Colt indeed had some labor issues in the mid to late '80s that seemingly affected Q/A. I am more familiar with the auto line than the revolvers, but I can attest that many of the new guns that came my way needed a little work to get running right. Cosmetically, they looked OK, but functionally they could not compete with Springfield, whom I believe was probably their biggest competitor at the time.
In the early '90s, I remember Colt making a concerted and very public effort to turn this perception around once the labor issues were resolved and new management was in place. This was around the time Colt changed the 1911 product line a little with the introduction of the Enhanced models as well as the budget 1991.