A few years ago, in the depths of the recession, Harvard was faced with the prospect of a massive, complicated project: renovating all 16 first-year dorms.

The project was long overdue, as the dorms, though livable, were in serious need of improvements to resolve structural and aesthetic problems. Given only the summer months during which no students inhabited the dorms, the time constraints were formidable.

"Harvard had to do the renovations on a very tight time schedule," says Lamont University Professor Emeritus John T. Dunlop, who mediated the agreement. "You can't have trouble on the job and have the freshman class camped out for a week."

At the same time, the bottom had fallen out of the Massachusetts construction business in the late 1980s with the crash of the real estate market. Construction workers, who had thrived with the real estate boom, were suddenly unemployed in massive numbers.

Harvard needed a way to meet both the construction unions' desire for a good job and the University's desire for fast, quality work at a decent price for an institution also feeling the pinch of the recession.

Enter the $80 million Project Labor Agreement of 1992. The agreement set a standard for the Yard renovations that satisfied the needs of both labor and management.

However, on projects outside the Yard, even just across Massachusetts Avenue, labor unions charge, Harvard has chosen not to follow the spirit of the agreement. To some extent, the University's essentially autonomous schools continue their policies of usually taking the lowest bid, union label or no, the unions charge.

Area unions accuse Harvard of neglecting its responsibility to the community by hiring substandard labor at cheap prices. Planning officials, on the other hand, say that they want to encourage savings and they don't want to interfere with various schools' hiring policies.

Across the University, a loose framework for hiring, justified by a pursuit for "efficiency," has irked these union workers, who thought they had turned the corner in negotiating jobs with the University.

Under the Project Labor Agreement, Harvard agreed that all work done on the dorms (and on Holyoke Center) would be done by union labor.

In return, Harvard asked for several concessions: The unions forfeit their right to strike or protest the work; union workers also give up the increase in wages usually paid on night shifts; and, among other concessions, workers take a 10 percent pay cut on all renovation work covered by the pact.

The agreement has few detractors on either side. "It brings jobs in with more certain savings," says Kristen S. Demong, head of Harvard Real Estate, which is managing the renovation of Holyoke Center. "It's nice to have balancing partnerships."

David P. Tamborella, a member of the Carpenters' Union Local 40, says the benefits go both ways. "Harvard gets a good deal. So do we, because it keeps us working. We have to keep working--times are tough right now."

The differences between labor and management stem, however, from one key phrase frequently repeated in the document: "work covered by this agreement."

To date, five additional renovation jobs and one construction job, the new Hillel building, have been tacked on to the agreement one by one. But no attempt has been made to expand the agreement University-wide to establish a set of stricter hiring standards.