Document 5.15.4: Excerpts from the U.S. Department of Labor memorandum regarding The Philadelphia Plan, June 27, 1969

The Philadelphia Plan was a priority of the Nixon Administration. The plan required contractors submitting bids for federal construction jobs to indicate how many minority workers were assigned to every division of a labor crew. After this approach was tried in several different cities, Philadelphia became the focus because several hundred million dollars of federal money was designated for public construction in that city and because black laborers were threatening strikes to protest racist hiring policies that excluded them.

Subject: Revised Philadelphia Plan for Compliance with Equal Employment Opportunity

Requirements of Executive Order 11246 for Federally-Involved Construction.

1. Purpose: The purpose of this Order is to implement the provisions of Executive Order 11246, and the rules and regulations issued pursuant thereto, requiring a program of equal employment opportunity by Federal contractors and subcontractors and Federally-assisted construction contractors and subcontractors.
2. Applicability: The requirements of this Order shall apply to all Federal and Federally-assisted construction contracts for projects the estimated total cost of which exceeds $500,000, in the Philadelphia area, including Bucks, Chester, Delaware, Montgomery and Philadelphia counties in Pennsylvania.
3. Policy: In order to promote the full realization of equal employment opportunity on Federally-assisted construction in the Philadelphia area on projects whose cost exceeds $500,000 unless the bidder submits an acceptable affirmative action program which shall include specific goals of minority manpower utilization, meeting the standards included in the invitation or other solicitation for bids, in trades utilizing the following classifications of employees:

Iron workers

Plumbers, pipefitters

Steamfitters

Sheet metal workers

Electrical workers

Roofers and water proofers

Elevator construction workers.

4. Findings: Enforcement of the nondiscrimination and affirmative action requirements of Executive Order 11246 has posed special problems in the construction trades.  Contractors and subcontractors must hire a new employee complement for each construction job and out of necessity or convenience they rely on the construction craft unions as their prime or sole source of their labor.  Collective bargaining agreements and/or established custom between construction contractors and subcontractors and unions frequently provide for, or result in, exclusive hiring halls; even where the collective bargaining agreement contains no such hiring hall provisions or the custom is not rigid, as a practical matter, most people working in these classifications are referred to the jobs by the unions.  Because of these hiring arrangements, referral by a union is a virtual necessity for obtaining employment in union construction projects, which constitute the bulk of commercial construction.

Because of the exclusionary practices of the labor organizations, there traditionally has been only a small number of Negroes employed in these seven trades. These exclusionary practices include: (1) failure to admit Negroes into membership and into apprenticeship programs.  At the end of 1967, less than one-half of one percent of the membership of the unions representing employees in these seven trades were Negro, although the population in the Philadelphia area during the past several decades included substantial numbers of Negroes.  As of April 1965, the Commission on Human Relations in Philadelphia found that unions in five trades (plumbers, steamfitters, electrical workers, sheet metal workers and roofers) were “discriminatory” in their admission practices.  In a report by the Philadelphia local AFL-CIO Human Relations Committee made public in 1964, virtually no Negro apprentices were found in any of the building trades classes….

Since the Philadelphia Plan was put into effect, some progress has been made.  Several groups of contractors and Local 543 of the International union of operating Engineers have developed an area program of affirmative action which has been approved by OFCC in lieu of other compliance procedures but subject to periodic evaluation.  The original Plan was suspended because of an Opinion by the Comptroller General that it violated the principles of competitive bidding.

Equal employment opportunity in these trades in the Philadelphia area is still far from a reality.  The unions in these trades still have only about 1.6 percent minority group membership and they continue to change in practices, including the granting of referral priorities to union members and to persons who have work experience under union contracts, which result in few Negroes being referred for employment.  We find, therefore, that special measures are required to provide equal employment opportunity in these seven trades.

In view of the foregoing and in order to implement the affirmative action obligations imposed by the equal employment opportunity clause in Executive Order 11246, and in order to assure that the requirements of this Order conform to the principles of competitive bidding, as construed by the Comptroller General of the United States, the Office of Federal Contract Compliance finds that it is necessary that this Order, requiring bidders to commit themselves to special goals of minority manpower utilization, be issued….

Source: Department of Labor memorandum reprinted in Congressional Record 112, Pt.2 (December 18, 1969): 39951