S. Ct. 1190, 122 L. Ed.2d 565 (1993) (Boston Harbor), which established that the National Labor Relations Act (NLRA), 29 U.S.C.A. §§151 to 169, does not preempt the use of project-labor agreements by state agencies acting as market participants in the construction industry. On August 31, 1993, the TPA adopted Resolution 19-93, which provided, in pertinent part, the following:
            WHEREAS, in consideration of the critical nature of timely completion of the 1990-95 Widening Project * * * and the recent labor disruption affecting the Widening Project, it is in the best interest of the Authority to implement the use of project labor agreements with respect to all construction contracts awarded heretofore and hereafter as part of the Widening Project;

            NOW THEREFORE, BE IT RESOLVED that, for the foregoing reasons, as a condition of all contracts heretofore and hereafter advertised by the New Jersey Turnpike Authority in connection with the Widening Project, the Chief Engineer shall require contractors and subcontractors of all levels to enter into project labor agreements with the appropriate

affiliated locals of the Building and Construction Trades Council of the AFL-CIO of the State of New Jersey * * * .

Resolution 19-93 defined a "project labor agreement" as
        an agreement that recognizes designated unions as the exclusive bargaining representatives for all construction and craft employees, in exchange for the stipulation that there be no work stoppages, slowdowns, or disruptions during the life of the construction contract to which it applies, and which, therefore, contributes to a spirit of harmony, labor-management peace and stability during the life of that contract * * * .

Thus, Resolution 19-93 would have required the TPA to award the contract to the lowest-responsible bidder that had entered into a project-labor agreement with Building and Construction Trades Council (BCTC) unions.
    The preference in the awarding of contracts allegedly stemmed from the State's concern that, in the words of Resolution 19-93, "the Authority ha[d] recently experienced labor disturbances namely work stoppages * * * ." The TPA's Director of Law explained at the August 31, 1993, Executive Session that "[l]abor disturbances were threatened at Harms' construction site in the vicinity of Interchange 8A, and Harms requested that the [TPA] provide Harms' forces with State Police protection." The TPA's Chief Engineer was more specific: "[I]n light of the July 1993 statewide strike of highway and utility construction sites by Local 825 and the refusal of other AFL-CIO locals to cross Local 825's picket lines, any further strikes would cause

intolerable delays in light of the [TPA's] December 1995 deadline for completion of the Widening." Such delays would have hampered New Jersey's efforts to comply with federal clean-air requirements by 1996 to obtain federal transportation funds, and certain permits from the Army Corps of Engineers might have expired if work had been interrupted.
    The conflict between the BCTC-affiliated Operating Engineers Local 825 and the United Steelworkers of America (the Steelworkers), to which Harms's employees belong, apparently stems from a jurisdictional dispute. As we understand that dispute, it revolves around the contrasting work patterns of the two unions. Steelworkers members will apparently perform a wide variety of different tasks, such as operating heavy machinery, digging ditches, and carpentry. Members of Local 825, on the other hand, only operate heavy machinery. When BCTC unions are involved, carpentry and digging must be performed by members of the Carpenters' and Laborers' Unions, not by the International Union of Operating Engineers.See footnote 1
    On August 27, 1993, the TPA's Chief Engineer delivered a letter to Harms's president notifying Harms of a proposed project-labor-agreement requirement. The letter stated that the

TPA would adopt the policy on August 31, 1993, and that the policy would apply to Contract No. W-6411 retroactively. The letter did not state that the policy would require Harms to sign the project-labor agreement with a BCTC affiliate. Harms assertedly discovered that fact when its counsel appeared at the TPA's Executive Session on August 31, 1993. Harms's counsel protested the policy because inasmuch as Harms had a long-standing collective-bargaining agreement with the Steelworkers, the NLRA precluded Harms from signing a project-labor agreement with any other union. However, the TPA disregarded Harms's objections and passed Resolution 19-93 as well as Resolution 25-93, which provided for the rejection of all current bids on Contract No. W-6411 to allow rebidding under the new policy. On September 15, 1993, the TPA's Executive Director denied Harms's appeals protesting the TPA's rejection of Harms's bid and refused to reinstate the bid.
    On September 13, 1993, then-Governor Florio executed Executive Order No. 99, which required all State agencies to adopt project-labor agreements with BCTC affiliates "whenever feasible and whenever such agreement[s] substantially advance[] the interests of costs, efficiency, quality, safety, timeliness and the State's policy regarding minority- and women-owned businesses * * * ." 25 N.J.R. 4543 (Oct. 4, 1993).
    On September 14, 1993, Harms and some of its employees who belong to the Steelworkers appealed the TPA's adoption of

Resolutions 19-93 and 25-93. The Appellate Division heard that appeal with another appeal brought by the Utility and Transportation Contractors Association of New Jersey and subsequently issued a single unreported opinion sustaining the validity of the TPA's resolutions. The court held that the TPA's project-labor-agreement requirement for the Widening Project is permissible under the NLRA and that such agreements do not infringe on a person's constitutional right "to organize and bargain collectively." N.J. Const. art. I, ¶ 19. Further, the court rejected Harms's contention that the TPA could not incorporate project-labor agreements into bid specifications without agency rulemaking. It found that those agreements do not conflict with the statutory duty of the TPA to award contracts to "the lowest responsible bidder."
    We granted certification, 134 N.J. 560 (1993). Subsequently, on March 21, 1994, newly-elected Governor Whitman issued Executive Order No. 11, 26 N.J.R. 1558-59 (Apr. 18, 1994), which superseded Executive Order No. 99. Executive Order No. 11 allows project-labor agreements only "on a project-by-project basis" and does not require the use of any particular union. Because Executive Order No. 11 explicitly declares that it is "to have prospective effect only," 26 N.J.R. at 1559, the appeal before us is not moot.

    Appellants argue that the agency's resolutions are rules within the statutory definition of the Administrative Procedure Act (APA), N.J.S.A. 52:14B-1 to -21, and therefore that the agency must comply with the notice-and-comment provision of N.J.S.A. 52:14B-4. That provision essentially requires that prior to the adoption of any rule, the agency shall give at least thirty-days notice of its intended action; provide a summary of the proposed rule, with an opportunity for all interested persons to submit data, views, or arguments in writing or orally; and prepare a report summarizing the content of such submissions and the agency's response to those views, data, and arguments.
    This Court's decision in Metromedia, Inc. v. Director, Division of Taxation, 97 N.J. 313 (1984), delineates the appropriate test to apply when determining whether an agency action constitutes rulemaking. Among the factors to be considered are: (1) the segment of the public to be affected; (2) the generality of application; (3) the prospectiveness of the result; and (4) the novelty of the legal standard announced. Id. at 331-32. All such factors need not be present for an agency determination to constitute rulemaking. Id. at 332. The agency

should balance the factors according to weight, not number. In re Request for Solid Waste Util. Customer Lists, 106 N.J. 508, 518 (1987).
    The TPA denies that the Metromedia factors are implicated. It contends that the specification of project-labor agreements is altogether exploratory and tentative as applied to the Widening Project and thus does not constitute rulemaking. Appellants contend that the policy is far more extensive than that because it will apply to all succeeding Turnpike-improvement projects. They further contend that the agency adopted the policy hurriedly, without consultation or comment from any members of the interested public. We do not resolve in this case whether this agency action is subject to the strict requirements of N.J.S.A. 52:14B-4. We believe that the substantive issues transcend those procedural issues. We are certain, however, that whatever policies for project-labor agreements the TPA pursues, it would develop such policies more effectively following a hearing process. In addition, that process would establish a record against which the contesting claims under constitutional and statutory guidelines could be better assessed by a reviewing court. Specifically, if the record clearly established the relationship between the specifications and the policies of the bidding laws, we could better resolve the question of compliance with public-bidding laws. For example, a detailed record with comment and response as frequently occurs in the rulemaking

context, see N.J.S.A. 52:14B-4, might have better explained how Harms's present employees might have fit into the bidding scheme. Could Harms have retained them as the TPA believes, or did the hiring-hall provisions effectively exclude them? A project-labor agreement has many subtle and complex facets, infra at ___ (slip op. at 14-18), and overall agency policy should address the merits of the plethora of issues that are proper for inclusion in a project-labor agreement.

establishing the project-labor-agreement requirement and the resolution vacating Harms's bid were adopted. We agree. Principles of administrative due process do not require that we reinstate Harms's bid.
    Although the TPA did not deny Harms administrative due process, we resolve here the remaining question whether the TPA had the authority to reject all bids after it had opened Harms's bid. In Cardell, Inc. v. Township of Woodbridge, 115 N.J. Super. 442, 450 (App. Div. 1971), the court noted that public entities do not have "unbridled power to reject bids, even where such right is served in the invitation for bidding" because such power would violate public policy and competitive-bidding laws. However, the court stated:
            We do not imply that a [public entity] is without power to reject all bids under proper circumstances. No [public entity] could effectively engage in competitive bidding without such power. At the very least, the existence of the possibility of total rejection of bids serves as a strong inducement to bidders to keep their bids as low as circumstances permit. Suffice it to say that when a [public entity] concludes in good faith that the purposes of the public bidding statute are being violated, it may reject all bids submitted and in its discretion order a readvertising of the contract. Furthermore, * * * should circumstances arise which might cause the [public entity] to abandon or substantially revise the project, then a total rejection of bids might well be required.

The Appellate Division, in M.A. Stephen Construction Co. v. Borough of Rumson, 117 N.J. Super. 431, 438 (1971), applied the Cardell rationale and held that a public entity could not circumvent the requirement of our public-bidding laws to award contracts to the lowest responsible bidder by the entity's arbitrary or unreasonable action. Further, the M.A. Stephen court held that a public entity had the right to reject all bids and the duty to exercise that right "in good faith and for sound public reasons." Ibid.
    The TPA's Resolution 25-93 rejected all bids received for Contract No. W-6411 because the bid specifications provided to prospective contractors lacked the requirement that contractors enter into a project-labor agreement with appropriate BCTC unions. That resolution, together with Resolution 19-93, contained the TPA's reasoning for rejecting the bids. The TPA materially changed its specifications incorporating the project-labor requirement to ensure prompt settlement or prevention of labor disputes in the public sector, which is our State's declared policy, see N.J.S.A. 34:13A-2; to guarantee labor stability; and to advance harmonious labor-management relations. In the best interest of the TPA and the public, the TPA wanted to complete in a timely manner the Widening Project within the Project's budget. The TPA had experienced work stoppage on the Widening Project for approximately three weeks in July 1993. That circumstance, along with the Boston Harbor decision, caused

the TPA to "substantially revise the project" by including a bid specification requiring potential contractors to enter into project-labor agreements with BCTC unions and rejecting all bids submitted on Contract No. W-6411. Cardell, supra, 115 N.J. Super. at 451. The TPA may have erred in its view of the law, but on this record, no evidence exists to show that in rejecting all bids the agency acted other than in good faith, in its interest, and in the interest of the public.
    

            Because of its large size, construction exerts its influence on other sectors of industry and impacts their labor relations.

However, the author proceeds to observe that although the construction industry's economic significance may be national in scope, "[t]here can be no replacement for the reality that, even if some of the individual components may change or are imported from outside a local labor market, the ultimate assembly of a bridge or a building remains a localized affair." Ibid.
    The pattern of employment in the construction industry is characterized by employee mobility. Workers are assembled for specific jobs. A general contractor often subcontracts portions of the job according to interest and ability. The subcontractors may also delegate various aspects of their work. As a result, the industry uses union hiring halls as a primary source of labor. (A hiring hall is a place where workers report and the union refers those workers to contractors for employment.)
    Obviously, to compete successfully in the market, a bidder must know the cost of labor for a job. What is known as a "Little Davis Bacon Act" or a "Prevailing Wage Statute" requires New Jersey contractors, as it does those in other states, to pay the prevailing-wage rate on public-bidding projects. N.J.S.A. 34:11-56.27. Because the construction industry is still substantially unionized, that requirement in effect means paying

union wages on public jobs. Consequently, most public contractors have used union employees on public-works projects. Different unions, however, have different work practices. See supra at ___ (slip op. at 6).
    Contractors also use prehire agreements to ensure labor-cost predictability. "A pre-hire agreement is a contract agreed to by an employer and a union before the workers to be covered by the contract have been hired." International Ass'n of Bridge, Structural & Ornamental Iron Workers v. NLRB, 843 F.2d 770, 773 (3d Cir.), cert. denied, 488 U.S. 889, 109 S. Ct. 222, 102 L. Ed.2d 213 (1988). Initially, the National Labor Relations Board (NLRB) had determined that prehire agreements were illegal in that they designated an exclusive union representative for the employees before an election had been held. Recognizing the impact of that holding in the construction industry, Congress added section 8(f) to the NLRA in 1959. That section provides:

        It shall not be an unfair labor practice * * * for an employer engaged primarily in the building and construction industry to make an agreement covering employees engaged (or who, upon their employment, will be engaged) in the building and construction industry with a labor organization of which building and construction employees are members * * * because (1) the majority status of such labor organization has not been established * * * or (2) such agreement requires as a condition of employment, membership in such labor organization * * *.

Thus, section 8(f) expressly authorizes negotiation, adoption, and implementation of collective-bargaining agreements in the construction industry without initial reference to the union's actual majority status and permits such agreements to contain union-security clauses. In that amendment, Congress specifically sanctioned established industry practices that the NLRB had previously found unlawful. However, although section 8(f) permits employers and unions in the construction industry to enter into prehire agreements that designate a union as the exclusive representative without a formal election, the employees, now union members, may vote to decertify the union as their exclusive representative, using the formal NLRA procedures. 29 U.S.C.A. §159(e).
    Employees may belong to a local union of their craft that sends representatives to a council such as the BCTC. Among its other functions, a council may act as bargaining agent and it may conduct negotiations for its member unions. Generally, a council is financially supported by the local unions, which in turn pass on the cost to their members. Employers will often enter master agreements with councils such as BCTC to mitigate the effect of jurisdictional disputes among unions on the progress of construction projects. Such councils have been recognized as labor organizations for purposes of the NLRA. NLRB v. Metallic Bldg. Co., 204 F.2d 826 (5th Cir. 1953), cert. denied, 347 U.S. 911, 74 S. Ct. 473, 98 L. Ed. 1068 (1954); Southeast La. Bldg. &

Constr. Trades Council v. Scheyd, Brennan, Inc., 334 F. Supp. 720 (E.D. La. 1971).
    A project-labor agreement is a form of master agreement limited to one project. Most such agreements
        require[] the contractors and subcontractors to recognize [a particular labor organization] as bargaining representative for all craft employees, to hire workers through the hiring halls of the [organization's] constituent unions, to require hired workers to join the relevant union within seven days, to follow specified dispute-resolution procedures, to apply the [organization's] wage, benefit, seniority, apprenticeship and other rules, and to make contributions to the * * * unions' benefit funds. In return for the [proprietor's] promise to insist that contractors sign the agreement, the [organization] * * * promise[s] the [proprietor] labor peace throughout the * * * life of the construction project.

            [Associated Builders & Contractors, Inc. v. Massachusetts Water Resources Auth., 935 F.2d 345, 360 (1st Cir. 1991) (Breyer, C.J., dissenting), rev'd sub nom. Building & Constr. Trades Council v. Associates Builders & Contractors, Inc., ___ U.S. ___, 113 S. Ct. 1190, 122 L. Ed.2d 565 (1993).]

In this case, the TPA required contractors and subcontractors working on the Widening Project to enter into a project-labor agreement with the New Jersey BCTC, an AFL-CIO organization comprised of several different unions representing various crafts.

    In his August 24 memorandum to the Executive Director of the TPA, the agency's Director of Law referred to the Boston Harbor decision as the legal basis for the TPA's adoption of Resolution 19-93:
            Recent analysis by General Counsel of the [Boston Harbor] case confirms that the New Jersey Turnpike Authority could legally enforce pre-hire arrangements between contractors and labor unions working on the Turnpike. Specifically, the Authority, by way of supplemental bid specifications, could require that a contractor on a given construction project enter into a project labor agreement guaranteeing stability for the life of the project.

    The issue in Boston Harbor was whether the Massachusetts Water Resource Authority could require as a condition for a contract award that the winning bidder and its subcontractors abide by a project-labor agreement previously negotiated between Kaiser Engineers, Inc. and the Boston Metropolitan District BCTC. That agreement recognized BCTC as the exclusive bargaining representative for all workers employed to build sewage-treatment facilities for the cleaning of Boston Harbor in return for BCTC's promise of labor peace throughout the ten-year life of the construction project. Specifically, the question was whether the agreement violated the NLRA.

    Two types of federal-labor-law preemption forbid certain kinds of state action. They are succinctly described in Boston Harbor as follows:
        The first, "Garmon pre-emption," forbids state and local regulation of activities that are "protected by § 7 * * *, [which establishes the right of employees to organize, bargain collectively, and engage in peaceful picketing and strikes,] or constitute an unfair labor practice under § 8." * * *

            A second pre-emption principle, "Machinists pre-emption," prohibits state and municipal regulation of areas that have been left "`to be controlled by the free play of economic forces.'"

            [Boston Harbor, supra, ___ U.S. at ___, 113 S. Ct. at 1194-95, 122 L. Ed. 2d at 574-75 (citations omitted) (quoting San Diego Bldg. Trades Council v. Garmon, 359 U.S. 236, 244, 79 S. Ct. 773, 779, 3 L. Ed.2d 775, 782 (1959), and Machinists v. Wisconsin Employment Relations Comm'n, 427 U.S. 132, 140, 96 S. Ct. 2548, 2553, 49 L. Ed.2d 396, 403 (1976) (quoting NLRB v. Nash-Finch Co., 404 U.S. 138, 144, 92 S. Ct. 373, 377, 30 L. Ed.2d 328, 333 (1971))).]

That latter preemption principle is well illustrated by Golden State Transit Corp. v. City of Los Angeles, 475 U.S. 608, 106 S. Ct. 1395, 89 L. Ed.2d 616 (1986), in which the Court held that federal labor law preempts a city's power to condition the renewal of a taxi franchise on settlement of a labor dispute.
    The theory of the Boston Harbor decision is that when a state acts as a market participant, it does not act as a

regulator in areas of national labor policy that are preempted by the NLRA. Justice Blackmun wrote:
            When we say that the NLRA pre-empts state law, we mean that the NLRA prevents a State from regulating within a protected zone, whether it be a zone protected and reserved for market freedom, or for NLRB jurisdiction. A State does not regulate, however, simply by acting within one of these protected areas. When a State owns and manages property, for example, it must interact with private participants in the marketplace. In so doing, the State is not subject to pre-emption by the NLRA, because pre-emption doctrines apply only to state regulation.

            It is evident from the face of the statute that in enacting exemptions authorizing certain kinds of project labor agreements in the construction industry, Congress intended to accommodate conditions specific to that industry. Such conditions include, among others, the short-term nature of employment which makes post-hire collective bargaining difficult, the contractor's need for predictable costs and a steady supply of skilled labor, and a long-standing custom of prehire bargaining in the industry.

            There is no reason to expect these defining features of the construction industry to depend upon the public or private nature of the entity purchasing contracting services. To the extent that a private purchaser may choose a contractor based upon that contractor's willingness to enter into a prehire agreement, a public entity as purchaser should be permitted to do the same.

            [Boston Harbor, supra, ___ U.S. at ___, ___, 113 S. Ct. at 1196, 1198, 122 L. Ed. 2d at 575-76, 578-79 (citations omitted).]

Thus, under Boston Harbor, federal labor law does not prohibit a state entering the construction market from using the same construction-industry exception regarding project-labor agreements that private purchasers of construction labor use. However, a state's laws may prohibit a project-labor-agreement specification in public contracts without running afoul of the NLRA. Garmon preemption does not apply because a state-law prohibition of project-labor agreements on public projects is merely one way in which a state may choose to act as a market participant in the construction industry. In other words, a state may choose to enter or not to enter a project-labor agreement just like any other purchaser of construction services. Machinists preemption also does not apply because a state-law prohibition of project-labor agreements on public projects does not constitute impermissible regulation of an area that the NLRA contemplated would be left to the free play of economic forces. Such a prohibition amounts to nothing more than the public equivalent of a corporation's by-law regarding the purchase of construction services. In short, when a state uses project-labor agreements on public projects, it is not acting as a regulator of private actors; rather, it is merely defining its role as a proprietor/purchaser of labor in the construction industry. Thus, because the NLRA does not preempt the field, we must determine whether New Jersey law prohibits project-labor agreements.

    Courts have only a limited role to play in reviewing the actions of other branches of government. In light of the executive function of administrative agencies, judicial capacity to review administrative actions is severely limited. Gloucester County Welfare Bd. v. New Jersey Civil Serv. Comm'n, 93 N.J. 384, 390 (1983). Courts can intervene only in those rare circumstances in which an agency action is clearly inconsistent with its statutory mission or with other State policy. Although sometimes phrased in terms of a search for arbitrary or unreasonable agency action, the judicial role is restricted to four inquiries: (1) whether the agency's decision offends the State or Federal Constitution; (2) whether the agency's action violates express or implied legislative policies; (3) whether the record contains substantial evidence to support the findings on which the agency based its action; and (4) whether in applying the legislative policies to the facts, the agency clearly erred in reaching a conclusion that could not reasonably have been made on a showing of the relevant factors. Campbell v. Department of Civil Serv., 39 N.J. 556, 562 (1963); In re Larsen, 17 N.J. Super. 564, 570 (App. Div. 1952). We address in this opinion only the first two factors, i.e., whether the action violates either constitutional principles or express or implied

legislative policies. Before we consider the issues of legislative policy, we examine the implications of the TPA's actions in light of the New Jersey Constitution's collective-bargaining-rights provision.

    Certain appellants and certain amici contend that the New Jersey Constitution prohibits project-labor agreements that require the use of specific unions on public projects. They believe that even if authorized by the Legislature, such project-labor agreements do not accord with constitutional principle. Other appellants and amici disagree. Because we decide this case on statutory grounds alone, we need not resolve the constitutional questions. See, e.g., O'Keefe v. Passaic Valley Water Comm'n, 132 N.J. 234, 240 (1993) (holding that "courts should not reach constitutional questions unless necessary to the disposition of the litigation"). However, we set forth the arguments of the parties and some of the concerns a court would have to address in deciding the constitutional issues.
    The New Jersey Constitution declares in paragraph 19 of article I that "[p]ersons in private employment shall have the right to organize and bargain collectively." Although "we regard the 'experience and adjudications' under the N.L.R.A. as

appropriate and helpful guides for the implementation of Article I, paragraph 19," Comite Organizador de Trabajadores Agricolas v. Molinelli, 114 N.J. 87, 98 (1989), NLRA precedents do not define the State constitutional right in the absence of preemption. (Paragraph 19 was intended to protect workers who are not covered by the NLRA. See Richard A. Goldberg and Robert F. Williams, Farmworkers' Organizational and Collective Bargaining Rights in New Jersey: Implementing Self-Executing State Constitutional Rights, 18 Rutgers L.J. 729, 742 (1987).) Thus, State law defines the scope of the constitutional right guaranteed by paragraph 19. In that respect, our courts have held that "the right to organize and bargain collectively is not only constitutional in its dimension but should be accorded the `same stature as other fundamental rights.'" Communication Workers v. Atlantic County Ass'n for Retarded Citizens, 250 N.J. Super. 403, 408 (Ch. Div. 1991) (quoting Cooper v. Nutley Sun Printing Co., 36 N.J. 189, 197 (1961)).
    Under federal Fourteenth Amendment analysis, "[w]hen * * * legislation regulates `fundamental rights' * * *, it will be subject to `strict scrutiny' and the state will be required to demonstrate (1) that a compelling need justifies the legislation and (2) that no less restrictive alternative will accomplish that state objective." United States Chamber of Commerce v. State, 89 N.J. 131, 157-58 (1982). However, we have held that
            [t]he analysis of fundamental rights under the New Jersey Constitution differs

from analysis of those rights under the United States Constitution. Starting with our decision in Robinson v. Cahill, 62 N.J. 473, 491-92, cert. denied sub nom. Dickey v. Robinson, 414 U.S. 976, 94 S. Ct. 292, 38 L. Ed.2d 219 (1973), we began to develop an independent analysis of rights under article 1, paragraph l. Thereafter, we rejected two-tiered equal protection analysis and employed a balancing test in analyzing claims under the state constitution. In striking the balance, we have considered the nature of the affected right, the extent to which the governmental restriction intrudes upon it, and the public need for the restriction.

         [Greenberg v. Kimmelman, 99 N.J.
         552, 567 (1985) (citations omitted).]

In applying that three-part balancing test, the more personal the right, the greater the public need must be to justify governmental interference with the exercise of that right. See Taxpayers Ass'n v. Weymouth Township, 80 N.J. 6, 43 (1976), cert. denied, 430 U.S. 977, 97 S. Ct. 1672, 52 L. Ed.2d 373 (1977). Whether characterized as the denial of equal protection or the infringement of a fundamental right, the analysis would largely be the same.
    "Freedom of choice in selecting one's bargaining agent is the very essence of collective bargaining. The courts of this State have recognized, at least inferentially, that N.J. Const. 1947, Art. I, sec. 19, guarantees this freedom of choice * * * ." Independent Dairy Workers Union v. Milk Drivers and Dairy Employees Local No. 680, 23 N.J. 85, 96 (1956) (citations omitted). That freedom of choice demands that "when a group of persons in private employment [has] freely exercised [its] right

to choose a bargaining representative, the will of the majority may not be undermined by picketing where the sole object is economic duress upon the employer and the employees." Id. at 97-98. Thus, no third party, including another union, may exert economic coercion on a group of employees to influence its choice of bargaining representatives.
    The question presented by some of the plaintiffs here is whether the State or one of its agencies has improperly coerced New Jersey construction workers in their choice of bargaining representatives by favoring one group of unions over others in the award of public contracts. The TPA's Resolution 19-93 required all contractors performing Widening Project contracts to sign project-labor agreements with a designated labor organization. Then-Governor Florio's Executive Order No. 99 broadened that requirement to include all State construction contracts. Efforts by a labor organization to interfere with the statutory rights of workers under the NLRA to elect a bargaining representative of their own choosing are questionable under Independent Dairy Workers, supra, 23 N.J. 85. See 29 U.S.C.A. §158(b)(4)(ii)(D) (making it unfair labor practice for labor organization to strike or engage in other coercive activity for the purpose of "forcing or requiring any employer to assign particular work to employees in a particular labor

organization").See footnote 2 Accession to demands that infringe constitutional rights has been held elsewhere to comprise a civil-rights violation. See, e.g., Redgrave v. Boston Symphony Orchestra, Inc., 502 N.E.2d 1375 (Mass. 1987) (holding that under Massachusetts Civil Rights Act, defendant may be liable for interference with rights of another even if defendant had no personal desire to abridge those rights, but merely acquiesced to pressure from third parties who did wish to abrogate such rights). Of course, this begs the question of whether any rights have been infringed. The parties disagree about that point.
    Employees of Harms argue as appellants that the TPA has diminished the State constitutional rights of New Jersey construction workers to choose a union free from external pressure. The TPA counters that it has not denied any Harms employees the right to be represented by labor organizations of their own choosing and that Harms is free as well to obtain workers through its preferred labor organization. The TPA essentially argues that it has denied neither Harms nor its employees any rights; rather, it has merely denied Harms and its employees the privilege of obtaining Turnpike contracts. That reasoning recalls Justice Holmes's famous aphorism: "A policeman

may have a constitutional right to talk politics, but he has no constitutional right to be a policeman." McAuliffe v. Mayor of New Bedford, 29 N.E. 517, 517-18 (Mass. 1892). More subtle and indeed more complex principles are now employed to analyze the dispensation of government benefits. The question today is whether the government has unreasonably burdened the exercise of a constitutional right by conditioning the dispensation of a government benefit (i.e., a public contract) on how one has exercised that right (i.e., which union a bargaining unit has chosen). See, e.g., Sherbert v. Verner, 374 U.S. 398, 83 S. Ct. 1790, 10 L. Ed.2d 965 (1963) (striking down denial of unemployment benefits to Seventh-day Adventist whose employer had discharged her because she refused to work on Saturday in accordance with her religious beliefs). Through restrictive conditions on the award of public contracts, the State could theoretically limit the freedom of choice that New Jersey construction workers currently exercise in designating unions to bargain for them. And if the State could favor one union over another, it could favor, by the same logic, nonunion contractors over union contractors.     
    Although "[t]he right to employment on a local public works project, like the right to a city job, is not fundamental for purposes of equal protection analysis," United Bldg. & Constr. Trades Council v. Mayor & Council, 88 N.J. 317, 343 (1982), rev'd on other grounds, 465 U.S. 208, 104 S. Ct. 1020, 79 L. Ed.2d 249 (1984), the right not to be denied a public contract for invidious reasons, such as race, or religion, is a fundamental right.See footnote 3 Does the denial of public work because of union affiliation violate a similar fundamental right?
    Were we to resolve that question, we would have to determine (1) the nature of the right to choose one's bargaining representative, (2) whether a public-contract specification that does not by its terms prohibit the free choice of a bargaining representative may still impinge on that right, and (3) if the specification does impinge on that right, whether the public need for the restriction justifies its imposition.     
    Among the factors to be considered in assessing that public need would be the availability of other mechanisms to achieve the same substantive goal, such as a no-strike clause requiring all workers to work without interruption during the term of the project or an agreement to resolve jurisdictional disputes by reference to independent arbitrators. For example, the State might consider a bid specification that would require jurisdictional disputes to be mediated by an "impartial jurisdictional disputes board." See, e.g., Drywall Tapers & Pointers of Greater New York, Local 1974 v. Local 530 of

Operative Plasterers & Cement Masons Internat'l Assoc., 954 F.2d 69, 71 (2d Cir. 1992) (discussing both national Plan of Settlement of Jurisdictional Disputes in the Construction Industry and New York Plan for the Settlement of Jurisdictional Disputes). Finally, we would consider the extent to which we must defer to legislative action in defining the contours of a constitutional right. Hills Dev. Co. v. Township of Bernards, 103 N.J. 1 (1986).
    We are certain that the Legislature is as fully aware as we of the nature of the affected rights, the extent of any intrusion thereon, and the public need for such intrusion.

    To resolve this inquiry we must consider two questions: (1) did the Legislature delegate to the TPA the power to require project-labor agreements with a designated union, and (2) would the exercise of such power conflict with other statutory requirements?

    On the first point, appellants argue that the Legislature would not intend that an executive agency adopt so far-reaching a policy in the absence of express statutory authorization. Appellants support their argument by the separation-of-powers doctrine.
    "[W]ithin limits the legislature may delegate its authority to a government agency." Township of Mount Laurel v. Department of Pub. Advocate, 83 N.J. 522, 532 (1980); New Jersey State Chamber of Commerce v. New Jersey Election Law Enforcement Comm'n, 82 N.J. 57, 82-83 (1980). "[T]he Legislature may not vest unbridled or arbitrary power in [an] administrative agency," Ward v. Scott, 11 N.J. 117, 123 (1952), but "[a]s long as the discretion of administrative officers is `hemmed in by standards sufficiently definitive to guide its exercise,' the delegation of legislative powers is not unconstitutional." Township of Mount Laurel, supra, 83 N.J. at 532 (quoting Cammarata v. Essex County Park Comm'n, 26 N.J. 404, 410 (1958)); accord In re Egg Harbor Assocs., 94 N.J. 358, 372 (1983).
    Standards must accompany the delegation of power for three reasons:
        First, [they] prevent[] the Legislature from abdicating its political responsibility and prevent[] undemocratic, bureaucratic

institutions from wielding all-encompassing, uncontrollable government power. Second, limiting standards define the area in which the agency develops the experience and expertise that the legislature has neither the time nor resources to develop. With too broad a standard the agency stands in no better position than the legislature that created it. Third, and most important, standards facilitate judicial review of agency decisions, which guards against arbitrary and capricious governmental action. As long as the statutory standards achieve these purposes, such standards should be considered sufficiently definite to pass constitutional muster.

            [Township of Mount Laurel, supra,
             83 N.J. at 532-33.]

    Our courts have consistently sustained the delegation of legislative authority under broad and general statutory standards governing the manner in which administrative agencies must exercise the authority delegated. Thus, against constitutional attacks, we have upheld standards authorizing the Public Advocate to represent the "public interest" in administrative and court proceedings, Township of Mount Laurel, supra, 83 N.J. 522, and standards requiring the Department of Environmental Protection to "use its power to promote the health, safety, and welfare of the public." Egg Harbor Assocs., supra, 94 N.J. at 372. In other circumstances, we have given broad latitude to executive agencies to flesh out the contours of a statutory mission. See, e.g., GATX Terminals Corp. v. New Jersey Dep't of Envtl. Protection, 86 N.J. 46 (1981).

    Obviously, the mission of the TPA is to operate and maintain the most efficient roadways possible for the citizens of the State. N.J.S.A. 27:23-5. If in the construction and maintenance of that highway system the TPA deems a project-labor agreement necessary, the proposition that the requirement of such an agreement is within the TPA's mission is difficult to reject.
    The more difficult question is whether standards exist to guide the agency's discretion. For example, how far does the agency's discretion extend, and may that discretion be delegated to third parties? For example, in Utility Contractors Ass'n of New England, Inc. v. Department of Public Works, 565 N.E.2d 459 (Mass. App. Ct. 1991) (Central Artery), the consultant for the Department of Public Works actually negotiated the project-labor agreement with the building-trades council, an organization representing the building-trades unions. The Department of Public Works intended to require prospective contractors to execute such an agreement. Among the features of that agreement were provisions that:
    1. Dictated the scheduling of hours of work;
    2. Limited the contractor's right to select supervisors;
    3. Determined the circumstances under which employees might      be discharged;
    4. Precluded in effect the hiring of any employees not           members of the unions.

Brief for the Utility Contractors Association of New England, Inc. at 10-12, Central Artery, supra, 565 N.E.2d 459 (Nos. 90-P-921, 90-P-1062).
    Here the TPA did not use an independent agent to