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OAH 11-3000-19280-2 |
STATE OF
OFFICE OF ADMINISTRATIVE HEARINGS
FOR THE DEPARTMENT OF TRANSPORTATION
|
In
the Matter of Valley Infrastructure d/b/a/ State Project No. 1017-12, State Contract S05063 |
FINDINGS OF FACT, CONCLUSIONS AND RECOMMENDATION |
The above-entitled matter came
on for an evidentiary hearing before Administrative Law Judge Barbara L.
Neilson on July 8, 9, 10, and 15, and
Michael A. Sindt, Assistant Attorney General, represented the Minnesota
Department of Transportation, Office of Construction and Innovative Contracting
(“Mn/DOT”). Patrick J. Lee-O’Halloran, Attorney at Law, Hammargren
& Meyer, P.A., represented Respondents Valley Infrastructure d/b/a Zumbro
River Constructors (“ZRC”) and Hansen Thorp Pellinen Olson, Inc. (“HTPO”).
STATEMENT OF ISSUES
The issues presented in this
case are whether Mn/DOT properly determined that the surveying work performed
by HTPO employees on the Trunk Highway 212 Project (State Project Number
1017-12) was subject to the Minnesota Prevailing Wage Act; and, if so, what, if
any back wages are owed to HTPO’s employees.
The Administrative
Law Judge concludes that, in an appropriate case, the PWA likely could
be interpreted to cover at least some portion of the work performed by
surveyors on projects funded in whole or part by state funds. However, the Administrative Law Judge finds
that the present case does not present an appropriate case for application of
the PWA and that the Respondents cannot properly be required to pay back wages
because (1) Mn/DOT and DOLI failed to properly assign a
wage rate to HTPO’s survey crews under Minn. R. 5200.1030, subp. 2a(C), and
5200.1040(F); (2) DOLI did not take
action to initiate rulemaking to define the surveyor classification in the
Master Job Classifications within 90 Days of the initial decisions by MN/DOT
and DOLI that surveyors were subject to the PWA; (3) Mn/DOT’s attempt to enforce the PWA with
respect to surveyors amounts to unauthorized rulemaking; and (4) Mn/DOT
failed to carry its burden to show by a preponderance of the evidence that Common
Laborer was the most similar trade or occupation. Accordingly, the Administrative Law Judge recommends that the
Commissioner withdraw Mn/DOT’s claim that back wages are owed to HTPO employees
and remit to Respondents any contract proceeds that have been withheld.
Based upon all of the testimony and exhibits, and the arguments of the parties, the Administrative Law Judge makes the following:
FINDINGS OF FACT
I. Background
A. Minnesota Prevailing Wage Statute and Rules
1.
The Minnesota Prevailing Wage Act (“PWA” or the
“Act”)[1] is
a minimum wage law that was adopted in 1973[2] and applies to certain state contracts that
are financed in whole or in part by state funds. The purpose of the PWA is to ensure that
“laborers, workers, and mechanics” who work on projects financed in whole or in
part by state funds are paid wages that are “comparable to wages paid for
similar work in the community as a whole.”[3] The PWA complements the federal Davis-Bacon
Act,[4]
which was first enacted in 1931. The Davis-Bacon
Act applies to federally-funded projects and has a somewhat different statutory
scheme. The U.S. Department of
Labor is responsible for enforcing the prevailing wage requirements imposed by
federal law under the Davis-Bacon Act.
2.
The PWA contains a specific provision relating to
contracts for the construction or maintenance of a highway based on bids to
which the state is a party.[5]
The Act specifies that a "laborer or mechanic" employed by a
contractor, subcontractor, agent, or other person doing or contracting to do
all or part of the work under such a contract "must be paid at least the
prevailing wage rate in the same or most similar trade or occupation in the
area."[6]
3.
The Minnesota Department of Labor and Industry
("DOLI") has authority to adopt administrative rules relating to the
PWA.[7] The Minnesota Department of Transportation
("Mn/DOT”) does not have rulemaking authority in connection with the PWA.[8]
4.
Under the provisions of the PWA relating to highway
contracts, DOLI is responsible for defining classes of laborers and mechanics; determining
the hours of labor and wage rates prevailing in all areas of the state for all
classes of labor and mechanics commonly employed in highway construction work;
and certifying the prevailing hours of labor, the prevailing wage rate, and the
hourly basic rate of pay for all classes of laborers and mechanics at least
once a year.[9]
5.
The Commissioner of Mn/DOT is authorized by the PWA
to "require adherence" to Minn. Stat. § 177.44, and thus has a role
in enforcing the provisions of the Act.
Under the statute, Mn/DOT may demand that contractors and subcontractors
furnish copies of payrolls and may “examine all records relating to hours of
work and the wages paid laborers and mechanics on work to which this section
applies."[10]
6.
The DOLI rules define the phrase “laborer or mechanic"
to mean “a worker in a construction industry labor class identified in or
pursuant to part 5200.1100.”[11] The rules promulgated under the PWA by the
DOLI define the phrase "work under the contract" to mean "all
construction activities associated with the public works project."[12] The rules adopted by the U.S. Department of
Labor under the Davis-Bacon Act define “laborer or mechanic” to include “at
least those workers whose duties are manual or physical in nature (including
those workers who use tools or who are performing the work of a trade), as
distinguished from mental or managerial” and indicates that the term “does not
apply to workers whose duties are primarily administrative, executive, or
clerical, rather than manual.”[13]
7.
Between 1997 and early 2009, the Master Job
Classifications set forth in the DOLI rules identified nine code numbers under
the overall classification of laborers:
Code 101 – Laborer, common (general labor work); Code 102 - Labor,
skilled (assisting skilled craft journeyman); Code 103 - Laborer, Landscaping
(gardener, sod layer and nursery operator); Code 104 - Flag person; Code 105 -
Watch person; Code 106 - Blaster; Code 107 - Pipe layer (water, sewer and gas);
Code 108 - Tunnel miner; and Code 109 - Underground and open ditch laborer
(eight feet below starting grade level).[14] Other classifications in the rules applied to
equipment operators, truck drivers, and special crafts such as carpenters,
ironworkers, and painters.[15]
8.
At all times relevant to this matter, the Master
Job Classifications set forth in the DOLI rules relating to the PWA did not
identify survey field technicians as a labor classification to be used by
contractors in documenting classes of labor on prevailing wage projects.[16]
9.
The DOLI rules set forth the following process to
be followed in instances in which work on a prevailing wage project is
performed by a class of labor not named in the Master Job classifications:
If work is performed by a class of labor not
defined by part 5200.1100, Master Job Classifications, the contracting agency
shall assign a wage rate and the commissioner of labor and industry shall
review and certify the assigned wage rate based on the most similar trade or
occupation from the area wage determination.
Within 90 days, the Commissioner of Labor and Industry must initiate the
rulemaking procedure so that the classification will be defined in the Master
Job Classifications in Part 5200.1100.[17]
10.
The DOLI rules also specify that each class of
labor that is established must be based upon “the particular nature of the work
performed with consideration given to those trades, occupations, skills, or
work generally considered within the construction industry as constituting
distinct classes of labor.” In addition,
the rule specifies that DOLI must consider “work classifications contained in
collective bargaining agreements, apprenticeship agreements on file with the
department, the United States Department of Labor Dictionary of Occupational
Titles, and customs and usage applicable to the construction industry.”[18]
11.
The
Dictionary of Occupational Titles developed by the U.S. Department of Labor defines “Surveyor Assistant,
Instruments (profess. & kin.)” as follows:
Obtains data
pertaining to angles, elevations, points, and contours used for construction,
map making, mining, or other purposes, using alidade, level, transit, plane
table, Theodolite, electronic distance measuring equipment, and other surveying
instruments. Compiles notes, sketches,
and records of data obtained and work performed. Directs work of subordinate members of survey
team. Performs other duties relating to
surveying work as directed by CHIEF OF PARTY (profess. & kin.).[19]
12.
The
Dictionary of Occupational Titles does not define the term “laborer.” It defines “Construction Worker II
(construction)” as follows:
Performs any combination of following tasks,
such as erecting, repairing, and wrecking buildings and bridges; installing
waterworks, locks, and dams; grading and maintaining railroad right-of-ways and
laying ties and rails; and widening, deepening, and improving rivers, canals,
and harbors, requiring little or no
independent judgment: Digs, spreads, and levels dirt and gravel,
using pick and shovel. Lifts,
carries, and holds building materials, tools, and supplies. Cleans tools, equipment, materials, and work
areas. Mixes, pours, and spreads
concrete, asphalt, gravel, and other materials, using handtools. Joins, wraps, and seals sections of
pipe. Performs variety of routine,
nonmachine tasks, such as removing forms from set concrete, filling expansion
joints with asphalt, placing culvert sections in trench, assembling sections of
dredge pipelines, removing, wallpaper, and laying railroad track. Many of these jobs are not full time; project
size and organization of work determine whether workers spend their time on one
job or transfer from task to task as project progresses to completion. Some workers habitually work in one branch of
industry, whereas others transfer according to availability of work or on
seasonal basis. Work is usually
performed with other workers.
The definition of
Construction Worker II goes on to list a number of designations related to the
specific work such workers may perform.
The listed designations include “Grader (construction)” and “Grade
Tamper (construction).” None of the
listed designations refer to “surveyor” or to survey work in any way.[20]
13.
During the time period relevant to this case, Erik
Oelker was the lead prevailing wage investigator at DOLI. Mr. Oelker was responsible for providing
technical assistance to stakeholders, participating in the wage data survey
process, and reviewing and certifying prevailing wage rates under Minn. R.
5200.1030, subp. 2a(C).[21] In February of 2009, Mr. Oelker suffered a
traumatic brain injury. As of the
hearing in this matter, he was unable to work and was on an extended medical
leave. Mr. Oelker did not testify at the
hearing in this matter.[22]
14.
During the time period relevant to this proceeding,
there was not a formal process followed at DOLI to carry out its obligation
under Minn. R. 5200.1030, subp. 2a(C), to “review and certify” wage rates that
were assigned by Mn/DOT as the contracting agency. It was typical during that time for Mr.
Oelker and Mn/DOT representatives to engage in informal discussions regarding
prevailing wage issues, and for
nothing to be issued in writing by DOLI stating that a wage rate assigned by Mn/DOT
was appropriate based on the most similar trade or occupation from the area wage
determination.[23]
B. Surveying Work and Prevailing Wage
Requirements
15.
The U.S. Department of Labor has long taken the
position that “preliminary survey work, such as the preparation of boundary
surveys and topographical maps, is not construction work covered by the
Davis-Bacon Act, especially when performed under a separate contract. Thus, the Davis-Bacon prevailing wage
requirements generally would not apply to such survey crew work.”[24] The only exception to this interpretation has
existed with respect to certain projects that receive federal assistance from
the U.S. Department of Housing and Urban Development under statutory provisions
that are broader in scope.[25] Under the U.S. Department of Labor’s
longstanding interpretation, surveying performed immediately prior to and
during actual construction, in direct support of construction crews, is covered
by the Davis-Bacon requirements for laborers and mechanics. However, “[t]he determination of whether certain
members of survey crews are laborers or mechanics [within the meaning of the
Davis-Bacon Act] is a question of fact [which] must take into account the
actual duties performed. As a general
matter, an instrumentman or transitman, rodman, chainman, party chief, etc. are
not considered laborers or mechanics. However, a crew member who primarily does
manual work, for example, clearing brush, is a laborer and is covered for the
time so spent."[26]
16.
The above U.S. Department of Labor interpretation
stems in part from the definition of the term "laborer or mechanic"
contained in federal rules. In relevant
part, those rules define laborers and mechanics as follows:
The term laborer or mechanic includes at least
those workers whose duties are manual or physical in nature (including those
workers who use tools or who are performing the work of a trade), as
distinguished from mental or managerial. . . .
The term does not apply to workers whose duties are primarily
administrative, executive, or clerical, rather than manual. Persons employed in a bona fide executive,
administrative, or professional capacity . . . are not deemed to be laborers or
mechanics.[27]
To be considered
exempt executive, administrative, or professional employees, the U.S.
Department of Labor rules generally require that employees meet certain minimum
tests related to their primary job duties and, in most cases, be paid on a
salary basis at not less than minimum amounts.
The exemption does not apply to manual laborers or other blue-collar
workers who perform work involving repetitive operations with their hands,
physical skill, and energy.[28]
17.
Prior to the late 1990’s, land surveying work on
Mn/DOT highway projects either was performed by Mn/DOT employees or by
surveying crews that were hired by Mn/DOT under a separate contract.[29] Prevailing wages were not paid to Mn/DOT
employees performing surveying work because State employees are not subject to
the requirements of the PWA.[30] There is no evidence that survey crews hired
by Mn/DOT under separate contracts were required to be paid prevailing wages.
18.
Beginning in the late 1990’s, Mn/DOT began to
examine the concept of “contractor construction staking,” i.e., having the
prime contractor hire its own survey crew to do surveying work on construction
projects.[31] On July 17, 1998, David Ekern, Director and
Assistant Chief Engineer of Engineering Services at Mn/DOT, issued Technical Memorandum
No. 98-18-RWS-01 (the “1998 Technical Memorandum”) relating to construction
surveying. In essence, the memorandum
allowed general contractors to hire private survey companies as subcontractors
and pay for them under the prime contract.
The memorandum indicated that, “[i]n order to supplement Mn/DOT’s work
force capabilities in the area of construction surveying, private contractor
construction surveying may be authorized in new Mn/DOT construction
contracts.” For this reason, the
memorandum stated that standard specifications for construction surveying would
be added to construction contracts requiring this type of construction project
work. Among other things, the memorandum
indicated that contractors “shall provide material, labor, equipment, and
documentation necessary for construction surveying and for producing the
as-built Plan,” and shall “retain a Professional Land Surveyor or Professional
Engineer, licensed in the State of
19.
On
20.
Mn/DOT was unable to locate a technical memorandum
that was in effect between the July 2003 expiration date of the 1998 Technical
Memorandum and the
21.
Both the 1998 Technical Memorandum and the 2005
Technical Memorandum discussed the basis of payment by Mn/DOT of construction
surveyors, the payment schedule, and payment for extra work. However, neither Memorandum stated that
survey crews would have to be paid prevailing wages under the PWA nor discussed
any classification that would be applicable to field survey technicians or
field survey members.[36]
22.
On or about May 13, 2005, Mn/DOT and Zumbro
River Constructors (“ZRC”) (a joint venture of Fluor Enterprises, Ames
Construction, and Edward Kraemer & Sons)[37] entered into a
design-build contract in the amount of $237,893,000 for the design and construction
of an 11.75-mile trunk highway within the city limits of Eden Prairie,
Chanhassen, Chaska, and Carver in Hennepin County and Carver County (“the
Project” or “the TH 212 Project”). The
Project included grading, surfacing, noise berms, noise walls, ponds, signals,
lighting, signing, and bridges.[38]
23.
Prior to submitting its price proposal to Mn/DOT
for the TH 212 Project, ZRC solicited bids for the surveying work on the
Project. Hansen Thorp Pellinen Olson,
Inc. (“HTPO”) expressed interest in the project.[39] HTPO is a firm that provides civil engineering,
land surveying, and landscape architecture services. HTPO
carries professional liability insurance and is taxed as a personal services
corporation. The personal services corporation tax rate applies to corporations
providing professional services, such as accountants, attorneys, engineers, and
architects.[40] HTPO’s President, Laurie Johnson, has
been a licensed professional engineer since 1997.[41]
Daniel Thorp, Vice President of HTPO, has been a Registered Land
Surveyor since 1981 and manages HTPO’s surveying activities in the field and in
the office.[42] HTPO does not employ any individuals who are
classified or called “laborers” or “mechanics.”[43]
24.
During pre-bid meetings, Mn/DOT did not discuss
with ZRC whether land surveyors used on the Project would be subject to
prevailing wage requirements. Neither
the price proposal that ZRC submitted to Mn/DOT nor the proposal that HTPO
submitted to ZRC assumed that prevailing wages would be paid to land surveyors.[44]
25.
Scott Risley,
a licensed professional engineer, was the Project Manager for ZRC on the
Project and was responsible for the overall execution and management of the TH
212 Project. Mr. Risley put together
ZRC’s bid and developed its price proposal for the Project. Mr. Risley had worked for Fluor Enterprises
on highway construction projects for almost 17 years. He was familiar with the practice of land
surveying on highway construction projects as well as prevailing wage
requirements in federally-funded projects and projects in other states. Based on his experience, Mr. Risley did not
expect while negotiating the ZRC contract that prevailing wages would be
required for land surveyors working on the TH 212 Project.[45]
26.
Prior to working on the TH 212 Project, HTPO had
performed approximately 50% of its work on publicly-owned projects and the
other 50% on privately-owned projects.[46] HTPO
had worked on many projects for which the contracts contained language relating
to state PWA and federal DBA requirements.[47] HTPO’s public work had included
several projects for the State of
27. Prior to this Project, HTPO had never been required to pay field survey crews prevailing wages for any work performed on other public projects or been the subject of a prevailing wage investigation.[49] Ms. Johnson and Mr. Thorp believed that individuals working on survey field crews were not “laborers” or “mechanics” within the meaning of the PWA and that the PWA did not apply to survey field crews.[50] They were not aware of any previous attempts by Mn/DOT to enforce the PWA as to survey field crews.[51]
28.
After ZRC was awarded the contract with Mn/DOT on
the TH 212 Project in March 2005, ZRC began to execute its subcontracts with
selected subcontractors. HTPO was
selected by ZRC to perform the surveying work related to roadway construction,
grading, and paving on the Project. ZRC
selected another firm, EVS, to provide survey work relating to
structures (bridges, culverts, etc.) on the Project.[52] Subcontractors were required to comply with
the terms of ZRC’s prime contract with Mn/DOT.
ZRC provided HTPO with a copy of the prime contract.[53]
29.
In May 2005, ZRC and HTPO executed a subcontract in
the amount of $2,251,590.[54] The subcontract between ZRC and HTPO
incorporated the terms of the prime contract between ZRC and Mn/DOT, as did the
subcontract between ZRC and EVS.[55] The heading on the first page of the
subcontract indicated that it was for professional services.[56] Under the subcontract, HTPO was required to
provide grade surveying and staking for multiple aspects of the Project,
including ramps and loops, noise walls, ponds, sanitary and storm sewer,
lighting, and guardrails. The subcontract
was effective on
30.
Ms.
Johnson of HTPO reviewed the proposed subcontract language between HTPO and ZRC
before she signed the contract on behalf of HTPO.[58]
She noticed that the prime contract and
several exhibits were incorporated into the subcontract and reviewed all of
those materials. She specifically
reviewed the Master Job Classifications and the wages included in the prime contract
and noticed that there were no wages included for survey field crews.[59]
She also reviewed the statutes and rules that were referenced in the contract,
including the PWA and DOLI’s rules under the PWA.[60]
31.
Exhibit F-4 attached to the prime contract stated,
“This project is covered by
32.
The prime
contract listed the Master Job Classifications that were set forth in the
DOLI rules in effect at the time and provided contractors with codes to use in
classifying work. The listing of job
classifications in the prime contract included more than 140 classes of work.[63] The total hourly wage rate (the basic rate
plus the fringe rate) for Code 101 (Laborer, Common – general labor work) under
the contract was $31.85 for the period of
33.
There was no language in the prime contract
specifically relating to surveyors, and no job classification was listed for
field survey technicians.[66]
34.
The prime contract included the following Prevailing
Wage Statement dated
A recent unpublished decision of
the Minnesota Court of Appeals, affirms the authority of the Minnesota
Commissioner of Transportation to enforce the Minnesota Prevailing Wage Law on
The Department of Transportation
will enforce the Minnesota Prevailing Wage Law in a manner consistent with the
Court of Appeal’s decision notwithstanding any prior notices on this
subject. A copy of the Court of Appeal’s
decision is available to anyone who is interested in reviewing it. Please call Charles Groshens, Labor
Compliance Unit at (651) 297-5716 to receive a copy.[67]
35.
Work on the design of the TH 212 Project commenced
immediately after the Mn/DOT-ZRC contract was executed in March 2005.[68] HTPO was part of the design team.[69]
36.
The actual on-site construction on the Project did
not begin until August 2005.[70]
37.
The land
survey work on the Project began during the summer of 2005 and was completed by
September of 2008.[71]
38.
Construction of the Project was completed in November of 2008, when ZRC
received its conditional final acceptance from Mn/DOT.[72]
39.
Based
upon HTPO’s certified payrolls, HTPO’s work on the Project commenced during the
week ending
III.
Mn/DOT Prevailing Wage Investigation
40.
Mn/DOT
did not raise any issue regarding prevailing wages for HTPO’s land survey field
crews until more than a year after work had commenced on the Project.[74]
41.
In November 2006, while investigating the
application of the PWA to surveyors on the ROC 52 project in
42.
The ROC
52 job involved ZRC as the general contractor and a different surveying
subcontractor, Yaggy Colby. Mn/DOT’s investigation of the
ROC 52 project began in May 2006, in response to a complaint from a Yaggy Colby
employee. Mn/DOT ultimately concluded that Yaggy Colby surveyors were subject to
the PWA and that back wages were owing.
Mn/DOT determined that the Code 101 Common Laborer classification was
the most similar to the work performed by the Yaggy Colby surveyors. In calculating the back wages it contended
were owing, Mn/DOT did not require all of the on-site land surveying activities
that Yaggy Colby performed to be subject to the PWA.[76] Mn/DOT excluded the portion of the work
performed by Yaggy Colby surveyors that was related to design rather than
construction based on its determination that the design work was not work under
the contract.[77] In addition, Mn/DOT did not require the “as
built” time spent by Yaggy Colby surveyors to be covered by the PWA.[78] Although Yaggy Colby never agreed that its surveyors
were subject to the PWA, it ultimately reached an agreement with Mn/DOT in approximately
September of 2007 to pay survey crew members approximately $30,000 in
additional wages in order to avoid legal expenses and resolve the dispute with
Mn/DOT.[79]
43.
As part of his investigation of the TH 212 Project,
Mr. Richards reviewed the prime contract and HTPO’s payroll records.[80] Mr. Richards visited the Project site two or
three times for at least one hour each time.
During those visits, Mr. Richards looked over the entire Project and did
not focus solely on HTPO employees. He
did not interview HTPO employees working on the site.[81]
44.
Although
Mr. Richards testified that he also reviewed the “Book of Occupational Titles”
during his investigation and determined that the definitions of surveyor and
laborer were similar,[82]
this testimony is not credited because Mn/DOT admitted in response to Requests
for Admissions served by ZRC and HTPO that “Mn/DOT did not consult the United
States Department of Labor’s Dictionary of Occupational Titles in connection
with the Investigation, prior to issuing Robert Richards’ letter dated June 19,
2007” or “prior to issuing Thomas Ravn’s letter dated August 15, 2007.”[83]
45.
Since surveyors did not have their own
classification in the Master Job Classifications list set forth in the DOLI
rules at the time, Mr. Richards attempted to determine which of the existing
classifications were the most same or similar trade or occupation. To
Mr. Richards’ knowledge, the only classes of labor identified on the Master Job
Classification list that performed surveying tasks in conjunction with their
classification were laborers, carpenters, cement finishers, ironworkers, and
pipe fitters. Mr. Richards met with
union representatives and reviewed apprenticeship programs associated with four
of these five trades (laborers, carpenters, cement finishers, and ironworkers).[84]
46.
Mr.
Richards mistakenly believed that the apprenticeship agreement for the laborers
union required that individuals receive 160 hours of training in field
surveying,[85] rather
than merely offering 40 hours of elective training in “instruments” and 40
hours of elective training in “line and grade.”
47.
Mr.
Richards has never worked as a land surveyor or operated a Total Station or
other equipment used by surveyors.[86] He did not consult with any land surveying
professionals in reaching his determination that Common Laborer was the same or
most similar trade or occupation to the survey crew.[87]
He admitted that he was unfamiliar with
the Total Station used by surveyors at the time.[88] Mr. Richards had some experience working as a
laborer in the construction industry between 1965 and 1973.[89] While Mr. Richards believes that Common Laborers perform
tasks that are the same or similar to surveying (holding a rod and a tape
measure; running a transit; clearing brush; putting in grade stakes; blue
topping; and staking for water mains, bridges, concrete, bituminous, sewer
lines, berms, and noise walls),[90] he
acknowledged at the hearing that he
was not qualified to testify about the nature of the field surveying work
performed by Common Laborers.[91]
48.
During the investigation, Mr. Richards contacted
Erik Oelker at DOLI. Mr. Richards told
Mr. Oelker that he had reviewed the apprenticeship agreements for the four
trades and had determined that the apprenticeship program that was created by
DOLI for laborers included “required” training on surveying work. Mr. Richards informed Mr. Oelker that he
believed that the 101 Common Laborer classification on the existing Master Job
Classification list was the most similar classification with respect to the
duties performed by the surveyors on the TH 212 job. Mr. Oelker told Mr. Richards that he
concurred.[92] Mr. Richards did not have any contact with
anyone else at DOLI regarding this issue.[93]
49.
Neither
Erik Oelker nor anyone else at DOLI ever certified or confirmed in writing that DOLI
believed that Common Laborer was the most same or similar trade or occupation
to survey field crews.[94] Mr. Richards generally did not receive
written confirmation from Mr. Oelker during this time frame.[95]
50.
After reviewing the payroll records, Mr. Richards
prepared an analysis of back wages owed to the HTPO workers on the
Project. Mr. Richards’ initial calculations of back wages were based solely on
field survey employees and did not encompass office employees. It was Mr. Richards’ understanding that HTPO employees involved in design work
were not included in the certified payrolls submitted for field employees.[96] He did not perform any independent
investigation to determine the actual tasks that HTPO’s employees performed
with respect to the certified payrolls that were submitted for HTPO’s field
activities[97]
51.
Because Mr. Richards did not consider travel
between HTPO’s main office and the work site to be “work under the contract” subject to the requirements of the
PWA, he factored out estimated travel time for each worker of seven minutes per
day.[98] Mr. Richards’ calculation of travel time credit was based on an estimate
by one of the HTPO crew chiefs of the amount of time it would take to travel from
HTPO’s office to the nearest point of the Project site.[99]
52.
In calculating the back wages he believed were
owing under the PWA, Mr. Richards used the Common Laborer wage rate of $31.85
(basic rate of $23.59 plus fringe benefits of $8.26). He concluded that HTPO owed $207,671 in total
back wages.[100] He applied the same wage rate to all of
HTPO’s employees regardless of work performed.[101] Mr. Richards believed that the total he
calculated did not include time spent on design work.[102] However, some design-related work was
included in the certified payrolls provided by HTPO, such as a boundary topographical
survey conducted toward the end of the project, and monitoring for the
settlement plates and the walls.[103]
53.
By the
time formal letters were written in January of 2007 concerning the prevailing
wage issue, approximately 70% of HTPO’s work on the Project had been completed.[104]
54.
In a letter dated January 3, 2007, almost a year
and a half into construction of the TH 212 Project, ZRC informed HTPO President
Laurie Johnson that Mn/DOT had performed payroll audits and had taken exception
to the certified payrolls provided by HTPO for the TH 212 Project because HTPO
had been paying its workers every two weeks instead of every week as directed
by federal contract provisions. ZRC
requested that HTPO respond to the issue by
55.
By letter dated
56.
HTPO responded on
57.
ZRC provided a copy of HTPO’s responsive letter to Jon
Chiglo of Mn/DOT on
58.
On
59.
On
60.
On
61.
In a letter dated
62.
By letter to Mr. Richards dated
63.
Another
firm, SRF, was part of the design team on the Project and performed surveying
on the Project using field crews.
Although some of the work performed by SRF was the same as the work
HTPO’s field crews performed, Mn/DOT did not require SRF to pay prevailing
wages to its field crews.[118]
The record does not contain any evidence
explaining why SRF was not required to pay prevailing wages.
64.
Mn/DOT
also did not require that individuals employed by subcontractors of ZRC who
conducted quality control and quality assurance testing of soils and materials
used in the TH 212 Project be paid prevailing
wages for their work.[119]
65.
ZRC had a $200,000 allowance in its bid for
additional landscaping at the discretion of the cities affected by the Project.[120] In a letter to Scott Risely at ZRC dated
IV. HTPO’s Surveying Duties on the Project
66.
Geodetic
surveying takes the shape and curvature of the earth into account to obtain an
accurate location on the earth’s surface.[124] Licensed land surveyors locate objects on,
above, and below the earth’s surface and map them, locate boundaries, set
monuments and corners, and create grading plans.[125]
67.
Land surveying is a regulated profession, and
land surveyors can be subject to professional liability for errors they make in
their work. If a land surveyor’s work
does not satisfy the required standard of care, it may be necessary to remove
the construction, re-stake, and rebuild.
Such mistakes may cause delay in the project and corrections may be
costly. Moreover, a land surveying error
at one point in the project can have consequences throughout the construction
of the project. For example, if a
surveyor sets one elevation wrong and the error is not caught, the mistake can
affect the elevations at which the entire project is constructed.[126]
68.
Survey crews on highway construction projects
generally first establish and verify control networks, add additional control
points if necessary, determine which trees and shrubs have to be removed and
mark them for clearing and grubbing, and slope-stake the job to guide the rough
grading of the project.[127] As the project progresses, survey crews
provide “blue top” stakes to guide the more detailed grading of the project,
provide paving hubs/lines to guide concrete or bituminous paving, and stake for
sewer, gutter, retaining walls, and storm sewers, as appropriate. Throughout the course of a project, survey
crews check and verify existing conditions, and it is not uncommon for them to
“design on the fly in the field” in order to make elements fit.[128] In addition, surveyors on highway projects
may stake working points for
bridges to guide construction bridges; take measurements to confirm that a
project was built within specifications and that the correct amount was paid to
the contractor based upon pay quantities (how much concrete was installed and
how much dirt was moved, etc); take “as-built” measurements to determine if the
end result was different than the original plan and reflect those changes in
the record; mark final right-of-ways; and add additional control points for
future use.[129]
69.
Surveying done in support of construction projects
is no different than other surveying. The
same activities, depending on why and when they are being performed, could
qualify as design, construction, or right-of-way surveying.[130]
70.
In
conducting its surveying work on the Project, HTPO personnel typically worked
in two-person crews composed of a “crew chief” and a “survey assistant.” The
crew chief was in charge of making sure the work was done correctly, and the
survey assistant performed different tasks depending on what the crew chief
felt was necessary. Typically, the survey assistant operated the
instrument and the data collector, and the crew chief (situated at the other
end where he could see what was going on) moved the hub, set points, drove lath
into the ground, marked lath, and directed the project. Accuracy and precision are important in this work.[131] HTPO
does not call any of its employees a “rodman” and none of its employees are
limited to holding a level rod or the “zero end” of a tape measure.[132]
71.
Two
HTPO employees provided a demonstration during the hearing to show how an HTPO
survey field crew would set up and operate its equipment to lay out and stake
for the construction of a retaining wall based on two known points. During the demonstration, they employed the
same techniques and equipment that HTPO crews used for tasks performed on the
212 Project (a Total Station, a backsight, and a data collector).[133] They demonstrated how to establish “control,”
i.e., where they are positioned on earth in relation to the project plans;[134]
how to use a total station and a backsight for reference,[135]
and how to level the equipment to ensure that it could take precise and
accurate measurements.[136]
They also showed how a prism target similar
to a backsight is used to determine distance from a total station;[137]
how a data collector is used to calculate points and elevations;[138]
how an offset is set up from a known point;[139]
and how staking would be done and lath would be marked.[140] The demonstration accurately reflected how
work was done by HTPO surveyors on the TH 212 Project.[141]
72.
Mr. Thorp, Kenneth Whitehorn, and Ted Anderson were
the only licensed surveyors working on the Project for HTPO.[142]
73.
Entry
level people hired by HTPO to perform survey work do not take any course of
study before they go out on the project.
They receive on-going training from HTPO as soon as they start working
in the field.[143] As employees gain knowledge and experience,
they work their way up to the crew chief position.[144]
The work performed by crew chiefs involved
a significant degree of mental work.[145]
74.
The primary equipment used by HTPO crews were GPS
units that were accurate in
precision to about the size of one golf ball;[146]
standard and robotic Total Stations;[147] backsights;[148] prisms;[149]
optical automatic levels;[150]
and data collectors.[151] The equipment is used by surveyors to
orient themselves to previously-established control points and identify their
point in space, both horizontally and at the proper elevation. As part of their work on various tasks, HTPO’s survey
crews marked lath using a particular nomenclature to communicate
precise information to the construction crews about how to use the plotted
survey information to construct the Project at the appropriate horizontal
location and elevation.[152]
75.
Decades ago, surveyors would operate in 3- or 4-person crews and one or two of the
crew members would perform only manual labor.
However, technological advances have changed the way surveying is done. None of the HTPO field crew members working on the
Project performed primarily manual work, such as swinging a hammer, clearing
brush, or pounding stakes. There was no field crew member whose job was
only to sharpen stakes or pound the lath.
In fact, HTPO’s stakes come pre-sharpened, and crews spent no more than
3% of their time actually pounding stakes into the ground.[153]
76.
HTPO’s surveying work on the TH 212 Project was
organized according to phase codes that were established in early August of
2005.[154] In order to track the time spent on different
phases of the Project, HTPO employees reported their time using the following
codes, depending upon the particular survey tasks that they were performing:
a. Slope Stakes: This is a method used to determine where the existing ground meets the proposed slope for the project in order to mark off the start of grading on the project. HTPO’s two-person crews performed the slope staking for the first mile of the TH 212 Project using a standard Total Station, a backsight, and a data collector.[155]
b. Blue Top Sand: After most of the sand is placed by others on the project, HTPO determined the grade where the sand was supposed to be and placed a stake called a “blue top” so that the sand could be finished to that level. HTPO performed this work using a GPS unit by turning an angle, measuring, driving the stake, and then measuring the elevation of the stake and adjusting it up or down to the proper elevation.[156]
c. Blue Top Base: The process used to blue top base is similar to that used to blue top sand, but the work is done at a higher elevation because the base is placed in the layer above the sand.[157]
d. Concrete Stakes: To guide other contractors in trimming the rock and pouring the concrete to the right elevation, HTPO computed an extension grade between two ends of the proposed concrete by extending one end out 20 feet and the other out 7 feet. HTPO set stakes and marked lath with information for the concrete subcontractor. A robotic Total Station was typically used for this work. The concrete subcontractor thereafter ran a string line from the stakes set by HTPO.[158]
e. Walls: HTPO crews used a Total Station and a backsight to set 2-4 control points for retaining walls and sound walls on the Project and marked lath with information in order to guide other subcontractors who were building the walls. The information provided by HTPO included what the cut or fill would be to the proposed wall location vertically.[159]
f. Ponds: HTPO survey crews used GPS units to compute and set stakes for locations for various contours of storm water ponds that were then built by other subcontractors on the Project.[160]
g. Intelligent Transportation Systems (ITS): Using a GPS unit, HTPO marked and set lath at locations where wires would be buried for ITS systems or where loops for the traffic would be located.[161]
h. Signs: HTPO used GPS units to stake speed limit and other signs to be located along the freeway, usually by marking a line and a sign number on the already-poured concrete. Subcontractors installing the sign would measure off the right distance and set their signs accordingly.[162]
i. Guardrail: HTPO computed the location of guardrails and used a GPS to mark the beginning and end of the guardrails on the concrete paving. The subcontractors installing the guardrails measured from HTPO’s mark on the pavement to determine the actual location where the guardrail should be placed.[163]
j. Utilities: HTPO used GPS, standard Total Stations, and robotic Total Stations to locate the center of manholes at the bottom of the holes for storm sewer and sanitary sewer, the center of the openings of catch basins, the grade for all of the pipes coming in, and the percent of grades for the pipe going out. They marked lath with this information for other subcontractors to use in their construction. The utility work required a higher degree of vertical precision and a lesser degree of horizontal precision.[164]
k. Control: HTPO used and verified some control points set by SRF and Mn/DOT and also established its own preliminary control points throughout the entire Project using various equipment, including a digital level.[165]
l. Fence: HTPO located the anchor points of the fences along the side of the freeway and some points on line in the middle if it was a long straight fence. To do this work, HTPO computed coordinates in the office for the location of the fence, compared it to the boundary survey for the fence to ensure that the coordinates matched the land Mn/DOT had. In the field, HTPO measured the right-of-way stakes to make sure the fence was inside the right-of-way and, after verifying the right-of-way, laid out the fence. To perform this work, HTPO used GPS units if tree cover was not in the way, and put up a lath setting the actual corners of the fence.[166]
m. Light Poles: HTPO determined the location of the large concrete bases for the overhead light poles and street lights on the Project using GPS and provided subcontractors building them with an offset and a grade for the top of the concrete base.[167]
n. As-builts: Surveying for “as-builts” involves measuring and recording the location of items after construction is completed. On the TH 212 Project, most of HTPO’s work for as-builts involved having the utility locator person go out and mark where the ITS lines were actually set, and then sending out an HTPO crew to actually measure the coordinates of the location.[168]
o. Restakes: If HTPO’s
stakes in connection with any of the above phases were knocked out by others
working on the project, HTPO crews would repeat the entire staking process using
the same equipment described above or, occasionally, merely reset the lath with
the grade on it.[169]
The phase codes used by HTPO for the Project also included Office Computation, Administration, and Expense codes which did not involve field work done by field crews.[170] Although a code was assigned for Striping, HTPO did not end up doing any striping on the Project.[171] HTPO’s field work on the Project also included locating leafy spurge (a noxious weed) on the Project and putting in lath using GPS units; monitoring retaining walls by setting up and measuring control points periodically to verify that they were not moving; and monitoring the elevation of plates for settlement to ensure the ground underneath was compressed. Equipment used for monitoring included the Total Station and an automatic level.[172]
V. Training
of and Nature of Work Performed by Common Laborers, Landscape Laborers and
Surveyors
77.
The
Laborers District Council of Minnesota and
78.
The
collective bargaining agreements for the highway heavy and commercial building construction
industry in
79.
In addition to the required training courses,
laborers may choose from several elective courses offered at the laborers’
training center. The two courses
relating to setting construction grade that are offered at the center are both electives. The “instruments” course (40 hours in length)
is introductory in nature and familiarizes laborers with construction
mathematics and the types of instruments involved in setting grade and hub
points. The “line and grade” course
(also 40 hours in length) is somewhat more advanced and teaches skills
specifically related to grading on highway heavy projects. Each of these classes involves some classroom training and some practical
training.[176] All laborers, including Landscape Laborers and highway heavy laborers,
would have access to this training. More
than 500 laborers have received training in one or both of these classes since
2000.[177] However, it would be possible for a laborer
to complete his or her training and never take either of these classes.[178]
80.
There is
no evidence regarding what specific instruments laborers are trained to operate
if they choose to take the “instruments” or “line and grade” classes, what
tasks they are trained to perform, or what grade they must receive to be
considered to have successfully completed these classes.[179] In addition, there is no evidence that the State Board of
Architecture, Engineering, Land Surveying, Landscape Architecture, Geoscience
and Interior Design certifies
the training that laborers receive.[180] Once laborers have completed the classroom and
on-the-job training to be admitted to the union, they are not required to take
continuing education to maintain their union membership.[181]
81.
Laborers are eligible for dispatch out of the local
union hiring hall based on skills that they have completed. If an individual successfully completes the
“instruments” or the “line and grade” course, a notation is added to their
skills card confirming the completion of those courses, and the individual
could be dispatched if there is a specific request from a contractor for a
union employee to perform grading or line and grade work.[182] There is no evidence how often laborers are
dispatched to perform that type of work.
82.
The National Society of Professional Surveyors
offers a Certified Survey Technician (“CST”) designation. There are four levels of certification in
either field work or office work. Mn/DOT
currently requires that crew chiefs obtain Level 3 field track
certification. To be certified at Level
3, individuals must have 7,000 hours of experience (3.5 years minimum) and pass
an exam. Level 3 technicians must
demonstrate a thorough knowledge of survey computations, types of field
surveys, and field operations, and be well-versed in field note reduction and
in-depth plan interpretation and preparation.
They also must possess supervisory skills.[183] The questions in the CST Level 3 exam are quite involved, and it takes a
significant amount of knowledge, studying, and experience to be able to pass
that test.[184] It is likely that individuals who
have merely completed the elective laborers union training on instruments and
line and grade would not qualify for Level 3 CST certification.[185]
83. The work done by HTPO employees on the Project did not involve grass seeding, tree planting, sod laying, or other work commonly performed by Landscape Laborers,[186] or the significant physical labor or building activities commonly performed by Common Laborers.
84.
Both Common Laborers and Landscape Laborers on
State highway projects perform some tasks involving measuring and rely on the work
of surveyors in performing their jobs.[187]
85.
Common Laborers perform predominantly physical
tasks to assist in building construction projects.[188] While surveyors use instrumentation to obtain precise and accurate
locations, Common Laborers typically engage in simple measurements by essentially
taking a ruler and measuring off the points previously located by the land
surveyors to determine the proper elevation of gravel or location for work they
are performing in the field. For
example, laborers measure off of hubs set by surveyors to obtain elevations for
gravel or to mark the locations where trees should be planted.[189] Laborers constructing a retaining wall
after a surveyor has laid it out typically use a 4-foot carpenter’s level or an
automatic level, and they would level over and then measure down the distance
that they were told to cut or fill.[190]
86.
Some of
the tasks that landscapers perform in highway construction are also comparable
to those performed by surveyors.[191] For example, if a width is specified in plans
for sod (for example, off the back of a curb), Landscape Laborers measure with
a ruler or a tape measure off the back of the curb to get their sod limits. Similarly, if there is a requirement for
installation of trees, shrubs or bushes, Landscape Laborers may have a surveyor
set a stake with an offset as to where the location of that tree is when they
come in and install trees or shrubs. The
Landscape Laborers would then measure with a tape off of that point to get the
location of the tree. Landscape Laborers
perform all sorts of measuring tasks that are no different than what Common
Laborers do when measuring for the performance of their work.[192]
87.
Neither
Mr. Groshens nor Mr. Richards considered comparing survey field crews to Landscape
Laborers. They also did not consider the
monetary value of the wage rates when making their decision regarding the most
similar classification.[193] The prevailing wage rate for the classification
of Landscape Laborer was much closer to the rates that HTPO actually paid its
survey field crews on the TH 212 Project than was the prevailing wage rate for the classification of Common Laborer.[194]
88.
If HTPO
were required to pay the Landscape Laborers’ rate of $20.44, HTPO’s workers in
Billing Group 1 would need to be paid an additional $28,636.23. The total amount for all billing groups would
be $31,728.21.[195]
89.
The
work performed by HTPO survey crews on the Project is as similar to work
performed by those in the Landscape Laborer classification as it is to work
performed by those in the Common Laborer classification.[196]
VI. Wages Paid to Survey Crew Members
90.
The prime contractor and subcontractors on the
Project were required to submit weekly certified payrolls for all employees
working on the job that included the classifications of work performed, hours
worked each day, and hourly wages.[197]
91.
Tim Odell, the Deputy Project Manager for ZRC on
the TH 212 Project, advised Mr. Thorp to segregate time spent by HTPO on
the Project from time spent off the Project because, in his experience with prior
prevailing wage issues, there was usually some distinction made between on-site
and off-site work on the project. He
believed separating out the time in this fashion would make the bookkeeping
easier.[198]
92.
Based upon HTPO’s certified payrolls, HTPO’s
unlicensed survey crew members working in the field on the Project received
wages ranging from $11.00 per hour with no fringe benefits to $37.32 per hour
with $5.14 in fringe benefits.[199]
93.
HTPO
does not experience a lot of turnover with respect to its field survey crews
and believes its wages and benefits are competitive with those of other
companies.[200]
94.
Mn/DOT did not present any wage data suggesting
that survey field crews were typically paid more in 2005-2007 than HTPO paid,[201] or any
evidence that HTPO’s competitors paid
entry-level field survey crew employees $31.85/hour in wages and fringes (the
rate that applied to Common Laborers on the TH 212 Project) at that time.[202]
95.
The
wages HTPO paid to its field survey crews as of the beginning of the Project
were similar to those paid by another survey firm (Sunde Land Surveying) to its
field survey crews as of October of 2005.
At that time, Sunde paid its survey crews wages ranging from $12 to $29
per hour, and fringe benefits ranging from $0 to $11.85.[203]
96.
During 2005-2007, EVS, another land survey
contractor that worked on the Project, paid its survey crews wage rates ranging
from $17.50 to $32.85 per hour, and fringe rates ranging from $0 to $5.34.[204] While the fringe benefits rates paid by EVS
were similar to those paid by HTPO, there were differences in the hourly
wages. The lowest hourly wages paid by
EVS were considerably higher than those paid by HTPO, and the highest hourly
wages paid by HTPO were considerably higher than those paid by EVS.
97.
During
2007, the Carver County Surveyor paid entry-level survey technicians
$16.43/hour and its entry level Crew Chiefs $19.01/hour. The
98.
The 2004 federal minimum hourly wage rates set
under the Service Contract Act for Hennepin, Carver, and other counties in the
Twin Cities metro area for Survey Party Chief, Surveying Technician and
Surveying Aide were $24.34, $18.59, and $16.16, respectively.[206]
VII. The Varying
Positions of Mn/DOT regarding Surveyors
99.
As discussed below, Mn/DOT has not applied the
provisions of the PWA to those involved in survey work on State projects in a
consistent fashion during the past decade.
For example, at times, Mn/DOT has followed the interpretation of the
U.S. Department of Labor under the Davis-Bacon Act; at other times
(particularly in more recent years), it has not. In addition, Mn/DOT’s interpretation of when
and how the PWA applies to survey work has not always coincided with that
expressed by DOLI officials.
100.
Mn/DOT first addressed the issue of the
applicability of prevailing wage requirements to surveying work in a
Under the provisions of the DBA, survey work
that is performed immediately prior to or during the actual construction and
which directly supports the construction crew is covered. Since the construction surveying performed by
Gorman Surveying, Inc. is in direct support of the construction crew, the
activity is covered by the DBA.
However, certain survey crew members whose
duties are professional or sub-professional are not considered laborers or
mechanics, therefore, not subject to the wage determination. This includes workers employed by Gorman
Surveying, Inc. to establish and/or level grades through the use of an
instrument, transit, or rod.
Workers employed by Gorman Surveying, Inc.
to perform manual labor, such as clearing brush, checking grades, and
sharpening stakes are covered by the wage determination.[208]
Ms. Peterson made
no indication in the letter that any different interpretation would be applied
under the Minnesota PWA.
101.
By letter dated
When we have a two-person crew, we should list one
[on the certified payrolls] as a transit (or instrument) man, and the other as
a rodman. We should not list them simply
as survey technicians. You agreed that
putting in a stake or a lath is a task incidental to the rodman’s surveying
function.
When we have a third person on the crew, it is for
the purpose of getting more work done in the time available. The third person can still be considered a
rodman, provided that he or she is doing the same type of survey work as the
rod person on a two-man crew. If this
third person’s job on the crew is strictly to pound stakes or do some other
non-survey labor function, then that person should be classified as a laborer
and paid according to the prevailing wage schedule.
If we have four or more people on the job at once,
we should indicate on the certified payrolls which ones are instrument people
and which are rod people. This will help
the Mn/DOT field inspector evaluate the payrolls and compare the payrolls to
the labor interviews.
Mr. Kildahl urged
Mr. Groshens to distribute clarification to all of the Mn/DOT Construction
Offices regarding this issue and consider including clarification in the
proposal documents to assist those bidding on this type of work.[209]
102.
DOLI formed a Master Job Classifications Advisory
Committee for the prevailing wage master job classifications that held public
meetings on February 28, March 28, and
I
guess what we’re having problems with, about a year or two years ago Mn/DOT put
out a statement to allow for private entities to do a lot of our surveying in
conjunction with our highway-heavy projects.
Since then we have gotten numerous phone calls from counties, cities,
our own people, even surveying companies wanting to find out exactly where
their survey crews fall.
As far as the feds are concerned, the transit
person and also the rod person, the guy that’s actually putting things to the
right height, are not covered because they don’t consider them to be laborers
or mechanics, which is fine. The problem
comes into trying to define the additional work that goes on amongst doing the
surveying, such as string running, the pounding of the stakes, blue topping,
that kind of stuff, so I just want to try and get some clarification if we can
as to what should be covered, what shouldn’t be covered now that we’ve got more
and more of the private industry now doing the surveying in conjunction with
our projects. . . . [S]ome of the crew functions are covered
under prevailing wage laws such as the pounding of the stakes, blue topping,
running string line, that kind of stuff, which traditionally has been a Common
Laborers type operation, so that’s where it’s been sitting so far, but that’s
under the federal side and we haven’t had any guidelines to follow under the
state side.[212]
103.
In an e-mail message to William Smith of the
U.S. Department of Labor dated November 4, 2002, Mr. Groshens noted that
he was having many problems with prevailing wage issues relating to surveyors
and requested copies of any administrative decisions or similar information
that would help define this area. In his
response sent the same day, Mr. Smith told Mr. Groshens that "the survey
crews are not covered under DB as long as they perform the work normally
associated with surveying." Mr.
Smith also provided Mr. Groshens with copies of opinion letters issued by the
U.S. Department of Labor in 1993 and 1983 relating to coverage of survey crews
under the DBA. These letters expressed
the view that survey
work performed immediately prior to or during actual construction, and which is
in direct support of the construction activity is covered by the DBA. More specifically, the letters indicated that
the DBA prevailing wage provisions apply to survey crew members who
perform primarily manual work on the job site but did not apply to crew members
whose duties are primarily mental, professional, or subprofessional in
character.[213]
104.
By letter dated
The application of the state statute to your
situation is somewhat different than under federal DBRA. The state statute requires any contractor or
agent performing work under the contract to pay all employees the prevailing
wage rate for the same or most similar trade or classification of labor and
does not have provisions for exempting professional workers, as does the
DBRA. The only exception allowed under
the statute is for the manufacturing and delivery of materials by and for a
commercial establishment.
In your case, SEH is performing work under the
contract in direct support of the prime contractor activities. Therefore, your employees performing the work
are required to be paid the prevailing wage rate for the most similar
classification of labor. Many of the
listed classifications on the Master Job Classification list perform survey
duties in direct support of the on going construction activities, such as but
not limited to; ironworker would perform survey duties when setting iron,
carpenter would perform survey duties when setting wood forms, pipe layer would
perform survey duties when laying pipe etc.
It is the contractor’s responsibility to determine the classification of
labor their employees are performing based on the Master Job Classification
list.[217]
In the letter, Mr.
Groshens mentioned that DOLI had started to promulgate new rules surrounding
the surveyor issue but those rules had not been finalized, and asserted that,
until those rules were promulgated, it was Mn/DOT’s responsibility to enforce
the PWA “on a case-by-case basis according to the plain meaning of the
statute.”[218] The letter accurately stated the position of
Mn/DOT at that time.[219] Mn/DOT did not publicize this letter, nor was
a rulemaking commenced to adopt this policy.[220] This appears to be the first time that Mn/DOT
took the position that the reach of the PWA with respect to surveyors was
broader than that of the DBA.
105.
In 2003, Mr. Groshens and his staff at Mn/DOT
drafted a “wish list” of changes they would like made to DOLI’s rules under the
PWA. Mn/DOT staff recommended that
surveyors be given a separate classification in the Master Job Classification
or that language be added to include surveyors in existing classifications,
such as Laborers, Ironworkers, or Carpenters.
Mn/DOT brought this memo to the attention of Erik Oelker at DOLI.[221]
106.
On
107.
The Fall 2004 issue of the Minnesota Surveyor (the
official publication of the MSPS) included an article written by its president,
John V. Chafee, about the efforts of the MSPS to resolve the prevailing wage
issue as it applies to surveyors. Mr.
Chaffee stated:
In the past, it appears that MnDOT staff informally
decided that surveyors are professionals rather than laborers or mechanics, and
that the state prevailing-wage law does not apply to them. It also appears that MnDOT has the legal
authority to make that decision. In the
last few years, however, a different interpretation has sometimes been
made. It originates with a small MnDOT
bureau known as the Labor Compliance Unit (LCU). On some recent projects, the LCU has said
that the person driving stakes is a “laborer” and should be paid the prevailing
wage for construction laborers.
Generally this announcement has been made after the projects are
completed. Under the prevailing-wage
rules, construction laborers receive a higher hourly rate on these projects
than the wages of most private-sector field crew members and even some Licensed
Surveyors.[223]
After discussing
the wage rates set by DOLI for unskilled laborers and the average hourly wages
listed by the Department of Energy and Economic Development for “surveyors” and
“surveying and mapping technicians,” Mr. Chaffee noted:
As a result of the new prevailing-wage
interpretation, private firms that bid on state staking contracts now have no
way of knowing what wages they will be expected to pay. If they bid based on prevailing wage, they
will probably not get the contract. If
they assume that prevailing wage does not apply, they may be required to pay it
retroactively after the project is done, thereby incurring a considerable loss.[224]
Finally, Mr.
Chaffee mentioned that DOLI was considering adopting new rules that would make
it clear whether surveyors are subject to the PWA and, if so, what their wages
should be. He noted that DOLI was
accepting public comments on what the new rules should contain, and asked MSPS
members to provide him with their thoughts.[225]
108.
Mr. Thorp of HTPO was a member of the MSPS and
typically received a copy of its publications, but does not remember seeing
this article until it was disclosed by Mn/DOT prior to the hearing.[226]
109.
On November 4, 2004, the U.S. Department of
Labor issued a determination letter to the American Congress on Surveying and
Mapping stating that it has been a longstanding position of the Department of
Labor that preliminary survey work, such as the preparation of boundary surveys
and topographical maps, is not construction work covered by the Federal
Davis-Bacon Act, especially when performed pursuant to a separate contract.[227] The letter continued:
Where surveying is performed immediately prior to and during actual construction, in direct support of construction crews, such activity is covered by Davis-Bacon requirements for laborers and mechanics. The determination of whether certain members of survey crews are laborers and mechanics is a question of fact. Such a determination must take into account the actual duties performed. As a general matter, an instrumentman or transitman, rodman, chainman, party chief, etc are not considered laborers or mechanics. However, a crew member who primarily does manual work, for example, clearing brush, is a laborer and is covered for the time so spent.[228]
110.
The MSPS formed a Prevailing Wage Subcommittee to
address the perceived problems with the application of the PWA to surveyors working
on state-funded highway projects. The
Subcommittee issued its findings on
a. First,
the Subcommittee asserted that the comparison between the skills, duties, and
educational background of survey personnel and union laborers was
unrealistic. The Subcommittee argued
that the prevailing wage law was enacted to make sure that union workers in the
construction trades were paid a fair wage.
According to the Subcommittee, surveyors should be exempt from the PWA
because they are not in the construction trades and are not unionized.[229]
b. The
second issue addressed by the Subcommittee was that the wage rate for union
laborers is considerably higher than the average wages and benefits paid to
survey workers. The Subcommittee found
that these higher prevailing wages, while nice for surveyors, actually drive up
the cost of constructing roads. The
Subcommittee proposed establishing new labor classifications that are more consistent
with the actual wages paid to surveyors.[230]
c. Third,
the Subcommittee asserted that the PWA was being applied subjectively and
inconsistently by DOLI and Mn/DOT. The
Subcommittee found that prevailing wage determinations were task-specific and
not position-specific, making it difficult for contractors to make accurate
estimates regarding surveying costs, and recommended that a position-specific
approach be used.[231]
The Subcommittee
requested input from the industry on its findings and on the following draft
classifications: Survey Technician;
Survey Crew Chief; and Survey Technician, Seasonal.[232]
111.
During the time period relevant to this proceeding,
there is no evidence that Mn/DOT made efforts to provide notice in Mn/DOT
contracts or otherwise publicize the fact that it had interpreted the PWA to
apply to members of survey crews regardless of the performance of manual labor or
that it had determined on several occasions that surveyors’ work was most
similar to the Common Laborers classification.
112.
At some point during 2007-2009, after the TH 212
Project was well underway, representatives of the MSPS spoke to the DOLI
Commissioner and DOLI Assistant Commissioner Roslyn Carter Wade about their
concerns regarding the absence of a specific classification for non-licensed
personnel in the field.[233] Assistant Commissioner Wade told the MSPS
representatives that, absent a specific classification based on the work that
such individuals performed, their work was most similar to the laborers
classification and the laborer’s rate of pay would be required to be paid to
them for work performed on a State-funded project.[234]
113.
Mn/DOT
included the following language regarding prevailing wages for surveyors in the
design-build contract documents relating to the I-35W bridge project, which
were executed on August 23, 2007:
Surveys
performed to progress the construction activities on the project are covered by
the contract labor requirements. The
workers performing the work shall be paid at a minimum wage based on the most
similar trade or occupation as set forth in Exhibit F.[235]
The TH 212 Project contract did not contain
this language.[236]
114.
Rani
Engineering, a subcontractor on the I-35W bridge project, was involved in
performing survey work on that project.
In March 2008, Mike Prestine of Rani Engineering sent the following
email to Mr. Oelker of DOLI summarizing a conversation they had had about the
applicability of the PWA to Rani’s surveyors:
As discussed, please review the summary
below of our conversation to ensure that it is accurate:
Regarding our surveyors on the I35W bridge
project, they are not subject to Minnesota Department of Labor and Industry
Prevailing Wages for State Funded Construction projects. They are running surveying instruments, doing
CAD work, performing computations, and providing other civil/surveying
technical services. They do have to
pound some hubs, mark and flag laths, chisel some control in the concrete, but
these are all incidental items that need to be done in support of their
technical work. This does not constitute
the major part of their job.
The classification for 101 Laborer, Common
(Gen Labor Work) would apply if the staff on this bridge project was pounding
hub, running stakes, or doing other type of grunt work.[237]
Mr. Oelker responded to this email on
115. Ultimately, the
Rani Engineering surveyors were classified as Skilled Laborers and Rani was
required to pay, and did pay, prevailing wages to those individuals. The back wages were limited to work performed
on-site and did not extend to time spent in Rani’s office.[239]
116. Charles Groshens of Mn/DOT told Mr. Thorp of
HTPO during meetings held in
117. Prior to the current case, Mr. Richards has never
demanded that surveyors be paid prevailing wages for their time spent in the
office on any of the projects on which he has worked.[241]
There is no evidence that Mn/DOT has
done so in any other cases.
118.
At some point in early 2009, HTPO was bidding on a Mn/DOT
project to remodel its headquarters in
VIII.
DOLI Rulemaking under the PWA
119.
DOLI
first adopted administrative rules under the PWA in 1977. Those rules defined the classes of labor and
established procedures for determining the prevailing rates for classes of
labor involved in highway construction projects. In 1988, DOLI adopted truck rental rules,
which were revised in 2001 as a result of various legal challenges. In 1997, DOLI amended the rules relating to
master job classifications for power equipment and truck drivers. The 1997 rule amendments also made changes in
the manner in which prevailing wages for highway-heavy construction were calculated.[248]
120.
In February of 1998, the Court of Appeals issued an
unpublished decision in International
Union of Operating Engineers, Local 49, v.
MnDOT can enforce
Minn. Stat. § 177.44, as required under the [1996] declaratory judgment,
without enforcing its previous guidelines for interpreting the term “commercial
establishment.” MnDOT’s enforcement will
simply have to be on a case-by-case basis.
[Citation omitted.] Also, MnDOT
can enforce Minn. Stat. § 177.44 on all noncommercial off-site facilities
associated with highway construction projects that involve federal funds
without first issuing a notice that it will do so.[252]
121.
In
October of 1999, the Minnesota Court of Appeals issued a decision in a lawsuit
filed by L & D Trucking and
others against Mn/DOT.[253] In that case, prospective bidders on state
highway projects sought a judgment declaring that Mn/DOT’s interpretation of
the term “commercial establishments” as used in the PWA was invalid and entry
of an order enjoining Mn/DOT from applying the interpretation. The Ramsey County District Court determined
that Mn/DOT was in willful contempt of two prior court orders and awarded
attorney’s fees. The Court of Appeals
reversed, holding that the record in that case showed that Mn/DOT was
attempting to enforce the PWA “on a case-by-case basis, applying specific facts
to specific parties,” and “was not . . . applying its published interpretation
of the term ‘commercial establishments’ as if it were a properly promulgated
rule.”[254] The Court noted, however, that it was “not
unmindful of the problems that case-by-case enforcement of the prevailing-wage
law creates for contractors who want to bid on state highway projects” and
therefore “encourage[d] formal rulemaking by the Minnesota Department of Labor
and Industry or other appropriate agency” to establish a definition of the term
“commercial establishments.”[255]
122.
On
123.
DOLI
appointed an ad hoc advisory
committee on master job classifications to provide it with input regarding the
need for additional classifications. The
advisory committee met in February, March, and April of 2002 to gather
information from interested members of the public. The meetings were open to the public, and
written transcripts were prepared.[258]
124.
In June
of 2004, the Minnesota Court of Appeals issued a ruling in a declaratory
judgment action in which a subcontractor (AAA Striping Service Company)
challenged the classification of its pavement “striper” and “striper tender”
employees that had been made by Mn/DOT and DOLI under the PWA.[259] The
Ramsey County District Court had previously granted summary judgment in favor
of Mn/DOT and DOLI. On appeal, the Court
of Appeals reversed and remanded, holding, among other things, that AAA was
entitled at a minimum to administrative review of the classification of its
striper and striper tender employees.
The Court also determined that the lower court’s entry of summary
judgment for the state was inappropriate due to the absence of an agency
record, uncertainty regarding the origin of the state’s classification of the
employees at issue in the case, and the existence of material issues of fact
regarding DOLI’s classification determination and the subcontractor’s equitable
estoppel claim.[260] Although the Court was persuaded by DOLI’s
argument that it “is entitled to flexibility and discretion to depart from
formal rulemaking when it deems the situation clear,”[261]
it stated that, “in the present situation rulemaking may be most appropriate.”[262] The
Court underscored the importance of classification decisions and the need to
provide due process to affected parties:
To
determine whether and to whom DOLI is accountable for decisions not to follow
through with rulemaking, we note the importance of classification and the
context in which such decisions are made.
Workers, labor unions, contractors, subcontractors (including AAA), and
perhaps even local units of government, have a substantial interest in the
classification process. Fair wages,
workers’ livelihoods, the financial feasibility of projects, and
entrepreneurial opportunities for contractors may be affected by these
decisions. The statutes mandate
investigation and hearings necessary to define worker classifications. This is strong legislative directive to
observe the basics of procedural due process in making classification
decisions. Minn. Stat. § 177.44, subd. 3. We conclude that at a minimum, DOLI should
engage in rulemaking as specified in its own regulations, or, in the
alternative, make available a reconsideration process with a contested case
proceeding when requested by an aggrieved party. Like judicial proceedings, such a contested
case proceeding can be abbreviated if the nature of the matter justifies
summary action. To say that the decision
to include striper and striper tenders in an existing classification is
entirely within the discretion of DOLI, that it can exercise this discretion without
a record or a hearing, and that there is no review available is inconsistent
with DOLI’s own rules, the statutes, and with the principles of procedural due
process.[263]
The Court further noted that the rulemaking
process commenced by DOLI in 2001 to consider changes to the Master Job Classifications
was “unfinished and possibly dormant” and found under the circumstances that
“this arguably pending rulemaking does not constitute compliance with DOLI’s
obligations” under Minn. R. 5200.1030, subp. 2a.C.[264]
125.
On
126.
On
127.
Despite
the fact that it had published Requests for Comments in 1999, 2001, 2004, and
2006, and convened an advisory committee in 2002, and despite the Court of
Appeals’ decisions in 1999 and 2004 encouraging rulemaking efforts, DOLI did
not schedule a rulemaking hearing regarding proposed amendments to the
prevailing wage rules until late May of 2008.
Factors contributing to this delay included DOLI’s limited resources,
emphasis on other priorities, and the fact that four different DOLI
Commissioners served during that period of time.[268]
128.
On
129.
DOLI’s
proposed rule amendments were developed in cooperation with Mn/DOT.[270]
130.
DOLI’s
SONAR relating to the proposed rules stated with respect to Class 110 - Survey
Field Technician:
This
is a new master job classification proposed to reflect the trend towards
including surveying in the scope of work on both highway-heavy and commercial
construction prevailing wage projects.
In the past the bulk of the surveying on highway and heavy projects was
performed by MNDOT personnel or county surveyors. Now the construction contracts tend to call
for the surveying work to be performed by on [sic] behalf of the general
contractor as part of the work under the construction contract. The new classification covers the person
operating the transit and the person holding the rod, not the registered land
surveyor or survey foreman/supervisor.
The
new classification is necessary to reflect the changes in construction
practices where the contracting agency performs less of the surveying services
and a growing portion of the surveying work is part of the scope of work under
the construction contract. The new
classification is reasonable because it covers the work actually performed at
the construction site and doesn’t include the professional services of
registered land surveyors or their foreman/supervisors.[271]
131.
A
hearing was held regarding DOLI’s proposed rules on
132.
The
Report of Administrative Law Judge Eric L. Lipman regarding DOLI’s proposed
amendments to the prevailing wage rule was issued on
133.
On
Survey field
technician (operate total station, GPS receiver, level, rod or range poles,
steel tape measurement; mark and drive stakes; hand or power digging for and
identification of markers or monuments; perform and check calculations; review
and understand construction plans and land survey materials). This classification does not apply to the
work performed on a prevailing wage project by a land surveyor who is licensed
pursuant to Minnesota Statutes, sections 326.02 to 326.15.[278]
134.
At the time of the hearing in this contested
case matter, DOLI was conducting wage surveys to determine what the prevailing
wages and hours of work are for field survey technicians across the State. The wage surveys had not been completed or
certified as of the date of the hearing.
They were expected to be completed by the end of calendar year 2009.[279]
IX. Contested
Case Proceedings
135.
The Notice and Order for Hearing in this matter was
issued by Mn/DOT on
Whether prevailing
wage payments to workers by Respondent ZRC’s subcontractor, Respondent HTPO,
were proper and/or does Respondent HTPO owe back wages to the workers on State
Project No. 1017-12 which was funded in whole or in part with State and Federal
funds in violation of the Minnesota Department of Transportation Standard
Specifications for Construction Number 1808(9) (2000) and/or the State
Prevailing Wage Act Minn. Stat. §§ 177.41 through 177.44 (2006).[281]
136.
On June 23, 2008, ZRC and HTPO sought dismissal/summary
disposition of Mn/DOT’s claims for additional wages. After the motion was fully briefed, the
Administrative Law Judge denied the motion in a ruling issued on September 24,
2008, finding that genuine issues of material fact remained for hearing and the
Respondents had not shown at that stage of the proceedings that they were
entitled to judgment as a matter of law.
137.
The case proceeded to hearing on July 8, 9, 10, and 15, and September 15,
2009, and post-hearing briefs were submitted.
On
the last day of hearing in this matter, Mn/DOT asserted that HTPO’s “office”
time relating to the TH 212 Project was also covered under the PWA.[282] When Mn/DOT filed its post-hearing Reply
Memorandum in this matter on November 13, 2009, it attached a 36-page document
labeled as “Appendix A” which indicated that the total back wages owed to HTPO
employees under the PWA is $239,543.44. By letter filed on November 20, 2009, Respondents
objected to Appendix A and asked that it be stricken from the record. By letter filed on December 1, 2009, Mn/DOT
asked that the request to strike be denied.
Based upon these Findings of Fact, the Administrative Law Judge makes the following:
CONCLUSIONS
1.
The Administrative Law Judge and the Commissioner
of Transportation have jurisdiction over this matter pursuant to Minn. Stat. §§
14.50 and 177.44, subd. 7.
2.
The Notice of Hearing is proper in all respects and
the Department complied with all procedural requirements of law and rule.
3.
Mn/DOT
bears the burden of proving the facts at
issue in this matter by a preponderance of the evidence.[283]
4.
The Minnesota Prevailing Wage Act (PWA) is a
minimum wage law that applies to construction projects financed in whole or in
part by state funds. Its purpose is to
ensure that those who work on such projects are paid wages comparable to wages
paid for similar work in the community.[284]
5.
The PWA is codified at Minn. Stat. §§ 177.41 -
177.44. The accompanying administrative
rules are set forth at Minn. R. 5200.1000 - 5200.1120. Together, the statutes and the rules govern
the determination, certification, and payment of prevailing wages to laborers,
workers and mechanics working on state-funded construction projects.
6.
The prevailing wage must be paid for “work under
the contract,” which means “all construction activities associated with the
public works project” regardless of whether the construction activity or work
is performed by the prime contractor or subcontractor.[285]
7.
Under the PWA, DOLI establishes the labor
classifications for workers and determines the prevailing wage rate for the
classifications.[286]
Those classifications, Master Job
Classifications, appear in Minn. R. 5200.1100. “Laborer or mechanic” means a worker in a
construction industry labor class identified in or pursuant to part 5200.1100.[287]
8.
According to Minn. R. 5200.1030, subp. 2a, item C,
of the DOLI rules:
If work is
performed by a class of labor not defined by part 5200.1100, Master Job
Classifications, the contracting agency shall assign a wage rate and the
commissioner of labor and industry shall review and certify the assigned wage
rate based on the most similar trade or occupation from the area wage determination. Within 90 days, the Commissioner of Labor and
Industry must initiate the rulemaking procedure so that the classification will
be defined in the Master Job Classifications in part 5200.1100.
9.
When determining particular classes of labor, DOLI
is required by the rules to “consider work classifications contained in
collective bargaining agreements, apprenticeship agreements on file with the
department, the ‘United States Department of Labor Dictionary of Occupational
Titles,’ and customs and usage applicable to the construction industry.”[288]
10.
If a state contractor does not abide by the PWA,
the consequences may include misdemeanor criminal sanctions (including
imprisonment) and a $300 fine. In
addition, the Commissioner of Transportation may reject the bids of any
contractor who has failed to perform a previous contract with the State.[289]
11.
While Mn/DOT has neither a policy- nor a rate-setting
role under the PWA, it does have a role in enforcing the requirements of the
Act. The Commissioner of Transportation
is authorized by state law to “require adherence” by its contractors to the
provisions of the PWA.[290]
12.
In an appropriate case, the PWA likely could be
interpreted to cover at least some portion of the work performed by surveyors
on projects funded in whole or part by state funds. However, it is not appropriate to apply the
PWA to the Respondents in the present case.
13.
Mn/DOT cannot properly require ZRC and/or HTPO to
pay back wages under the PWA in the present case because:
·
Mn/DOT and DOLI failed to properly assign a wage
rate to HTPO’s survey crews under Minn. R. 5200.1030, subp. 2a(C), and 5200.1040(F);
·
DOLI did not take action to initiate rulemaking to
define the surveyor classification in the Master Job Classifications within 90
Days of the initial decisions by MN/DOT and DOLI that surveyors were subject to
the PWA;
·
Mn/DOT’s attempt to enforce the PWA with respect to
surveyors amounts to unauthorized rulemaking; and
·
Mn/DOT failed to carry its burden to show by
a preponderance of the evidence that Common Laborer was the most similar trade or
occupation.
14.
The Memorandum that follows explains the reasons
for these Conclusions, and the Administrative Law Judge therefore incorporates
that Memorandum into these Conclusions.
15.
The Administrative Law Judge adopts as Conclusions
any Findings that are more appropriately described as Conclusions.
Based upon these Conclusions, and for the reasons set forth in the attached Memorandum, the Administrative Law Judge makes the following:
RECOMMENDATION
IT IS HEREBY RECOMMENDED that the
Commissioner withdraw Mn/DOT’s claim that back wages are owed to HTPO employees
and remit to Respondents any contract proceeds that have been withheld.
Date:
April 23, 2010.
|
__s/Barbara L.
Neilson___________ ___ |
|
|
BARBARA L.
NEILSON |
|
|
Administrative
Law Judge |
|
NOTICE
This
report is a recommendation, not a final decision. The Commissioner of Transportation will make
the final decision after a review of the record and may adopt, reject or modify
these Findings of Fact, Conclusions, and Recommendation. Under Minn. Stat. § 14.61, the Commissioner
shall not make a final decision until this Report has been made available to
the parties for at least ten days. The parties
may file exceptions to this Report and the Commissioner must consider the
exceptions in making a final decision. Parties
should contact Khani Sahebjam, Deputy
Commissioner of Transportation,
If the
Commissioner fails to issue a final decision within 90 days of the close of the
record, this report will constitute the final agency decision under Minn. Stat.
§ 14.62, subd. 2a. The record closes
upon the filing of exceptions to the report and the presentation of argument to
the Commissioner, or upon the expiration of the deadline for doing so. The Commissioner must notify the parties and
the Administrative Law Judge of the date on which the record closes.
Pursuant to Minn.
Stat. § 14.62, subd. 1, the Commissioner is required to serve its final
decision upon each party and the Administrative Law Judge by first class mail.
MEMORANDUM
I. Burden of Proof
During a telephone
conference call held shortly before the start of the hearing, Mn/DOT asserted
that Respondents HTPO and ZRC bore the burden of proof in this matter. Respondents disagreed and urged that the
burden be placed on Mn/DOT. The
Administrative Law Judge indicated that she was of the opinion that the burden
of proof was on Mn/DOT to provide by a preponderance of the evidence that
violations of the PWA occurred, but informed the parties that they would be
given an opportunity to present arguments on this issue in their post-hearing
submissions.[291] Both parties included further argument on
this issue in their briefs.
The PWA does not
specifically address which party must bear the burden of proof in contested
case proceedings involving alleged violations of the Act. Where the governing statute is silent, the
rules of the Office of Administrative Hearings provide the following
guidance:
Burden
of proof. The party proposing that certain action be taken must prove the facts
at issue by a preponderance of the evidence, unless the substantive law
provides a different burden or standard. A party asserting an affirmative defense shall
have the burden of proving the existence of the defense by a preponderance of
the evidence. In employee disciplinary
actions, the agency or political subdivision initiating the disciplinary action
shall have the burden of proof.[292]
Mn/DOT
argues that it, in conjunction with DOLI, assigned and certified a wage rate as
required by Minn. R. 5200.1030, subp. 2a, and thereafter notified Respondents of
the determination, as well as their right to request a contested case
hearing. Mn/DOT asserts that, because
ZRC and HTPO requested this hearing, the burden of proof rests with them.[293] To support its argument, Mn/DOT relies on the
scope of judicial review set forth in Minn. Stat. § 14.69, and case law that
requires the courts to defer to agency decisions and expertise.[294]
Respondents
correctly point out that Minn. Stat. § 14.69 applies not to the burden of proof
in contested case hearings, but rather to the scope of judicial review to be
applied by reviewing courts after a recommendation
and decision are made by OAH and the Commissioner, respectively.[295] In addition, Respondents contend that the
burden of proof rests with “the party making the proposals” or the party
seeking to invoke a statute.[296]
The
Administrative Law Judge concludes that it is Mn/DOT who must bear the burden
of proof in this proceeding. Because Mn/DOT
asserts that HTPO owes its employees in excess of $200,000 in additional wages as a result of violations of Minnesota’s
prevailing wage laws, Mn/DOT is the party that is “proposing that certain action be taken”
under Minnesota Rule 1400.7300.
Accordingly, Mn/DOT has the burden of proving the facts at issue by a preponderance of the
evidence. This conclusion is consistent
with the ruling in another recent case arising under the PWA.[297]
II. Applicability of the PWA to Survey Crews
The PWA specifies that a “laborer or mechanic employed by a contractor, subcontractor, agent, or other person doing or contracting to do all or part of the work under a contract . . . to which the state is a party, for the construction or maintenance of a highway” must be paid “at least the prevailing wage rate in the same or most similar trade or occupation in the area.”[298] The phrase “laborer or mechanic” is defined in the DOLI rules to mean “a worker in a construction industry labor class identified in or pursuant to part 5200.1100.”[299] “Work under the contract” is defined in the DOLI rules to mean:
all construction activities associated with the public works project, including . . . work conducted pursuant to a contract . . ., regardless of whether the construction activity or work is performed by the prime contractor, subcontractor, trucking broker, trucking firms, independent contractor, or employee or agent of any of the foregoing entities, and regardless of which entity or person hires or contracts with another.[300]
Respondents maintain that survey crews are not “laborers” or “mechanics” performing work under the contract and are not engaged in “construction activities,” but rather are professional design team members providing professional services on the Project. In support of their argument, Respondents point out that the U.S. Department of Labor Dictionary of Occupational Titles, which DOLI is required to consider when making labor classification determinations, classifies land surveyors and their assistants as “professional” occupations.[301] In contrast, Respondents assert that the common dictionary definition of “laborer” is “a person who does unskilled physical work for wages,”[302] and the Dictionary of Occupational Titles describes “Construction Worker II” as an individual who performs tasks that require “little or no independent judgment.”[303] Respondents emphasize that HTPO’s subcontract was labeled as one for professional services; HTPO maintains professional liability insurance for all of their employees; HTPO is a professional service corporation for tax purposes; and HTPO’s work is regulated by the Board of Architecture, Engineering, Land Surveying, Landscape Architecture, Geoscience, and Interior Design.[304] Respondents contend that the demonstration conducted at the hearing by Mr. Mehlhop and Mr. Stadsvold shows that surveyors and surveyor assistants perform complicated work requiring skill, judgment, and precision.[305] Respondents also note that surveyors are only covered by the federal Davis-Bacon Act if they are primarily doing manual work, and argue that the hearing testimony established that HTPO’s two-person crews are not engaged in primarily manual labor. Finally, Respondents contend that HTPO’s work involves design work – specifically, verifying the site conditions reflected in the design – and not “construction activities,” and therefore does not fall within the definition of work “under the contract.” Respondents view their work as work that must be completed before construction can proceed by others.
Mn/DOT contends that there is no question that the PWA requires that prevailing wages be paid to those performing survey work on projects funded in whole or part by state funds. In this regard, Mn/DOT asserts that surveyors engage in work under the prime contract and perform work to further construction activities. Mn/DOT further argues that coverage of surveying tasks is in keeping with the PWA language[306] stating that the public policy underlying the Act is to pay “laborers, workers, and mechanics on projects funded in whole or part by state funds” a wage comparable to that paid for similar work in the community.[307] Although survey crew members are not identified in a construction industry labor class set forth in part 5200.1100, Mn/DOT points out that it may assign a wage rate based on the most similar trade or occupation in an existing classification consistent with Minn. Rule 5200.1030, subp. 2a(C). Mn/DOT maintains that, read together, these statutes and rules demonstrate that the prevailing wage applies to all work performed on a project under a State contract unless a specific exemption applies, and that any worker on a state project is defined as a “laborer or mechanic.”[308]
The Administrative Law Judge concludes that, in an appropriate case, the
PWA likely could be interpreted to cover at least some portion of the work
performed by surveyors on projects funded in whole or part by state funds. If certain surveyors engage primarily in
physical labor, it is possible that they may fall within the category of
“laborer.” Moreover, since the PWA
contains a broad policy statement referring to “workers” on covered projects as
well as “laborers” or “mechanics,” the reach of the PWA arguably should not be
restricted to those acting in the capacity of “laborers” or “mechanics.” The PWA does not contain an exception for
professional workers, as does the federal Davis-Bacon Act, and the evidence in
this record demonstrates that survey crew members do not have licenses or
specialized training other than that obtained on-the-job. In addition, the DOLI rules define “work
under the contract” to include “all construction activities associated with the
public works project, including . . . work conducted pursuant to a contract . .
., regardless of whether the construction activity or work is performed by . .
. [a] subcontractor.” It appears that at
least some of the work performed by surveying firms could be interpreted to be
work performed to further construction activities or aid the progress of the
construction of a project. However, for
the reasons set forth below, the Administrative Law Judge has determined that
the current case is not an
appropriate case to require payment of back wages under the PWA. As a result, it is not necessary for the
Administrative Law Judge to decide definitively which portion of the work
performed by surveyors could be subject to prevailing wage requirements under
other circumstances.
III. Respondents Cannot Properly Be
Required to Pay Back Wages
Even if it is
assumed that the PWA may apply to at least some part of the work performed by
survey crews on State highway projects, the Administrative Law Judge concludes
that Mn/DOT cannot properly require ZRC and/or HTPO to pay back wages under the
PWA in the present case. There are
several reasons for this determination:
(1) Mn/DOT never properly
assigned a wage rate to survey field crews on the Project; (2) DOLI failed to initiate rulemaking to define the surveyor classification
in the Master Job Classifications within 90 days of the initial decision that
surveyors were subject to the PWA; (3) Mn/DOT’s
attempt to enforce the PWA with respect to surveyors amounts to unauthorized
rulemaking; and (4) Mn/DOT failed to
carry its burden to show that Common Laborer was the most similar trade or
occupation. Each of these points is
discussed below.
A. Mn/DOT
and DOLI Failed to Properly Assign a Wage Rate to HTPO’s Survey Crews
It is undisputed that the list of Master Job Classifications included in
the DOLI rules in effect prior to March 2009 did not include a separate
classification for surveyors. The
parties also agree that no specific prevailing wage rate for survey crews was
set forth in ZRC’s prime contract or in HTPO’s subcontract on the Project. The DOLI rules adopted under the PWA set forth a
particular process to be followed in instances in which work on a prevailing
wage project is performed by a class of labor not named in the Master Job Classifications. Since surveyors did not have their own
classification in the Master Job Classifications list at the time, the process
for assigning a wage rate was governed by Minn. R. 5200.1030, subp. 2a(C). According to that rule:
If work is performed by a class of labor not
defined by part 5200.1100, Master Job Classifications, the contracting agency
shall assign a wage rate and the commissioner of labor and industry shall review and certify the assigned wage
rate based on the most similar trade or occupation from the area wage
determination. Within 90 days, the Commissioner of Labor and Industry must initiate
the rulemaking procedure so that the classification will be defined in the
Master Job Classifications in Part 5200.1100.[309]
Once
the contracting agency (here, Mn/DOT) has assigned a wage rate, the rule
requires that the Commissioner of DOLI “review and certify” the wage rate
assigned by the contracting agency “based on the most similar trade or
occupation from the area wage determination.” With respect to this requirement, Mn/DOT
Senior Labor Investigator Robert Richards testified that he contacted Erik
Oelker at DOLI. As reflected in the
Findings of Fact, Mr. Richards told Mr. Oelker that he had determined that the
apprenticeship program that was created by DOLI for laborers included 160 hours
of “required” training on surveying work, and informed him that he believed
that the 101 Common Laborer classification on the existing Master Job
Classification list was the most similar classification with respect to the
duties performed by the surveyors on the TH 212 job. Mr. Oelker told Mr. Richards that he
concurred. Mr. Richards did not have any
contact with anyone else at DOLI regarding this issue. Neither Mr. Oelker nor anyone else at DOLI ever certified or
confirmed in writing that DOLI believed that Common Laborer was the most same
or similar trade or occupation to survey field crews. Mr. Richards generally did not receive written
confirmation from Mr. Oelker during this time frame.
The term
“certify” is not defined in the PWA or in the DOLI rules. Under the canons of construction, words and
phrases set forth in Minnesota statutes generally are to be construed
“according to their common and approved usage,” while technical words and phrases
that have acquired a special meaning or are defined in statute are construed
according to such special meaning or definition.[310] According to the Merriam-Webster On-Line
Dictionary, the common meaning of the term “certify” is as follows:[311]
1 : to attest authoritatively: as a : confirm b : to
present in formal communication c : to attest as being true or as represented or
as meeting a standard d : to
attest officially to the insanity of
2 :
to inform with certainty : assure
3 :
to guarantee (a personal check) as to signature and amount by so indicating
on the face
4 :
to recognize as having met special qualifications (as of a governmental agency
or professional board) within a field <agencies that certify teachers>
The Merriam-Webster
On-Line Dictionary identifies “attest,” “witness,” and “vouch” as synonyms of
“certify,” and states that the term “usually applies to a written statement,
especially one carrying a signature or seal.”
The term “certify” is similarly defined in Black’s Law Dictionary as “to
authenticate or verify in writing” or “to attest as being true or as meeting
certain criteria.”[312] The Minnesota Supreme Court has also, in a long
line of cases, construed the term “certify” to mean “to testify to a
thing in writing.”[313]
It is evident that neither the
Commissioner of DOLI nor Mr. Oelker on behalf of the Commissioner ever
certified in writing or attested that Common Laborer was the most similar
construction trade or occupation in light of the type of work performed by HTPO’s
employees. Mn/DOT’s witnesses testified
that, during the relevant time period, it was typical for Mr. Oelker to simply
engage in conversations about such matters with Mn/DOT investigators and not
issue anything in writing. However, such
an informal process is not what is contemplated by Minn. R. 5200.1030; rather, certification
by the Commissioner is required. Failure to comply with this requirement is
not a “harmless error,” as Mn/DOT argues.
Issuance of a formal written certification by or on behalf of the
Commissioner would ensure that DOLI more formally examined each particular wage
assignment made by a contracting agency and would also serve the purpose of
providing some notice to regulated parties of the State’s intent to require
payment of prevailing wages. Had written
certification been issued in the past with respect to other surveying firms
that were required to pay prevailing wages to surveyors, it is conceivable that
HTPO would have learned of this certification and would have assumed higher
wages for its surveyors when making its bid on the Project. Written certification also would be more
likely to trigger rulemaking by DOLI to define the classification, as
contemplated by the rule. Because Mn/DOT
failed to ensure that the Commissioner of DOLI properly certified the wage
rate, it did not follow the proper procedure to assign a wage rate to the HTPO
surveyors.
Finally,
the DOLI rules specify in part 5200.1040 that “work classifications contained
in collective bargaining agreements, apprenticeship agreements on file with the
department, the ‘United States Department of Labor Dictionary of Occupational
Titles,’ and customs and usage applicable to the construction industry” must be
considered in determining particular classes of labor.[314] Mn/DOT admitted in response to Respondents’
Requests for Admissions that it did not consult the Dictionary of Occupational Titles in connection with its
prevailing wage investigation prior to the issuance of Mr. Richards’ June 19,
2007, letter concluding that the Common Laborer classification was the same or most similar
trade or occupation for the work performed by HTPO’s employees, or Mr. Ravn’s August 15, 2007, letter
directing that back wages be provided to HTPO employees within 20 calendar
days.[315] And there is no evidence that DOLI reviewed
the Dictionary of Occupational Titles in considering whether the general
laborer rate should be assigned to surveyors.
This provides further evidence that Mn/DOT and DOLI failed to comply
with the applicable rules in assigning a wage rate to HTPO surveyors.
B. DOLI Did Not Take Action to Initiate
Rulemaking to Define the Surveyor Classification in the Master Job
Classifications within 90 Days of the Initial Decisions by Mn/DOT and DOLI that
Surveyors were Subject to the PWA
Part 5200.1030 of the rules requires that, after reviewing and
certifying the appropriate wage rate, the Commissioner of DOLI “must” take
action “within 90 days” to “initiate the rulemaking procedure so that the
classification will be defined in the Master Job Classifications” set forth in
part 5200.1100. If rulemaking is
commenced and rules are adopted, regulated parties would receive some notice that
the State intended to apply the PWA requirements to a class of labor not
specifically defined in the existing rules.
Mn/DOT contends that DOLI complied with this provision because it had published Requests for Comments on possible
amendments to the prevailing wage rules in 1999, 2001, 2004, and 2006, and
convened an advisory committee in 2002.
However, neither the 1999 Request for Comments nor the 2001 Request for
Comments mentioned that DOLI was considering creating a new classification
applying to survey technicians, and the brief discussion of survey crews that
occurred during the April 2002 advisory committee meeting included comments by
Mn/DOT representatives implying that Mn/DOT agreed with the federal
interpretation that the prevailing wage requirements only applied to those
performing manual labor. Moreover,
DOLI’s rulemaking efforts proceeded only in fits and starts during the next
decade, and several lengthy stretches of apparent dormancy occurred. DOLI acknowledged in both its 2004 and 2006
Requests for Comments that the rule amendments contemplated earlier had been
“put on hold” due to budget priorities and a longer-than-anticipated advisory
committee process. DOLI did not schedule
a rulemaking hearing regarding proposed amendments to the prevailing wage rules
until late May of 2008, the rulemaking hearing did not occur until late July of
2008, and final rules were not adopted until March of 2009. Under the circumstances of this case, the
Administrative Law Judge does not agree that DOLI’s brief convening of an
advisory committee in 2002 and its issuance of a series of Requests for
Comments before finally proposing rules in 2008 were sufficient to satisfy
DOLI’s obligations under Minn. R. 5200.1030.
While the Court of Appeals recognized in the AAA Striping case that DOLI has the flexibility and discretion to
depart from formal rulemaking when it “deems the situation clear,”[316] it
is evident that surveyors do not fall into that category. In fact, counsel for DOLI acknowledged during
the 2008 rule hearing that a separate classification for survey field
technician had been included in the proposed rules at the request of Mn/DOT
because “the workers out actually in the field doing those tasks and using
those pieces of equipment that are listed there [in the proposed rule] need to
be covered by a labor class and--or by a job classification, and they probably really need to have one of
their own because they’re significantly different than the other classes . . . .”[317]
Because DOLI did not initiate a rulemaking proceeding to include
surveyors within the Master Job Classifications within 90 days of the initial
decisions by MN/DOT and DOLI that surveyors were subject to the PWA, it failed
to comply with Minn. R. 5200.1030. By
virtue of this failure, survey subcontractors were not placed on official
notice that they should assume when placing bids on state-funded projects that
some or all of their survey employees working on the project would have to be
paid at the prevailing wage rate applicable to Common Laborers or some other
labor classification.
C. Mn/DOT Engaged in
Unauthorized Rulemaking
The Respondents argue in the present
case that Mn/DOT engaged in unauthorized rulemaking when its investigators
determined that the work performed by HTPO’s surveyors was covered by the PWA
and fell within the Common Laborer classification. Mn/DOT contends in response that it was not engaging
in rulemaking but rather in “case-by-case” adjudication of a situation in which
work was being performed by a class of labor not defined in the Master
Classifications List.
The Minnesota Administrative
Procedure Act (APA) broadly defines the term “rule” to mean “every agency
statement of general applicability and future effect, including amendments,
suspensions, and repeals of rules, adopted to implement or make specific the
law enforced or administered by that agency or to govern its organization or
procedure.”[318] The APA requires that agencies adopt rules by
following the rulemaking procedures set forth in the statute. Specifically, the APA states that agencies “shall”
adopt rules that set forth “the nature and requirements of all formal and
informal procedures” that relate to the administration of the agency’s official
duties “to the extent that those procedures directly affect the rights of or
procedures available to the public.”[319]
In addition, the APA requires that,
“[u]pon the request of any person, and as soon as feasible and to the extent
practicable, each agency shall adopt rules to supersede those principles of law
or policy lawfully declared by the agency as the basis for its decisions in
particular cases it intends to rely on as precedents in future cases.”[320] Finally, as emphasized above, the PWA invests
rulemaking authority only in DOLI, and part 5200.1030 of DOLI’s PWA rules requires
that, after reviewing and certifying the appropriate wage rate, the
Commissioner of DOLI “must” take action “within 90 days” to “initiate the
rulemaking procedure so that the classification will be defined in the Master
Job Classifications” set forth in part 5200.1100.
If an agency fails to comply with required rulemaking procedures, its improper “rule” is considered invalid.[321] For example, in Sa-Ag, Inc. v. Minnesota Department of Transportation,[322] the Minnesota Court of Appeals held that Mn/DOT’s issuance of an addendum to all bidders on state contracts, which purported to interpret the term “substantially in place” as used in the PWA and identify which haulers of sand and gravel would have to adhere to prevailing wage rates, constituted unauthorized rulemaking. The Court held that the addendum was an agency statement of general applicability and future effect and, because the term was subject to more than one interpretation, the addendum amounted to an interpretive rule that needed to be adopted pursuant to Minnesota APA.
The record in this case supports
the conclusion that Mn/DOT did, in fact, engage in unauthorized rulemaking rather
than case-by-case determination in applying the PWA to HTPO’s surveyors. The DOLI rules under the PWA that were
in existence at the time ZRC entered into its prime contract with Mn/DOT and
HTPO entered into its subcontract with ZRC made no attempt to define either the
overall reference to “laborer”[326] or the
specific reference to “Laborer, common (general labor work).”[327] Based
upon the record of this proceeding, it is clear that there was no single,
commonly held understanding that surveying tasks were included within the
“Common Laborer” classification. Neither
the DOLI rules nor the prime contract for the TH 212 Project that was
incorporated into HTPO’s subcontract included any wage rates for surveyors or
described the “Common Laborer” classification as including survey tasks.
Starting in approximately 2003 with Mr.
Groshens’ letter to Mark Dierling of Short Elliott Hendrickson Inc., Mn/DOT
began to interpret the PWA more broadly than the federal Davis Bacon and
Related Acts and require more generally that surveyors be paid prevailing wages
in the appropriate labor classification as determined by the contractor. Mn/DOT supplied a “wish list” to DOLI later in 2003
requesting that surveyors be given a separate classification by DOLI or that
language be added to include them in existing classifications. Despite the fact that DOLI did not actively
proceed to adopt such a rule, Mn/DOT thereafter applied its broader
interpretation of the applicability of the PWA to surveyors (supported by Mr.
Oelker’s informal “concurrence” in its classification determinations) across
contractors and subcontractors and gave those determinations future
effect. The record demonstrates that
Mn/DOT applied
its more expansive interpretation of the requirements of the PWA to several
survey firms after 2003, including Yaggy Colby in 2006, HTPO and EVS in 2007, and Rani Engineering in
approximately 2008. Mn/DOT ultimately determined in each instance that at least
some of the work performed by survey crews working for those firms was subject
to the PWA. Mn/DOT treated the surveyors employed
by Rani Engineering as Skilled Laborers, and the surveyors employed by the
other firms as Common Laborers. The June 19, 2007, letter issued by Mr. Richards regarding Mn/DOT’s view
that HTPO survey crews were covered under the PWA was virtually identical to June
7, 2007, letter issued by Clancy Finnegan (another Mn/DOT investigator) to EVS
and the City of Bloomington regarding another project, and a June 25, 2007,
letter issued by Mr. Richards to EVS regarding its work on the TH 212 Project. The issuance of nearly identical conclusions
involving three separate situations supports the view that Mn/DOT was applying
a rule that should have been developed by DOLI through rulemaking, and was not
engaging in a case-by-case, fact-specific determination.
Moreover,
based upon testimony elicited at the hearing, it appears that Mn/DOT’s position
that the PWA applies to all survey crew members regardless of the type of work
they perform is not shared by DOLI. For
example, in response to an inquiry from Rani Engineering in March 2008, Mr.
Oelker of DOLI confirmed that the PWA only applies to survey crew members who
primarily perform manual work.
Similarly, a DOLI employee answering an information line identified in
the ZRC contract as the number to call for questions about prevailing wage
rates informed HTPO in February 2009 that the PWA would not apply if the survey
worker was holding a transit, but would apply if the worker was pounding
stakes.
There
is no showing that Mn/DOT made any effort to provide contractors with notice of
changes in its interpretation of the PWA, or of the manner in which its
interpretation differed from that of DOLI.
Although the 1998 and 2005 Technical Memoranda issued by Mn/DOT
discussed certain issues regarding payment of construction surveyors, neither
Memorandum stated that survey crews would have to be paid prevailing wages
under the PWA, or discussed any labor classification that would apply to
them. Mn/DOT did not discuss PWA
requirements for surveyors in pre-bid meetings or include any statement in its
2005 contract with ZRC about these changes, despite its ability to do so.[328] Mn/DOT also did not otherwise publicize prior
to 2005 the fact that it had interpreted the PWA to apply to members of survey
crews regardless of the performance of manual labor and had determined on
several occasions that surveyors’ work was most similar to the Common Laborers
classification. And, as discussed above,
Mn/DOT did not ensure that DOLI complied with the directive in Minn. R.
5200.1030 that rulemaking be initiated within 90 days to define the survey
technician classification in the Master Job Classifications set forth in Minn.
R. 5200.1100.
The conclusion that Mn/DOT
engaged in unauthorized rulemaking rather than case-by-case determination is
also supported by the very limited nature of the investigation conducted by
Mn/DOT with respect to HTPO. Case-by-case
adjudication by administrative agencies generally requires the application of
an extrinsic source of law (either a statute or regulation) to the facts of the particular case.[329] In this matter, there was very little effort by
Mn/DOT to determine the facts relating to the nature of HTPO’s work on the
Project. The Mn/DOT investigator admitted that he observed HTPO employees on the
Project for only very brief periods of time on a limited number of occasions and
he did not interview HTPO or other surveyors to ascertain the nature of the
work they performed on the Project. He
also acknowledged that he was unfamiliar at the time with the Total Station
used by HTPO crews. Mn/DOT also made only
a limited attempt during its investigation to determine the facts
relating to the training of Common Laborers and the nature of the work they perform. There
is no evidence that Mn/DOT contacted individuals conducting the training in the
laborers’ apprenticeship program to obtain specific information about the
“instruments” and “line and grade” courses.
The Mn/DOT investigator erroneously assumed and told Mr. Oelker that 160
hours of instruction in field surveying tasks were “required” as part of the
apprenticeship program. Mn/DOT’s
witnesses were unable to explain in any detail how the tasks performed by Common
Laborers on state construction projects were similar to tasks performed by
HTPO’s survey crews. Rather than
engaging in a case-by-case determination regarding coverage of HTPO surveyors under
the PWA based upon the particular work they performed in a particular situation,
it appears that Mn/DOT merely sought to establish a more general
proposition not found in existing statute and rule that it would also apply in
future cases. Such an approach requires
rulemaking which, under the PWA, can only be conducted by DOLI.
DOLI’s recent rule amendments adding a new job classification for survey field technicians were not effective until March 2009, and thus are not applicable here. However, comments made by DOLI during the rulemaking proceeding provide further support for the conclusion that Mn/DOT’s enforcement action in this case amounts to unauthorized rule making. As noted above, counsel for DOLI admitted during the rulemaking hearing that a separate classification for survey field technician had been included in the rules at Mn/DOT’s request because those workers “need to be covered by a labor class and--or by a job classification, and they probably really need to have one of their own because they’re significantly different than the other classes . . . .” It is evident that DOLI, the agency that is entrusted with authority to promulgate rules under the PWA, did not believe that it was clear or obvious that survey field technicians should be encompassed within the Common Laborers’ classification.
Mn/DOT’s
contentions about the amount of back wages owed by Respondents also underscore
that it is applying unpromulgated policies in this case that are not of a
longstanding nature rather than applying the PWA and the DOLI rules that were
in existence at the time. Mn/DOT
asserted on the last day of the hearing and in its post-hearing briefs that it
should be permitted to recoup back wages under the PWA for all work performed by
unlicensed survey employees of HTPO (regardless of whether performed on-site or
off-site, and regardless of whether it involved design work or survey work in
aid of construction activities).[330]
Generally, in assessing
whether an agency has engaged in a permissible interpretation of existing law rather
than improper application of an unpromulgated rule,
Mn/DOT’s argument in this
case that the PWA extends to both on-site and off-site work by surveyors does
not fall within the plain meaning of the DOLI rule which defines “work under
the contract” to encompass “construction
activities associated with the public
works project.”[333] At a minimum, the DOLI rule would appear to
be susceptible to more than one interpretation, similar to the situation
involved in the Sa-Ag case[334]
in which Mn/DOT was found to be engaging in unauthorized rulemaking.
Even if the DOLI rule
were viewed as ambiguous in nature, the interpretation that Mn/DOT is
attempting to apply here is not one that it has consistently applied over a
lengthy period of time. In fact,
Mn/DOT’s contention in the current case is at odds with its determinations in
various other investigations regarding what particular work performed by
surveyors is covered under the PWA. For
example, the prevailing wages that Mn/DOT required Rani Engineering pay to its
surveyors on the I-35W bridge project were limited to work performed on site
and did not extend to time spent in the office.
Mn/DOT did not require all of the on-site land surveying activities
conducted by the Yaggy Colby surveying firm to be subject to the PWA when it calculated
the amount of back wages owed on the ROC 52 project in 2006. Mn/DOT excluded from that calculation the
portion of Yaggy Colby’s work related to design rather than construction based
on a determination that the design work was not “work under the contract,” and it
did not require the time spent by Yaggy Colby on “as built” measurements to be
covered by the PWA. Moreover, Mr.
Groshens told HTPO during two meetings in 2008 that prevailing wages only
applied to work performed on-site, and Mr. Richards’ hearing testimony in the
present case reflected a view that prevailing wages should not be
imposed for design or office work. There is no
evidence that Mn/DOT has ever before demanded that surveyors be paid prevailing
wages for their time spent in the office.
Because the interpretation Mn/DOT is seeking to apply here is not
consistent with the plain language of the DOLI rule or the agency’s
longstanding practice, it provides further evidence that Mn/DOT is attempting
to apply an unpromulgated rule.[335]
For all of these reasons, the Administrative Law Judge concludes that Mn/DOT has engaged in unauthorized rulemaking in this matter, rather than case-by-case adjudication.
D. Mn/DOT Failed to Carry its Burden to
Show by a Preponderance of the Evidence that Common
Laborer was the Most Similar Trade or Occupation
As
discussed above,
Mn/DOT asserts that Mr. Richards’ testimony about the steps he took
during his prevailing wage investigation shows that the Common Laborer
classification was properly identified as being the most similar to the work
done by HTPO survey crews.[336] In contrast, Respondents contend that
the testimony of Mn/DOT’s witnesses did not demonstrate that the Common Laborer
classification is the most similar trade or occupation to the work performed by
HTPO employees. If the PWA is found to
apply to HTPO’s workers, Respondents further argue that the Landscape Laborer
classification should be applied because Landscape Laborers’ work is just as
similar to the surveying work done by HTPO and the prevailing wage rate
required for Landscape Laborers is more comparable to the wages that were paid
by HTPO to its survey crews.[337]
Mr. Richards has never worked as
a land surveyor or operated a Total Station or other equipment used by
surveyors, and did not interview HTPO surveyors or consult with any land
surveying professionals in reaching this determination. He estimated that he visited the Project only
two or three times for at least one hour each time, and admitted that he looked
over the entire Project during those visits.
There is no evidence that Mr. Richards interviewed laborers or observed
them at length to ascertain what tasks they performed that were similar to
those performed by HTPO surveyors. Mr.
Richards had some experience working
as a laborer in the construction industry many years ago, between 1965 and
1973. He testified that he believed that
Common Laborers’ tasks included such tasks as surveying, holding a rod and a tape measure,
running a transit, clearing brush, putting in grade stakes, blue topping, and
staking for watermains, bridges, concrete, bituminous, sewer lines, berms, and
noise walls. However, the basis for this testimony was cast into
doubt by his later acknowledgement that he was not qualified to specifically describe
the tasks performed by Common Laborers that are similar to those performed by
field survey crews:
Q
[by counsel for Respondents] And I am
trying to get at the nature of the field surveying they [Common Laborers]
do. It sounds like you’re not qualified
to tell us about that; is that right?
A
[by Mr. Richards] No, I am not qualified
to tell you what they do. I just referred
to the Book of Occupational Titles for surveyor and for laborer, and there are
similar definitions; and apprenticeship agreements, which is one of the things
Labor and Industry looks at, and there is a considerable amount of time spent
teaching them surveying. I haven’t gone
to their school. I only take their
documents for what they are worth.[338]
The actual apprenticeship agreements were
not offered into evidence by Mn/DOT.
Mr. Richards testified that he
relied primarily on the laborers’ apprenticeship agreements and the “Book of
Occupational Titles” in reaching his conclusion about what wage rate to
assign. Because apprenticeship
agreements typically do not describe the scope of the course but simply list the
type and name of the course,[339]
Mr. Richards’ review of those agreements does not provide a persuasive
foundation for his assertions about the surveying tasks performed by
laborers. In addition, Mr. Richards
mistakenly believed that the apprenticeship agreement for the laborers union
required that individuals receive 160 hours of training in field surveying, and
told Mr. Oelker that the apprenticeship program that was created by DOLI for
laborers included “required” training on surveying work. In fact, the apprenticeship program merely
offered 40 hours of elective training in “instruments” and 40 hours of elective
training in “line and grade.” The
misinformation that apparently was provided to Mr. Oelker about the nature of
the laborers’ training undermines the weight to be given to the informal concurrence
given by Mr. Oelker.
As noted in the Findings, Mr.
Richards’ testimony that he relied on the Dictionary
of Occupational Titles in assigning a wage rate is not credible in light of
Mn/DOT’s admissions to the contrary. His
further allegation that there are similar definitions in the Dictionary for surveyor and laborer and
that both definitions encompass rodmen, transit men, people with computer tape
equipment, and those who clear brush and pound stakes also lacks
credibility. If the Dictionary of Occupational Titles had
been reviewed by either Mn/DOT or DOLI, it
would have revealed that there is a considerable difference between the
descriptions of work performed by a “surveyor assistant” and that performed by
a “construction worker II” (the closest description to that of “laborer”). The position of “Surveyor Assistant,
Instruments” is classified as a professional position which involves obtaining
data pertaining to angles, elevations, points, and contours used for
construction or other purposes using a variety of surveying instruments (such
as Alidade, level, transit, plane table, Theodolite, and electronic distance
measuring equipment); compiling notes, sketches, and records of data obtained
and work performed; directing work of subordinate members of the team; and
performing other survey work as directed by the Party Chief. In contrast, the Dictionary of Occupational Titles defines “Construction Worker II”
as an individual who performs a variety of types of physical labor “requiring
little or no independent judgment,” such as digging, spreading, and leveling
dirt and gravel “using pick and shovel”; lifting and carrying building
materials, tools, and supplies; cleaning equipment and work areas; mixing and
spreading concrete and other materials, using handtools; and performing a
“variety of routine, nonmachine tasks.”
A number of designations are listed in the definition of Construction
Worker II relating to the specific work such individuals may perform. The listed designations include “Grader
(construction)” and “Grade Tamper (construction).” None of the listed designations refer to
“surveyor” or to survey work in any way.[340]
Other
witnesses called by Mn/DOT did not provide further clarity about the basis for
the agency’s position that the Common Laborer classification was the most
similar trade to surveyors. Jessica Looman, a staff attorney for the
Laborers District Council of Minnesota and North Dakota, stated during her
testimony that she was only “generally” or “somewhat” familiar[341]
with the two elective courses offered in the apprenticeship program that
related to survey skills (a 40-hour “instruments” class and a 40-hour “line and
grade” class). She was unable to
identify which instruments laborers are trained to operate in the instruments
course because she was “only familiar with the apprenticeship program as a
whole and not the individualized training.”[342] She also did not know how much of the time
spent in either of the two courses was devoted to classroom training as opposed
to practical, hands-on training,[343]
and agreed that it would be necessary to talk to the trainers to know the
particular tasks that laborers are trained to perform.[344] She has never worked as a laborer and did not
have firsthand knowledge of what tasks laborers actually performed in the
field.[345]
Charles
Groshens, Mn/DOT’s Investigation Supervisor, testified generally that he
understands Common Laborers perform demolition and traffic control work, set
blue tops, run string lines, rake asphalt, do clean-up work, set interlocking
blocks, and run mud trucks,[346]
but was unable to provide more detailed responses to questions about laborers’
tasks. For example, when asked whether a
Common Laborer establishing elevations for aggregate base basically used
elevations that had been given to them by a land surveyor, Mr. Groshens
admitted that he had “no idea” but “would assume so.” When asked if Common Laborers were “just
measuring,” Mr. Groshens responded, “I don’t know all the details of it, no”
and stated, “What I know today is that they do train their people to do
surveying. What aspects of it I have no
idea, and I don’t know how a surveyor sets up his marks or his stuff.”[347] He indicated that Mn/DOT was not contending
that the Common Laborers use a Total Station and a prism and derive elevations
from previously determined control points,[348]
but again emphasized, “I do know that the laborer classification does have
surveying and that kind of stuff in it.”[349] Mr. Groshens also testified that he did not
know what Mn/DOT looked at when it assigned a wage rate to HTPO’s field crews,
and specifically did not know whether Mn/DOT looked at the union collective
bargaining agreement or the Dictionary of Occupational Titles.
In
contrast, the Respondents’ witnesses offered credible testimony that very few
Common Laborer tasks are similar to the duties performed by HTPO’s
surveyors. Based upon that evidence and
the definitions in the Dictionary of
Occupational Titles, it is clear that, unlike surveyors, Common Laborers
typically perform physical labor on highway projects. In connection with that work, they may
perform simple measurements off of points previously located by land surveyors,
using rulers or levels, in order to determine the proper location for work they
are performing in the field, and may pound stakes or clear brush. They do not typically use a transit or other
instruments used by surveyors. The
Respondents also provided persuasive evidence that Landscape Laborers on
highway construction projects similarly measure off points established by land
surveyors, and that the tasks of Landscape Laborers are just as similar to
those performed by surveyors as the tasks performed by Common Laborers.
The Administrative Law Judge
concludes that Mn/DOT failed to bear its burden to show that the Common Laborer
classification was the most similar trade or occupation to HTPO’s
surveyors. The record as a whole simply
does not provide an adequate basis upon which one could reach such a
conclusion. Accordingly, in the event
that the Commissioner determines that the PWA properly applies in this case and
back wages are owed, it is recommended that the Landscape Laborer wage rate be applied
rather than the Common Laborer wage rate.
IV. Conclusion
Based upon the record as a whole, the
Administrative Law Judge finds that Mn/DOT failed to properly assign a wage
rate to the work performed by HTPO’s survey employees; DOLI failed to initiate
rulemaking to define the surveyor classification in the Master Job
Classifications within 90 days of the initial decision that surveyors were
subject to the PWA; Mn/DOT engaged in unauthorized rulemaking; and Mn/DOT
failed to carry its burden to demonstrate that Common Laborer was the most
similar trade or occupation. Accordingly,
the Administrative Law Judge concludes that Mn/DOT is not entitled to recover
back wages from ZRC or HTPO under the PWA.[350]
B.
L. N.
[1] The PWA is codified at Minn. Stat. §§ 177.41-177.44.
[2]
[3]
[4] 40 U.S.C. §§ 3141-3148. In addition to the Davis-Bacon Act itself, prevailing wage provisions have been added to approximately 60 laws involving federally-assisted construction projects. As a result, federal interpretations frequently refer to “Davis-Bacon and Related Acts” or “DBRA.” See, e.g., Exs. 104, 105.
[5]
[6] Minn. Stat. § 177.44, subd. 1.
[7] See, e.g., Minn. Stat. §§ 175.171(2) (granting DOLI general authority “to adopt reasonable and proper rules relative to the exercise of its powers and duties, and proper rules to govern its proceedings and to regulate the mode and manner of all investigations and hearings”); Minn. Stat. § 177.28, subd. 1 (authorizing DOLI to "adopt rules, including definitions of terms, to carry out the purposes of section 177.20 12177.44, to prevent the circumvention or evasion of those sections"); Minn. Stat. § 177.44, subds. 3 and 4 (directing DOLI to investigate and determine the classes of labor and prevailing wage rates for highway construction projects). DOLI’s administrative rules relating to the PWA are set forth in Minn. R. 5200.1000 - 5200.1120.
[8] Transcript (“T.”) 17-18, 69.
[9]
[10] Minn. Stat. § 177.44, subd. 7.
[11]
[12]
[13] 29 C.F.R. § 5.2(m).
[14] See, e.g., Minn. R. 5200.1100, subd. 2 (2007) (included in Ex. 103); T. 19.
[15] T. 19, 31; Ex. 103.
[16]
T. 33, 61; see Ex. 103. In March 2009, DOLI adopted an amendment to
Minn. R. 5200.1100, subd. 2, which established a new code number 110 for survey
field technicians. The amendment states
that Code No. 110 applies to “Survey field technician (operate total station,
GPS receiver, level, rod or range poles, steel tape measurement; mark and drive
stakes; hand or power digging for and identification of markers or monuments;
perform and check calculations; review and understand construction plans and
land survey materials). This classification does not apply to the work
performed on a prevailing wage project by a land surveyor who is licensed
pursuant to Minnesota Statutes, sections 326.02 to 326.15.” At the same time, subdivision 2 was also
amended to add new Code No. 111 for “Traffic control person (temporary
signage)” and new Code No. 112 for “Quality control tester (field and covered
off-site facilities; testing of aggregate, asphalt, and concrete materials);
limited to Minnesota Department of Transportation highway and heavy
construction projects where the Minnesota Department of Transportation has
retained quality assurance professionals to review and interpret the results of
quality control testers' services provided by the contractor.” These amendments to Minn. R. 5200.1100, subd.
2, became effective on
[17]
[18]
[19] Ex. 115 (emphasis in original).
[20] Ex. 115 (emphasis added).
[21] T. 187-90.
[22] T. 215-16.
[23] T. 75, 207-08, 343.
[24] Ex. 104 at 1-2; accord Ex. 105 at 2 and 3.
[25] Ex. 104 at 1-2.
[26]
[27]
[28] Ex. 104 at 2; see 29 C.F.R. 541.700 -541.701.
[29] T. 128, 148.
[30] T. 34, 128-29.
[31] T. 148.
[32] T. 37-39; Ex. 4.
[33] Ex. 4A; T. 488-94.
[34] T. 493-97; Ex.
132.
[35] T. 492.
[36] Ex. 4 at 8; Ex. 4A at 6.
[37] T. 272.
[38]
Ex. 1 at 1, 35; T. 20-22. A design-build
contract is one in which Mn/DOT enters into a contract with a general
contractor who, with the assistance of designers, project planners, and
subcontractors, designs the project from scratch (or based on partial plans
previously developed by Mn/DOT) and then builds the project. This differs from the traditional design-bid-build
contract, where Mn/DOT designs the plan and puts it out for bids, and
contractors submit bids based on Mn/DOT’s plans and specifications. T.
22, 162-63.
[39] T. 263, 270-71, 395.
[40] T. 654, 658-62; Exs. 107, 108.
[41] T. 653.
[42] T. 389.
[43] T. 392, 657.
[44] T. 270-71, 395.
[45] T 258, 261-62.
[46] T. 655.
[47] T. 390.
[48] T. 391-92, 655-57.
[49] T. 393, 656, 662.
[50] T. 392, 657-58.
[51] T. 393, 662-63.
[52] T. 263-64, 272-74.
[53] T. 274-75.
[54] T. 269; Ex. 101.
[55] T. 274-75, 586-88; Ex. 101 at HTPO 00355.
[56] Ex. 101 at HTPO 00351.
[57] Ex. 101 at HTPO 00351, 00352, 00355,
00357-00359; T. 272-73.
[58] T. 664; Ex. 101.
[59] T. 665-66.
[60] T. 758-59.
[61] Ex. 1 at F-4, p. 1.
[62] Ex. 1 at F-3; T. 24.
[63] T. 30-33; Ex. 1 at F-4; compare Minn. R. 5200.1100 (2007).
[64] T. 32-33.
[65] T. 33.
[66] T. 33, 61; Ex. 114.
[67] Ex. 1 at F-5. The Court of Appeals decision referenced in
the contract is discussed in Finding 120 below.
[68] T. 269.
[69] T. 706.
[70] T. 269-70.
[71] T. 270.
[72] T. 269-70.
[73] Ex. 36.
[74] T. 264.
[75] T. 56-57, 222, 293; Exs. 117 at 1, 125 at 2, 3.
[76] T. 306, 600; Ex. 125 at 2-3.
[77] T. 224-27, 305-06; Ex. 29.
[78] T. 308. “As-built” measurements are measurements
taken by surveyors to determine if the end result was different than the
original plan. Any changes are reflected
in the record.
[79] T. 298-300, 598-600; Ex. 125 (Ex. A).
[80] T. 234-35, 237, 289. Mn/DOT did not conduct an investigation of EVS, the other survey subcontractor on the TH 212 Project. The Project Engineer discussed the issue with EVS and EVS ultimately paid approximately $8,000 in back wages to employees who were determined to have been underpaid. T. 228-29, 330-31.
[81] T. 352-53.
[82] See T. 289, 314, 316.
[83] T. 78-79; Ex. 116 at 12 (Requests for Admission Nos. 5 and 6).
[84] T. 234-35, 312-13, 338.
[85] T. 236, 289, 339-40.
[86] T. 57, 290-91.
[87] T. 313.
[88] T. 291.
[89] T. 219-21.
[90] T. 339-42.
[91] T. 314.
[92] T. 235-36, 289. Mr. Richards had previously made the same recommendation regarding the ROC 52 project, and Mr. Oelker had also concurred with respect to that determination. T. 224-226.
[93] T. 300.
[94] T. 75-76, 208, 300.
[95] T. 207-08, 343.
[96] T. 310-11.
[97] T. 311.
[98] Ex. 3; T. 239-40.
[99] T. 239, 325-26.
[100]
T. 241, 245. Mr. Richards did not adjust
the wage rate upward as of
[101] T. 309.
[102] T. 309-10, 345.
[103] T. 544.
[104] T. 399.
[105] Ex. 24-H.
[106] Ex. 24-E.
[107] Ex. 24-F; T. 335-36.
[108]
Ex. 24-A; T. 658-62. See also Exs. 107 and 108. The practice of land surveying is the
application of the principles of mathematics and physical and applied sciences
and law to measuring and locating lines, angles, elevations, and natural or artificial
features. Minn. Stat. § 326.02, subd. 4.
[109] Ex. 24-B (also Ex. 109).
[110] Ex. 24-C.
[111] Ex. 26.
[112] T. 300-04; compare Ex. 26 with Exs.
121 and 27.
[113] 681 N.W.2d 706 (Minn. App. 2004).
[114] Ex. 27.
[115] Ex. 27 (also Ex. 111).
[116] Ex. 28 (also Ex. 112).
[117] Ex. 28 (also Ex. 113).
[118] T. 706-07.
[119] T. 619-20, 625-27. As explained more fully in Findings 125-26 below, the DOLI prevailing wage rule amendments effective in March of 2009 added a new code in Minn. R. 5200.1100, subp. 2 (2009) under the “laborers” classification for “quality control testers” and the Requests for Comments issued by DOLI in 2004 and 2006 indicated that DOLI was considering creating new classes for or altering the classifications applying to “quality testers.” As a result, quality control testers were in a situation similar to that of survey technicians.
[120] T. 621.
[121] Ex. 127; T. 621-22.
[122] T. 623-24.
[123] Ex. 128; T. 623-24.
[124] T. 158-59.
[125] T. 139.
[126] T. 164-65, 831-32.
[127] T. 140.
[128] T. 140-41.
[129] T. 141-43.
[130] T. 160-61.
[131] T. 400-03, 446-49, 830-31, 840.
[132] T. 400-01, 403, 448-49.
[133] T. 413-54.
[134] T.
417-19.
[135] T. 420-21.
[136] T. 421-23.
[137] T. 427-32.
[138] T. 427-32.
[139] T. 433-34.
[140] T. 439-42.
[141] T. 552, 562, 564, 613.
[142] T. 527.
[143] T. 540.
[144] T. 402.
[145] T. 830.
[146] Exs. 139-40; T. 459-60.
[147] Exs. 137-38, 145-46; T. 454-56.
[148] Ex. 144.
[149] T. 456-57.
[150] Ex. 141; T. 461.
[151] Ex. 138; 455-57.
[152] T. 441-45, 463-85, 830-31.
[153] T. 487-88, 723, 840-41.
[154] Ex. 129; T. 463-64.
[155] T. 464-66.
[156] T. 466-67.
[157] T. 467-68.
[158] T. 468-71.
[159] T. 471-72, 414-47.
[160] T. 472-73.
[161] T. 473-74.
[162] T. 474.
[163] T. 474-75.
[164] T. 475-77.
[165] T. 417-20, 477-78.
[166] T. 478-79.
[167] T. 479-80.
[168] T. 480-81.
[169] T. 481-82.
[170] T. 482.
[171] T. 477.
[172] T. 482-85.
[173] T. 359, 361.
[174] T. 360-63, 493-94; Exs. 132, 133.
[175] T. 362-63.
[176] T. 363-65, 369-72.
[177] T. 367, 376-77.
[178] T. 375.
[179] T. 369, 371.
[180] T. 379.
[181] T. 379-80.
[182] T. 369-70.
[183] T. 494-97; Ex. 132 at HTPO01036, 01037,
01045; Ex. 133.
[184] T. 497-98.
[185] T. 496-97.
[186] T. 557-58.
[187] T. 610-13.
[188] T. 645.
[189] T. 609-11.
[190] T. 452-53.
[191] T. 611-12.
[192] T. 611-13.
[193] T. 81-83, 99-100, 288-90, 328-30.
[194] T. 81-82, 328-30.
[195] T. 720-22; Ex. 151.
[196] T. 12-16.
[197] Ex. 1 at F-2, ¶ A-6; T. 26.
[198] T. 605-06.
[199] Ex. 33.
[200] T. 499-500.
[201] T. 118.
[202] T. 505-06.
[203] T. 500-02; Ex. 130.
[204] T. 332-33; Ex. 125, Ex. D.
[205] T. 502-05; Ex. 131 (grades 10 and 12).
[206] T. 333-35; Ex. 126.
[207] Ex. 18.
[208] Id.; T. 100-02.
[209] Ex. 19.
[210] Exs. 10, 11, and 12.
[211] Ex. 12 at 46-51.
[212] Ex. 12 at 46-47, 48; T. 111-13.
[213] Ex. 105 at 2, 3.
[214] Exs. 20 and 21 (see also Ex. 122).
[215]
The U.S. Department of Labor’s Field Operations Handbook stated, “The
determination as to whether certain members of survey crews are laborers or
mechanics is a question of fact. Such a
determination must take into account the actual duties performed. As a general matter, instrumentman or
transitman, rodman, chainman, party chief, etc., are not considered laborers or
mechanics. However, a crew member who
primarily does manual work, for example, clearing brush, is a laborer and is
covered for the time so spent.” Ex. 15,
Field Operations Handbook,
[216] Ex. 20.
[217] Ex. 21.
[218]
[219] T. 51.
[220] T. 125.
[221] Ex. 16; T. 44-48.
[222] Ex. 5 at 2; T. 152.
[223] Ex. 5 at 2.
[224]
[225]
[226] T. 510-11.
[227] Ex. 104.
[228] Id.
[229] Ex. 135 at MDOT00199-00200.
[230] Ex. 135 at MDOT00200.
[231] Ex. 135 at MDOT00200-00201.
[232] Ex. 135 at MDOT00203-00204.
[233] T. 192.
[234] T. 192-93, 195.
[235] T. 594-95; Ex. 143 at section 7.4.3 (Employee Performance Requirements).
[236] T. 595, 792-93.
[237] Ex. 154; T. 675-77, 682.
[238]
[239] T. 790-94.
[240] T. 845-47.
[241] T. 793-94.
[242] T. 667-68, 670-71; Ex. 150.
[243] T. 668-69, 670-71; compare Ex. 150 and Ex. 1 at
F-4.
[244] T. 572-73.
[245] T. 568-69; Ex. 134.
[246] T. 569-70; Ex. 134.
[247] T. 668, 671.
[248] Ex. 136 at 2-4.
[249]
No. C6-97-1582, 1998 WL 74281 (
[250] See Finding 34.
[251]
[252] 1998 WL 74281 at 2.
[253]
L & D Trucking v.
[254]
[255]
[256]
24 State Reg. 396 (
[257]
26 State Reg. 107 (
[258] T. 183, 409-44; Exs. 9-12.
[259]
AAA Striping Service Co. v.
[260]
[261]
[262]
[263]
[264]
[265]
Ex. 9 (29 State Reg. 454 (
[266] Ex. 9.
[267]
31 State Reg. 91 (
[268] T. 39-44, 208-10; Report of the Administrative Law Judge regarding In the Matter of the Proposed Amendments to the Rules of the Department of Labor and Industry, Labor Standards Unit, Relating to Prevailing Wage Determinations, Master Job Classifications, Minnesota Rules Parts 5200.1030 to 5200.1100, OAH Docket No. 8-1900-19710-1 (Sept. 22, 2008) at 4-5, 7-9 (hereinafter referred to as “2008 Prevailing Wage Rule Report”).
[269] 2008 Prevailing Wage Rule Report at 7.
[270] T. 45-47; Ex. 16; Ex. 136 at 14; 2008 Prevailing Wage Rule Report at 4.
[271] Ex. 136 at 20.
[272] Ex. 13; T. 44, 185-86.
[273] T. 113-15, 200; Ex. 13 at 38-39.
[274] T. 187; Ex. 13 at 69-84; 2008 Prevailing Wage Rule Report at 22-24.
[275] 2008 Prevailing Wage Rule Report at 21, 26, 27, 29, 30.
[276]
[277]
33 State Reg. 1598 (
[278] Minn. R. 5200.1100, subp. 2 (as amended effective March 30, 2009).
[279] T. 116-18, 196-97.
[280] Notice and Order for Hearing at 1.
[281] Notice and Order for Hearing at 3.
[282] T. 780-83.
[283]
[284]
[285]
[286] Minn. Stat. § 177.44, subds. 3 and 4.
[287]
[288]
[289]
[290] Minn. Stat. § 177.44, subd. 7.
[291] T. 6-7.
[292] Minn. R. 1400.7300, subpart 5 (emphasis added).
[293] Mn/DOT’s Post-Hearing Memorandum of Law at 5.
[294]
[295] Respondents’ Post-Hearing Reply Memorandum at 2-4.
[296]
[297] Findings of Fact, Conclusions and Recommendation issued in In the Matter of the MnDOT Detroit Lakes Regional Headquarters, OAH Docket No. 8-3001-17706-2 (Sept. 28, 2009), at 38-39.
[298]
[299]
[300]
[301] Ex. 115, ¶ 018.167-034 (Surveyor Assistant, Instruments).
[302] Respondents’ Post-Hearing Memorandum at 24 (citing Merriam-Webster’s Collegiate Dictionary, p. 650 (10th Ed. 1993).
[303] Ex. 115, ¶ 869.687-026 (Construction Worker II).
[304]
[305] Respondents’ Post-Hearing Memorandum at 24-25.
[306]
[307] Minnesota Department of Transportation’s Post-Hearing Memorandum of Law (Mn/DOT’s Post-Hearing Memo) at 6-7.
[308] Mn/DOT’s Post-Hearing Memo at 6-8.
[309] (Emphasis added.)
[310]
[312] Black’s Law Dictionary (8th ed. 2004).
[313]
See, e.g., State v. Morgan, 235
[314]
[315] Ex. 116 at 12 (Requests for Admission Nos. 5 and 6). In light of these admissions by Mn/DOT, Mr. Richards’ testimony (see T. 289, 314, 316) that he reviewed the Dictionary during his investigation and determined that the definitions for surveyor and for laborer were similar cannot be credited.
[316]
AAA Striping Service Co. v.
[317] Ex. 13 at 38-39 (emphasis added).
[318]
[319]
[320]
[321]
See, e.g., White Bear Lake Care Center,
Inc. v.
[322]
447 N.W.2d 1 (
[323]
See, e.g., Bunge Corp. v. Commissioner of Revenue, 305 N.W.2d 779 (
[324] AAA Striping, 681 N.W.2d at 717.
[325] L&D Trucking, 600 N.W.2d at 736.
[326]
[327]
[328] For example, Mn/DOT did include a notice in its August 2007 contract for the I-35W bridge project that “[s]urveys performed to progress the construction activities on the project are covered by the contract labor requirements.” Ex. 143 at § 7.4.3. Mn/DOT could have stated in the prime contract for the TH 212 Project that surveys performed to progress the construction activities on the Project would be covered by the contract labor requirements, as it did in the I-35W bridge contract. Similarly, Mn/DOT could have provided additional information in the prime contract for the TH 212 Project about the types of work encompassed in the “Common Laborer” classification. Mn/DOT did not take either of these approaches in drafting the contract for the TH 212 Project. There was no attempt to notify either ZRC as the prime contractor or HTPO as one of the surveying subcontractors that prevailing wages were required for surveyors.
[329]
G. Beck et al.,
[330] Mn/DOT also submitted as an attachment to its post-hearing Reply Memorandum a 36-page document labeled Appendix A indicating that Respondents owe approximately $239,543 in back wages rather than its previous estimate of $207,671. Mn/DOT contends that Appendix A consists of information taken from testimony and various hearing exhibits and shows the office and field payrolls provided by HTPO by week and pay period. Respondents objected to the inclusion of Appendix A with the Reply Memorandum and urged that it be stricken. The Administrative Law Judge agrees that Appendix A amounts to a late-filed exhibit which should be considered stricken from the record.
[331]
G. Beck et al.,
[332]
[333]
[334]
Sa-Ag. Inc. v. Minnesota Dep’t of Transp.,
447 N.W.2d 1, 5 (
[335]
See, e.g., Wenzel v. Meeker
[336] Mn/DOT’s Post-Hearing Memo at 11.
[337] Respondents’ Post-Hearing Memo at 29-30.
[338] T. 314.
[339] T. 371.
[340] Ex. 115.
[341] T. 364.
[342] T. 371.
[343] T. 372.
[344] T. 371.
[345] T. 374-375.
[346] T. 130.
[347] T. 98.
[348] T. 97-98.
[349] T. 77-78.
[350] There is no need to reach
the Respondents’ further argument that the DOLI rules under the PWA are
unconstitutionally vague as applied here.
Moreover, whether or not Mn/DOT has engaged in arbitrary or capricious enforcement of the PWA is a
question to be determined in judicial review of a final agency decision, and is
not appropriately addressed by the Administrative Law Judge at this stage of
the proceeding. See Findings of Fact, Conclusions and Recommended Decision in In the Matter of the City of Lake Elmo’s
Comprehensive Plan, OAH Docket No. 1-7600-15193-3 (2003) at 20.