|
|
OAH 8-3001-17706-2 |
STATE OF
OFFICE OF ADMINISTRATIVE HEARINGS
FOR THE DEPARTMENT OF TRANSPORTATION
|
In the Matter of
the |
FINDINGS OF FACT, CONCLUSIONS AND RECOMMENDATION |
The above-entitled matter came on for an
evidentiary hearing before Administrative Law Judge Eric L. Lipman on June 8
through June 20, and June 23 through June 25, 2009. For 11 days the evidentiary hearing was held at
the Office of Administrative Hearings in
Michael A.
Sindt, Assistant Attorney General, represented the Minnesota Department of
Transportation, Office of Construction and Innovative Contracting
(“MnDOT-OCIC”). Thomas R. Revnew and Michael L. McCain,
Seaton, Beck & Peters, P.A., represented Comstock Construction,
Incorporated (“Comstock”). Cynthia B.
Jahnke, Assistant Attorney General, appeared on behalf of Minnesota Department
of Labor and Industry (“DOLI”).
STATEMENT
OF ISSUES
1. Does
MnDOT-OCIC have legal authority
to enforce the prevailing wage requirements under its contract for the Detroit
Lakes Regional Headquarters, Construction Project Number OOTZ1791B?
2. Did
Comstock err in the assignment of contract-related tasks to the particular job
classifications listed under Minn. R. 5200.1000?
3. How much, if any, back wages does
Comstock owe its employees?
The Administrative
Law Judge concludes that MnDOT-OCIC does have the authority to enforce
the prevailing wage requirements of
Based upon all of the testimony and exhibits, and the arguments of the parties, the Administrative Law Judge makes the following:
FINDINGS
OF FACT
CONTRACT
FORMATION:
1.
On or about August 17, 2000, Comstock and MnDOT
entered into a contract that involved adding onto and remodeling MnDOT’s
Detroit Lakes District Regional Headquarters.[1]
2.
The project had three key components: adding to,
and remodeling of, the
3.
The project involved a doubling of the facility
from approximately 70,000 square feet to 140,000 square feet. Further, the project permitted the agency to
address a number of then-existing building code issues as well as expand
functionality of the Regional Headquarters. This project was a complicated undertaking, which
combined into a single, integrated statement of work, six smaller renovation
projects.[3]
4.
The contract required Comstock to pay employees who
worked on the project prevailing wages that were consistent with
5.
By including the prevailing wage requirements in
its agreement with Comstock, MnDOT hoped to assure that persons who worked on
the project would receive the real value of the services that they performed.[5]
6.
The contract lists the master job
classifications and provides contractors with codes to use in classifying
work. The listing of job classifications
in the contract includes more than 140 distinct categories of work.[6]
7.
As part of the solicitation process, MnDOT-OCIC
included a schedule of prevailing wages for the period of contract
performance. These wage rates, issued at
the time of contract formation, were effective throughout the life of the
contract.[7]
8.
Under the terms of the MnDOT–Comstock contract,
Comstock was required to submit certified payroll reports to MnDOT-OCIC, and to
make certified payroll records available within three business days, if so
requested by agency officials. The
payroll records were to contain, among other things, the employee’s name,
applicable classification codes under the prevailing wage law, hourly wage
rates, and daily and weekly hours worked in each job classification.[8]
9.
Notwithstanding the requirement that the awardee of
the contract pay wages that were then-prevailing for work within particular job
classifications, there are no provisions of the contract that require the
awardee to use only union-affiliated laborers or craftsmen when completing the
contract work.[9]
10.
Similarly, there are no provisions of the contract
which require the awardee to classify as a skilled craftsman only those
employees who earlier completed a union-affiliated apprenticeship program in
the particular trade.[10]
11.
Approximately eighty-five percent of the work that
Comstock has performed in
THE
PREVAILING WAGE SYSTEM IN
12.
In Greater Minnesota, both union-affiliated and
non-union “Merit Shop” contractors use a mix of laborers and skilled craftsmen
to accomplish the completion of contract work.
The ratios of skilled craftsmen to unskilled workers will vary in
particular settings depending upon the complexity of the contract work and the
relative experience of the unskilled laborers in the “crew.”[12]
13.
Comstock and other contractors in Greater Minnesota
refer to the combinations of laborers and skilled craftsmen as the “crew mix”
for a particular task.[13]
14.
In Greater Minnesota, Union contractors and Merit
Shop contractors compete on the basis of being able to skillfully apply a mix
of construction experience and trade skills to the completion of contract
work. The clever and profitable
contractor, whether it is affiliated with unionized tradesmen and laborers, or
not, will attempt to increase its profit margin by using lower-cost, common laborers
in the place of higher-cost, higher-skilled tradesmen, whenever it is
appropriate to do so. By segregating out
those elements of the contract work which do not require special skills or
training to complete, and assigning these tasks to unskilled laborers,
contractors are able to accomplish the contract work at a lower overall cost.[14]
15.
This practice is not without controversy or its
critics. A key point of contention is
whether the handling of materials used by skilled tradesmen may be undertaken by
an unskilled, common laborer.[15]
16.
The customs and practices of the construction
industry are different in the
17.
Minn. R. 5200.1040 provides 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.[17]
18.
Minn. R. 5200.1040 further provides that when
establishing a new class of labor, the Department of Labor and Industry 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]
19.
No Major Job Classification in Minn. R. 5200.1100
includes a definition of the scope of work that is encompassed by the
classification.[19]
20.
There are, from time to time, disputes amongst
trade unions as to which craft should have the opportunity to perform certain
construction-related work.[20]
21.
As new products are introduced into the
construction industry – particularly those that blend together the methods of
different trades – earlier-established lines of demarcation between skilled
crafts can become blurred and indistinct.[21]
22.
In general, trade unions in
23.
Among tradesmen in the construction industry there
is general knowledge as to scope of work under each of the Major Job
Classifications, but the text of Minn. R. 5200.1100 is not specific enough to
resolve difficult classification cases.[23]
24.
Government officials concede that classification of
a particular employee’s work is difficult when two different trade unions claim
the very same duties.[24]
25.
Roxanne Wilder, the principal labor inspector on
MnDOT-OCIC building projects, summarized the uncertainty as to the meaning of
the regulations in this way:
Many
classification descriptions include general information and are not specific –
each specific trade wants to have jurisdiction over as many tasks as
possible. Defined and undefined
jurisdiction may vary by area of the
Thus, even amongst those administering the
state’s labor standards, there is general uncertainty as to the scope and
meaning of the Major Job Classifications.[25]
26.
Persons who are knowledgeable about construction
practice in
27.
The Dictionary of
Occupational Titles is a useful general reference source as to the
duties that are undertaken in the construction trades, but its many hundreds of
classifications for the construction industry do not align well with the
smaller number of categories in the Master Job Classification list.[27]
28.
Whenever she is uncertain as to how to classify a
particular task in the construction industry, it is Ms. Wilder’s practice to
seek clarification from DOLI officials as to the proper job classification.[28]
29.
When
resolving disputes as to the proper classification of workers in the
construction trades, DOLI officials attempt to make determinations based upon
the duties of the workers.[29]
30.
The informal determinations rendered by DOLI
officials on classification issues are enforced by MnDOT-OCIC.[30]
31.
While DOLI asserts that there are no “specific
position descriptions for workers performing on state funded projects” in
Minnesota statute or rule, in practice, labor investigators in both MnDOT-OCIC
and DOLI fill gaps in the regulations by applying the terms of other, earlier
informal determinations. Labor investigators
in DOLI and MnDOT-OCIC save paper copies of informal job classification
determinations made by DOLI and apply the terms of these earlier determinations
to current contracts.[31]
32.
As Ms. Wilder described in an October 12, 2005
electronic mail message to Erik Oelcker, Senior Labor Investigator for DOLI:
I based my
decisions or assignments on your previous responses to our requests. Each time you send a response, I add what you
decided to a running document of classification descriptions since we have
nothing formal. It is the only way we
can keep track of what tasks are applied to each task.[32]
33.
Further, while labor investigators are scrupulous
in characterizing their use of prior determinations as “reference materials” only,
the manner in which these materials are used makes clear that that earlier
determinations are applied as if they were formal rules. The privately-maintained collections of
earlier agency statements are given general applicability and future effect so
as to make specific the law that is enforced by DOLI.[33]
34.
The Labor Compliance Unit of MnDOT-OCIC undertakes
approximately 300 labor investigations each year – from minor compliance
actions to larger scale investigations.[34]
35.
Labor investigator caseloads, on average, include
approximately 50 active investigations at any one time.[35]
36.
Charles Groshens, Senior Labor Investigator at
MnDOT-OCIC, testified that approximately ninety-five percent of the enforcement
problems arise out of the lack of clear definitions of the classification
standards. Most cases within the Labor Compliance Unit
settle without litigation.[36]
37.
Ms. Wilder was hired in 1998 to do labor compliance
for the building section of MnDOT-OCIC.[37]
38.
Ms. Wilder has a limited knowledge of construction
practice. While she has undertaken
coursework on soil testing and road finishing practice, she has not undertaken
any coursework in construction building practice or worked as part of a construction
team on a building project.[38]
39.
Ms. Wilder testified that with her case load of
building contracts to review, she is not able to review contractor submitted
payrolls as quickly as she would like.
It is not uncommon for there to be long delays in her completion of
reviews of contractor performance.[39]
CONTRACT
PERFORMANCE:
40.
Comstock began construction on the project on or
about September 5, 2000.[40]
41.
The
Statement of Work under the contract was structured so that MnDOT employees at
the Regional Headquarters site could undertake their regular work duties while
Comstock was undertaking demolition, site preparation or renovation work on
other portions of the site.[41]
42.
Phase I of contract performance was complete in May
of 2001. Phase II of contract
performance was complete in February of 2002.[42]
43.
The project was substantially complete in May of
2002. The final phase of contract
performance, Phase III, was
complete in July of 2002.[43]
44.
MnDOT-OCIC did not adduce evidence that any of the work
performed under the contract fell below either the standards for quality set
forth in the contract or the agency’s subjective expectations of acceptable
workmanship. Indeed, to the contrary,
agency officials expressed the view that Comstock did work of “very good
quality” on the regional headquarters project.[44]
45.
Employees of Comstock were obliged to complete
daily time cards reflecting the work performed at the job site. Employees were directed to list:
(a)
The employee’s name, the date and day of the week
on which work was performed;
(b)
the Job Number – in this instance, denominated by
Comstock project “2415”;
(c)
the name of the project;
(d)
the basic category of the work that was performed,
from among a series of “category codes” listed by Comstock on the time card;
(e)
the type of work performed by the employee;
(f)
the start and end times of particular tasks; and
(g)
the number of hours worked.[45]
46.
At the end of each work day, employees completed
the time card entries and deposited the completed forms in a specially-designated
box in the employee’s break room.[46]
47.
On a weekly basis, Kevin Koppang, Comstock’s
Project Manager on the Detroit Lakes project, reviewed the employee time cards
and assigned what he believed to be the appropriate three-digit prevailing wage
classification code to the work that was performed. Employees were then paid the corresponding
prevailing wage for the work that was completed. In support of its tabulations, Comstock
submitted a weekly certified payroll report to MnDOT-OCIC.[47]
48.
Additionally, Koppang drew out data from the job
category designations on the time card – sometimes adjusting the listed
designation to reflect the proper coding – for input into Comstock’s bid
estimation system. Comstock uses a
comparison of the hours that it earlier projected for each category of work,
with its actual later experience on the job, to refine and improve its bidding
estimation system.[48]
49.
MnDOT-OCIC reviewed payroll materials of building
contractors and subcontractors working under the contract so as to assure
itself that required wages, benefits and tax payments were promptly made.[49]
50.
As part of her duties, Ms. Wilder was on-site at
the Detroit Lakes Regional Headquarters twice following award of the contract
to Comstock. Ms. Wilder attended the
first Construction Meeting for the project, on September 26, 2000, and returned
in April of 2001 while contract performance was underway.[50]
51.
On September 27, 2001, Ms. Wilder sent Comstock a
letter stating that Comstock was in compliance with contract labor provisions
during the first 46 weeks of contract performance.[51]
52.
Mr. Groshens of MnDOT-OCIC concedes that it was
reasonable for Comstock to infer from the September 27, 2001 letter that
Comstock was in compliance with the labor standards of Contract Number 425783.[52]
53.
At the time of its receipt of the September 27,
2001 letter, a significant amount of work under the contract had been
completed.[53]
54.
Based upon the September 27, 2001 letter, Comstock
officials continued to classify and pay its employees as it had from the
beginning of contract performance.[54]
55.
Pursuant to a set of instructions from Ms. Wilder,
in the autumn of 2001, wage payments to subcontractor employees under the
contract were routed to MnDOT-OCIC instead of being remitted directly to the
employees. By early 2002, a collection
of these payments was in still the possession of MnDOT-OCIC – placed in a
drawer by Ms. Wilder and forgotten for several months.[55]
56.
A Contract Administrator, Jodi Alfson, wrote and
telephoned Ms. Wilder about the release of the checks, but received no reply.[56]
57.
On February 15, 2002, Kevin Koppang of Comstock
made inquires about the delayed release of subcontractor wage checks. In a tone of genuine urgency, Koppang wrote:
This needs to get
resolved immediately…. Our
subcontractors Blahna and McArthur are threatening that they won’t return to
the jobsite to continue with their work until the issue with these checks [is]
resolved. This would obviously hold up
progress if this would happen…. Your immediate attention to this matter would
be greatly appreciated as this issue has been on the table for an extraordinary
amount of time.[57]
58.
In reply, on February 19, 2002, Ms. Wilder
apologized for the three-month delay in remitting the sums owed to the subcontractor
employees. In this same correspondence,
Wilder states that there are deficiencies with Comstock’s payment
practices. Wilder writes:
I also need to let
you know that I have a problem with the information received from Comstock –
some of the time cards identify work performed that is inappropriately
classified and inappropriately paid – some are correctly classified and
incorrectly paid – please begin review of your time cards against your payment
records so that we can address and correct these issues soon ….
Ms. Wilder’s reply does not detail which
employees’ work was correctly classified nor does it identify which employees’
work was incorrectly classified.[58]
59.
MnDOT-OCIC’s claim that Comstock employees had been
inappropriately classified and paid is made for the first time four days after
Mr. Koppang demanded that MnDOT-OCIC release the paychecks due to the
subcontractor employees.[59]
THE
EXCHANGE OF INFORMATION BETWEEN THE PARTIES REGARDING PROPER CLASSIFICATION
PRACTICE:
60.
MnDOT-OCIC officials concede that they have a duty
to detail any non-compliance if the agency claims that a contractor has not met
the requirements of the prevailing wage law.[60]
61.
Ms. Wilder’s electronic mail message of February
19, 2002 does not detail what contract work was underpaid.[61]
62.
Ms. Wilder testified that she sent a letter
describing the shortcomings in Comstock’s allocation of assignments among job
classifications in July of 2002.
Comstock officials disclaim ever having received such a letter.[62]
63.
Ms. Wilder claims that the partially-complete,
unsigned, non-letterhead version of a letter dated July 11, 2002 (included in
the hearing record as Exhibit 707), was sent to Comstock officials. This item directs Comstock to remedy “all
violations indicated,” but, unlike the descriptions regarding Comstock’s
subcontractors, does not list any violations relating to Comstock. Wilder explains that she orally detailed
those shortcomings to Contract Administrator Joni Alfson. Ms. Wilder’s testimony on this point is
simply not credible.[63]
64.
The better and internally-consistent explanation is
that the letter dated July 11, 2002, was a draft that was neither completed nor
sent by Ms. Wilder to Comstock in the summer of 2002. Viewing this exhibit to be an uncompleted
draft, explains why there is missing detail as to the nature of the claimed
labor standards violations by Comstock; why (unlike other contemporaneous
documents from MnDOT-OCIC) there is no signed, letterhead version of this item
in the hearing record; why, despite the claim that a carbon copy of this letter
was circulated to ten different government officials, MnDOT-OCIC only has a
draft version of the letter in its possession; and why Comstock officials never
received this letter in 2002.[64]
65.
On a number of occasions in 2002 and 2003, Comstock
staff asked Ms. Wilder to identify the specific claimed prevailing wage
law violations – namely, which tasks had been improperly classified by the firm.[65]
66.
In a letter dated October 13, 2003, Ms. Wilder
directed Comstock to either: (a) submit all of its cancelled employee
paychecks, check ledgers and employee timekeeping records for each employee to
MnDOT-OCIC; or (b) “conduct a self audit” and submit the results for Ms.
Wilder’s review.[66]
67.
Between the two alternatives, Comstock chose to
conduct a self-audit. During this
process, Comstock officials reviewed employee time cards, daily reports and
payroll reports for all of the employees who worked on the Detroit Lakes
Project.[67]
68.
While conducting the self-audit, Comstock asked Ms.
Wilder for a list of claimed violations along with a list of governing labor
classifications. Comstock sought to use
the official materials in completing its review.[68]
69.
On November 13, 2003, Ms. Wilder responded to Comstock’s
request by stating that she would fax to Comstock a compilation of
classification determinations received by MnDOT-OCIC from DOLI. Ms. Wilder cautioned, however, that the
determinations that she was transmitting were not found in either a statute or
a rule, and should only be used “for reference” by Comstock.[69]
70.
In a facsimile transmission of the same day, Ms.
Wilder forwarded to Comstock an informal compilation of job classification
determinations that had been rendered by Erik Oelker, Senior Labor Investigator
of DOLI, in the past. The compilation
bore the following legend at the bottom of each page:
NOTE: This document is to be used for reference
only. Information included is a
compilation of many but not all of the determinations made by the Department of
Labor and Industry (DOLI) in response to specific questions of work
classification requirements for specific projects. Not all definitions of work classifications
are included. Questions regarding tasks
not included in this document should be presented in writing to the Department
of Transportation for determination by DOLI.[70]
71.
As instructed, Comstock requested guidance in
interpreting the distinctions between major classifications in four problem
areas under the contract: (1) the
distinction between “common laborers” and “skilled laborers”; (2) the
distinction between laborers and skilled tradesmen; (3) the scope of duties of
an “ironworker;” and (4) the scope of duties of a “carpenter.”[71]
72.
The complete reply of Mr. Oelker of DOLI on these
questions was as follows:
Per your
correspondence of December 1, 2003, Minnesota Rules and Statutes do not provide
for specific position descriptions for workers performing on state funded
projects. The class of labor indicated
in the Major Job Classifications is based on common usage in the industry,
scope of work in union contracts, apprenticeship standards, and the U.S.
Department of Labor Dictionary of Occupational Titles, as provided in Minnesota
Rules which have the force and effect law.
The classification
of labor and prevailing wages are enforced by the contract agency that owns the
project on a case by case basis. Federal
projects where the federal wage rates are included have no effect [on] the
If a contractor
wishes to contest the determination of a contract agency in regard to
compliance, the contractor should go through the legal process provided through
the agency.[72]
73.
At the evidentiary hearing, Rosyln Wade, the
Director of the Labor Standards Unit of DOLI, acknowledged that Mr. Oelker’s
December 1, 2003 response letter to Comstock “doesn’t reply directly to the
contractor’s concerns.”[73]
74.
On February 13, 2004, officials of MnDOT-OCIC met
with representatives of Comstock at Comstock’s
75.
So as to avoid the expense of copying and
transmitting to MnDOT-OCIC all payroll records relating to the project, in June
of 2004, Comstock completed a “self-audit” of its classification practice; and
forwarded the audit results to Ms. Wilder.
When this report could not be located at the agency, a follow-on packet
was again sent to MnDOT-OCIC in November of 2004.[75]
76.
By way of a letter dated December 16, 2004, Ms.
Wilder wrote Comstock stating:
I am disappointed
that Comstock did not submit more detailed documentation for more payroll
periods than what I received….
I must ask that
the timekeeping records written by the employees for all project periods until
the end of June 2001. If I find that the
included work descriptions match the tasks performed by the classifications
included on the payroll reports, I will not ask for further documentation. If not, I will have to ask for all periods.[76]
77.
Believing that the time and expense Comstock had
invested to complete a “self-audit” of the payroll records was a fool’s errand,
particularly as Ms. Wilder had demanded large stores of documents, with the
further prospect that all payroll records would be sought, Kevin Koppang wrote
the Facility Program Director of MnDOT-OCIC, Richard L. Post. Koppang objected to Ms. Wilder’s demand that
additional records be copied and forwarded to her.[77]
78.
By way of a January 19, 2005 electronic mail
message to Mr. Koppang, Director Post was conciliatory. He acknowledges that “the system is
complicated at best and takes an inordinate amount of time to complete these
investigations,” but explains that he is “required to have clearance from our
Labor Compliance Investigator before I can release any remaining funds” under
the contract. In an effort to ease the
tensions between the parties, he proposes that Ms. Wilder again travel to
Comstock’s
79.
At the evidentiary hearing, Ronald Lagerquist,
MnDOT-OCIC’s architect on the project, conceded that it was inappropriate for
the agency to demand copies of employee time cards nearly two years after the
completion of the project work.[79]
80.
On February 16, 2005, Ms. Wilder was given complete
and unfettered access to the payroll-related records relating to the contract.[80]
81.
On June 21, 2005, Ms. Wilder provided Comstock with
formal determination of the amount of back wages owed. The determination stated that, as a result of
a series of prevailing wage violations, Comstock owed $113,138.88 in additional
wages.[81]
82.
Through the remainder of 2005 and through much of
2006, Comstock sought to have MnDOT reconsider its determination that back
wages were owed. Its attorneys wrote
letters to various agency officials; from Ms. Wilder up to then-Commissioner of
Transportation, Carol Molnau.[82]
83.
Having received a copy of the letter that Comstock
wrote to Commissioner Molnau, indicating that Comstock may pursue resolution of
its claims through litigation, Ms. Wilder sent an electronic mail message to
Erik Oelcker of DOLI. Ms. Wilder wrote
requesting a written statement in which Oelcker would assert that he agreed
with MnDOT-OCIC’s classification of tasks according to the “Classification
Identification List.” Ms. Wilder had
obtained the “Classification Identification List” in an earlier meeting with
Oelcker. Wilder requested this
documentation “for the file.”[83]
84.
On April 3, 2006, Ms. Wilder issued a determination
as to the amount of back wages owed by Comstock. In this determination, MnDOT-OCIC asserted
that Comstock owed $109,561 in additional wages for prevailing wage violations.[84]
85.
On August 10, 2006, Ms. Wilder issued another
determination as to the amount of back wages owed by Comstock. In this determination, MnDOT-OCIC asserted
that Comstock owed $111,428.11 in additional wages for prevailing wage
violations.[85]
86.
At the evidentiary hearing, a former aide to Ms.
Wilder, Susan Rousseau, testified that Ms. Wilder sent the August 10, 2006
determination to Comstock knowing that there were tabulation errors and
inaccuracies in the spreadsheet which buttressed MnDOT-OCIC’s demand for back
wages.[86]
87.
There
is no evidence in the record rebutting Ms. Rousseau’s testimony.[87]
88.
On September 22, 2006, MnDOT Programs Facilities
Director Richard L. Post issued an “Order Letter” demanding that Comstock pay
back wages in the amount of $111,428.41, or, within 20 days of receipt of the
letter submit a written request for an administrative hearing.[88]
89.
On October 10, 2006, Comstock requested a contested
case hearing as to these claims.[89]
90.
Before and after the commencement of the contested
case proceedings in this matter, MnDOT-OCIC had a number of determinations of
the amount of back wages owed. The
demands are as follows:
|
Date
of Demand |
Amount
of the Demand |
Exhibit |
|
June 21, 2005 |
$113,136.88 |
745 |
|
April 3, 2006 |
$109,561.18 |
756 |
|
August 10, 2006 |
$111,428.41 |
760 |
|
June 20, 2007 |
$114,065.47 |
763 |
|
October 23, 2007 |
$104,749.12 |
764 |
|
June 11, 2009 |
$98,772.38 |
Transcript at
630[90] |
91.
MnDOT-OCIC
has held $27,074.86 earned by Comstock under the contract pending a final
“close out” of the project.[91]
MnDOT-OCIC’S
CLASSIFICATIONS OF CONTRACT WORK:
92.
MnDOT-OCIC’s claim for back wages follows from a
series of inferences made by agency officials from Comstock time cards and
payroll records.[92]
93.
If, for example, a Comstock employee listed “rebar”
in the space on the time card provided for “Type of Work,” MnDOT-OCIC reasoned that
because the rebar is made of steel, and ironworkers work with steel, the work
listed for that day was properly characterized as “iron work.”[93]
94.
It is not clear from the time card entry “rebar”
whether the employee was unloading rebar, clearing away rebar from the
construction site or fastening rebar to a permanent structure – facts that
otherwise would be determinative of a proper classification of the employee’s
duties. Further, it is not uncommon in
the construction industry for a worker to inaccurately characterize the work
that he or she performed when later describing the day’s duties on a time card.[94]
95.
Over time, Ms. Wilder used four different versions
of the Classification Identification List authored by Mr. Oelcker to assign the
work of Comstock employees among the various job classifications in the
contract.[95]
96.
The “4th version of the task assignment
list” was developed in December of 2007 after MnDOT-OCIC officials met with
representatives of Comstock.[96]
97.
The Classification Identification Lists MnDOT-OCIC
used to assign Comstock employees to job classifications were issued, revised
and reformatted by state officials without rulemaking.[97]
98.
Ms. Wilder’s assignment of tasks to particular
classifications was not done contemporaneously with, or proximately in time to,
performance of the contract work.[98]
99.
Ms.
Wilder did not verify the accuracy of the descriptions made by Comstock
employees on their time cards.[99]
100.
During the process of assigning Comstock employees
to particular job classifications, Ms. Wilder did not know the skill level or
construction-related experience of any of the employees that she assigned to
job classifications.[100]
101.
When assigning workers to particular job
classifications, Ms. Wilder was not clear as to the level of effort that was
required to complete the work that she attributed to particular employees.[101]
102.
Ms. Wilder assumed, without knowing, that the
workers that she assigned to skilled crafts had the skills to complete the work
that was attributed to them.[102]
103.
Messrs. Bertek, Blazek, J. Davids, T. Davids,
Eddington, Hanson, Heitmann, Hendrickson, Lehmann, Miller, Muehlberg, Owens,
Rozic, Sauve, Siemieniewski and Van Winkle did not have the construction
skills, knowledge or experience to complete the skilled craft work that MnDOT-OCIC
attributes to them.[103]
104.
Tradesmen who are knowledgeable of practices in the
construction industry expressed doubt that anyone could, after contract
performance was complete, accurately assign workers to particular job classifications
based upon the descriptions that were made in employee time cards.[104]
105.
Beyond the minimal descriptions of the work on the
employee time cards and daily reports, MnDOT-OCIC does not have any evidence of
the work that was performed by particular employees. MnDOT-OCIC did not introduce any
contemporaneously-produced evidence – such as photographs, survey information
or affidavits from employees or other persons on the construction site – which
describes what was work was undertaken by Comstock employees on particular days.[105]
106.
The record does not include testimony from any
employee who worked on the project suggesting that his work was misclassified.
107.
There was no testimony from any other person who observed
the performance of the contract work detailing how the duties of Comstock
employees were misclassified.
108.
Neither the Labor Compliance Unit, nor Ms. Wilder,
had sufficient knowledge of what work had been performed by Comstock employees,
on particular days, so as to accurately assign work to particular job
classifications.[106]
109.
Ms. Wilder concedes that it was difficult for her
to classify work that had occurred at the
110.
In Greater Minnesota, laborers frequently handle
materials used by tradesmen in skilled crafts – including handling, delivering,
laying and tying rebar.[108]
111.
While the task of tying rebar is claimed by trade
unions representing ironworkers, as Mr. Koppang demonstrated at the evidentiary
hearing, aiming the braces of a “rebar gun” at the point of intersection
between two steel rods which have been placed at right angles to each other,
and pulling the trigger on the rebar gun, does not require the special skills
of an ironworker to accomplish.[109]
112.
During the evidentiary hearing, Ms. Wilder could
neither identify nor describe the proper use of a rebar gun.[110]
113.
Director Wade acknowledges that Comstock has a
legitimate complaint if MnDOT-OCIC classified the very same construction tasks
inconsistently during contract performance.[111]
114.
MnDOT-OCIC classified the description of work with
“footings” inconsistently – assigning similarly denominated work to the
classification for laborer, carpenter and ironworker.[112]
115.
MnDOT-OCIC classified the description of work with “metal
panels” inconsistently – assigning similarly denominated work to the
classification for sheet metal worker, carpenter and ironworker.[113]
116.
MnDOT-OCIC classified the description of work with
“metal decking” inconsistently – assigning similarly denominated work,
performed on or around the same days, by the same personnel, as carpentry,
sheet metal work and iron work.[114]
117.
MnDOT-OCIC’s classification of the installation of
“metal decking” as sheet metal work results in a lower classification and wage
rate than Comstock’s classification of this task as iron work.[115]
118.
MnDOT-OCIC classified the description of work with
“temporary shelters” inconsistently – assigning similarly denominated work to
the classification for laborer and sheet metal worker.[116]
119.
MnDOT-OCIC classified the description of work of
“reinforcing walls” inconsistently – assigning similarly denominated work,
performed on or around the same days, as cement masonry and iron work.[117]
120.
MnDOT-OCIC classified the “repair of a door,
because the cement mason screwed up” as Cement Masonry.[118]
121.
MnDOT-OCIC did not use a consistent practice of
apportioning the work when an employee placed more than one descriptor on his
time card.[119]
122.
MnDOT-OCIC attributed work on non-prevailing wage
projects as if it were contract related work that required the payment of
prevailing wages.[120]
DOLI’s
PARALLEL RULEMAKING PROCESS:
123.
In the late 1990’s, agency officials were aware of
the need for, and benefits of, additional detail defining the Major Job
Classifications.[121]
124.
The lack of definitions within the Major Job
Classifications is problematic for contractors that wish to comply with the
law. The scope and limits of the Major
Job Classifications cannot be ascertained by knowledgeable tradesmen, even
after a diligent inquiry of government officials.[122]
125.
At the evidentiary hearing, for example, Director
Wade described the meaning of Major Job Classification 102 – “Laborer, skilled
(assisting skilled craft journeyman)” in this way: “Someone who has more skills than a laborer
and lesser skills than a skilled journeyman.”
What level of additional skills over that of common laborers is required
before this separate and higher classification is applicable, is not clear from
either Minn. R. 5200.1100 or this record.[123]
126.
In
October of 1999, a panel of the Minnesota Court of Appeals “encourage[d] formal
rulemaking by the Minnesota Department of Labor and Industry or other
appropriate agency,” so as to define terms within Minnesota’s prevailing wage
law. Urging the development of formal
rules, the panel wrote: “This court is 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.”[124]
127.
In June of 2004, a second panel of the Minnesota
Court of Appeals likewise urged DOLI to
undertake rulemaking to define job classifications, so that agency might
“observe the basics of procedural due process in making classification
decisions.” As the appellate panel
observed in AAA Striping Service Co. v.
Minnesota Dep’t of Transportation:
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. We conclude
that at a minimum, DOLI should engage in rulemaking as specified in its
own regulation, or, in the alternative, make available a reconsideration
process with a contested case proceeding when requested by an aggrieved party.[125]
128.
In February of 2007, the Office of the Legislative
Auditor issued a program evaluation of the prevailing wage system in
The source of the problem is
that the rules promulgated by the Department of Labor and Industry do not
define the job responsibilities of the various job classes for either
commercial or highway/heavy construction. In particular, there is no definition
of the responsibilities of common or skilled laborers in comparison to those of
skilled tradesmen….
RECOMMENDATION
The Department of Labor and
Industry should promulgate rules that define the job responsibilities of
workers in the various construction job classes listed in the department’s
rules.[126]
129.
Notwithstanding DOLI’s awareness of the
difficulties caused by the lack of definitions in the Major Job
Classifications, two decisions of the Court of Appeals urging the agency to
undertake rulemaking, a Legislative Auditor report similarly recommending that
rulemaking be undertaken to define the scope of the Major Job Classifications,
the effort to provide additional detail did not start in earnest until May of
2008. Director Wade noted that the
political sensitivity of the topic of the Major Job Classifications, the costs
to DOLI associated with developing definitions through rulemaking, the scale of
the work that would be required to define the missing terms and the lack of
direction from senior agency officials all contributed to the long periods of
delay in defining the scope of the Major Job Classifications.[127]
130.
In May of 2008, however, an unflattering exposé of
the prevailing wage system appeared on the Twin Cities NBC-affiliate
KARE-11. The television report was
critical of the lack of definition within prevailing wage classifications. Following the broadcast of the KARE-11
investigative report, Commissioner of Labor and Industry Steve Sviggum directed
officials in the Labor Standards Unit to develop the missing definitions.[128]
131.
Director Wade in turn assigned each labor
investigator within DOLI’s Labor Standards Unit a set of job titles in the
Major Classification List, with the instruction to begin drafting the missing
definitions. Ms. Wade estimates that
this drafting effort required at least 240 work hours.[129]
132.
Four weeks
after airing of the KARE-11 broadcast, DOLI likewise resuscitated a rulemaking
proceeding that it had started 9 ½ years earlier, but left dormant, relating to
revisions of the Major Job Classification system.[130]
133.
On May
29, 2008, DOLI requested a rulemaking hearing on a set of partial revisions to
the Major Job Classifications and the approval of the Additional Notice Plan
for these proposed rules. As the
Administrative Law Judge summarized this rulemaking proceeding:
The Department has proposed amendments clarifying when the Commissioner
must determine whether work performed by a class of labor not named in the
master job classifications is included in an existing class, adding a general
class of labor, and clarifying the minimum number of hours of work required for
a worker to be included in the wage survey process. The proposed amendments also create separate
classifications for certain highway-heavy and commercial construction duties;
create new classifications or amend existing classifications relating to
landscaping and seeding, and painting and striping of roads; and create new
classifications or amend classifications relating to warning lights, warning
signs, and other traffic control devices.
The proposed rule amendments also create new classifications or amend
existing classifications for survey workers, quality testers, articulated
haulers, and off-road trucks.[131]
134.
A broader and more detailed set of revisions to the
Master Job Classifications is still the subject of discussion and deliberations
among a DOLI Working Group on the Prevailing Wage Rules.[132]
135.
Government officials concede that definitions to
the Master Job Classifications would be helpful so as to advise bidders and
awardees which wage and fringe benefit rates apply to which tasks.[133]
136.
In the autumn of 2008, Dick Anfang, President of
the
137.
Notwithstanding the consensus that has been
achieved amongst the various trade unions, not all union leaders agree that the
accords described in the consensus document reflect the proper demarcations
between various skilled trades.[135]
138.
Moreover, even as to the Trades Council draft,
there still remain some areas of overlap between the various skill trades.[136]
CONTESTED
CASE PROCEEDINGS:
139.
The Notice and Order for Hearing in this matter was
issued by MnDOT-OCIC on December 4, 2006.[137]
140.
On
January 30, 2007, Comstock requested MnDOT-OCIC identify and disclose all of
the witnesses and potential exhibits that may be introduced at hearing.[138]
141.
On February 6, 2007, MnDOT-OCIC partially responded to the request, assuring Comstock
that it would update its disclosures consistent with any scheduling orders from
the OAH.[139]
142.
On August 16, 2007, MnDOT-OCIC served its Expert Witness List pursuant to the
then-current scheduling order, identifying sixteen potential expert witnesses. Comstock objected to this number of expert
witnesses as unreasonable and requested a prehearing conference to discuss the
issue.[140]
143.
On August 27, 2007, counsel participated in a
teleconference with the Administrative Law Judge.
As a result of the teleconference, the Administrative Law Judge issued a
Third Prehearing Order permitting MnDOT-OCIC
to introduce the testimony of its “expert” tradesmen, provided that affidavits
from the witnesses were submitted by Monday, September 24, 2007. The Administrative Law Judge also ordered
both parties to exchange statements from any non-tradesman expert witnesses,
including a summary of the facts and opinions of their expected testimony by
September 17, 2007. Comstock was ordered
to serve its expert tradesman affidavits by Monday, October 15, 2007 and the
period for discovery was extended another fourteen days until Monday, October
29, 2007.[141]
144.
On September 17, 2007, MnDOT-OCIC served Comstock with its Expert Witness Statement,
disclosing expected testimony from John R. Natwick and Doug Holmberg.
Holmberg’s report, however, was not complete and he noted that his opinions
were “preliminary.” Indeed, it appeared
that Mr. Holmberg was expecting additional information from MnDOT-OCIC before finalizing his
opinion.[142]
145.
By way of papers filed on September 21, 2007,
Comstock sought summary disposition on MnDOT-OCIC’s claims for additional
wages. Comstock argued that MnDOT-OCIC’s
claims were based upon: (1) rights to
recovery that are barred by the doctrine of laches; (2) arbitrary and
capricious government actions; (3) unauthorized rulemaking by MnDOT-OCIC or the
Minnesota Department of Labor and Industry and (4) unconstitutionally vague
rules.[143]
146.
On September 24, 2007, Comstock received
affidavits for seven of MnDOT-OCIC’s
expert tradesman. MnDOT-OCIC informed Comstock that “[t]he
State has requested, but not yet received” affidavits from the following
individuals: Harold Gordon, Jerome Johnson, Lee Steinbecker and Steve
Raatikkla.[144]
147.
On Tuesday, September 25, 2007, Comstock received affidavits from Messrs.
Raatikka and Johnson. Thereafter, on
Thursday, September 27, Comstock received an expert tradesman affidavit for
Harold Gordon from MnDOT-OCIC. MnDOT-OCIC
failed to submit an affidavit for Mr. Steinbecker. Accordingly, on September 26, 2007, Comstock
filed and served a letter in which it moved for an Order barring MnDOT-OCIC from introducing testimony
from Gordon, Johnson, Steinbecker and Raatikkla.[145]
148.
Pursuant to the stipulation of the parties, in
lieu of proceeding to the earlier-scheduled evidentiary hearing, oral argument
was heard upon Comstock’s Motion for Summary Disposition on January 10, 2008.[146]
149.
On February 7, 2008, the Administrative Law Judge
recommended that the Commissioner of Transportation grant-in-part and
deny-in-part Comstock’s Motion for Summary Disposition.[147]
150.
Thereafter,
the parties filed written exceptions to the Administrative Law Judge
recommendations and an oral argument was held before Deputy Commissioner Khani
Sahebjam of the Minnesota Department of Transportation.[148]
151.
On
October 10, 2008, Deputy Commissioner Sahebjam rejected the
February 7, 2008 recommendations and remanded this matter to OAH for additional
proceedings. The remand order included
the directive to develop the hearing record “on the following issues”:
(1) Does MN/DOT have legal authority to enforce the prevailing wage
requirements for the Detroit Lakes Regional Headquarters, Construction Project
Number OOTZ1791B;
(2) Based upon consideration of all the evidence
in the record and the testimony of experts and other witnesses, what tasks do
the disputed Master Job Classifications encompass and how should the workers
who performed the tasks of installing waterproofing, providing tools to Cement
Masons, helping painters, typing rebar, erecting chain link fences and
installing Venetian blinds be classified; and,
(3) Based on the classifications determined, how
much if any, in back wages does Comstock owe its employees?[149]
152.
Comstock sought review of the October 10, 2008 decision, by way
of a certiorari appeal to the Minnesota Court of Appeals. The Court of Appeals discharged the writ of
certiorari, and dismissed the appeal as untimely filed, on December 2, 2008.[150]
153.
A prehearing scheduling conference in this matter
was held on December 18, 2008, and DOLI was represented at this conference by
its attorney, William Bierman, Esq. As
detailed in the Fourth Pre-Hearing Order, Mr. Bierman later petitioned for his
agency’s intervention in this matter and received the service of filings from
other parties.[151]
154. DOLI’s motion for intervention was granted on February 25, 2009.[152]
155.
On March 10, 2009, the parties entered into a
Stipulation providing a schedule for the disclosure and exchange of materials
in advance of a rescheduled evidentiary hearing. In part, the Stipulation declared:
The Department of Transportation and Comstock have already exchanged statements identifying any person whom they intend to call as an expert witness as well as statements summarizing the facts and opinion of that testimony.
This Stipulation was adopted the
Administrative Law Judge on March 19, 2009.[153]
156.
Under the terms of the stipulated scheduling order,
the period for discovery closed on Friday, May 8, 2009.[154]
157.
During
a status conference on May 20, 2009, MnDOT-OCIC sought clarification of the
respective burdens of proof during the upcoming evidentiary hearing. The Administrative Law Judge expressed the
view that because MnDOT-OCIC
asserts that Comstock broke the law, and owes its employees back wages, MnDOT-OCIC
bore the burden of establishing the right to recover these sums.[155]
158.
On May
20, 2009, MnDOT-OCIC served Comstock with a near-complete set of its proposed
exhibits and a listing of its witnesses.
MnDOT-OCIC filed and served a copy of its proposed Exhibit 200-A out of
time on Tuesday, May 26, 2009.[156]
159.
At a
May 26, 2009 Pre-Hearing Conference, MnDOT-OCIC’s counsel represented that the
author of its Exhibit 8 – Doug Holmberg – was working for a copper mining
company in the Democratic Republic of the Congo. Further, counsel maintained that Mr. Holmberg
has not been within reach of a subpoena during the period following the Court
of Appeals’ dismissal of the writ of certiorari in December of 2008, through
the close of discovery in this matter on May 8, 2009. Specifically, Counsel for MnDOT-OCIC made the
following representations at the Pre-Hearing Conference.
“The expert in the
“He has been out of the country for over a
year and I had extreme difficulty in getting him and even more difficulty in
getting him to respond.”
“[Mr. Holmberg has been out of the country]
all of 2009 and part of 2008.”[157]
MnDOT-OCIC requested that Mr. Holmberg
testify at the hearing by telephone.
160.
In a Seventh Pre-Hearing Order, dated June 3, 2009,
the Administrative Law Judge granted-in-part Comstock’s Motion in Limine. The Order excluded the expert testimony of
Doug Holmberg on the grounds that Comstock had not been afforded a fair
opportunity to examine him prior to the evidentiary hearing.[158]
161.
On the first day of the evidentiary hearing,
counsel for MnDOT-OCIC sought to introduce elements of Mr. Holmberg’s expert
report, notwithstanding the fact that Mr. Holmberg was not called as a witness
or present at the evidentiary hearing.
The Administrative Law Judge sustained Comstock’s objection to the
receipt of such evidence. Unable to
establish a proper foundation for the introduction of Holmberg’s findings, in
the absence of its author, Counsel for MnDOT-OCIC asserted that he would seek
to present the excluded report directly to the Commissioner.[159]
162.
Exhibit 200 and a set of later supplements to this
exhibit were developed by Ms. Wilder and MnDOT-OCIC in advance of the
evidentiary hearing in this matter.[160]
163.
Over the
objection of Comstock, the Administrative Law Judge permitted MnDOT-OCIC to
offer a supplement to Exhibit 200 as an exhibit at the evidentiary hearing
notwithstanding the fact that this item was first presented six days after the
due date for filing hearing exhibits.
The supplement was marked for identification as Exhibit 200-A.[161]
164.
Exhibit 200-A contains numerous errors and, in the
judgment of its principal author, Ms. Wilder, is unreliable.[162]
165.
Similarly, a still later set of revisions to Exhibit
200-A, offered by MnDOT-OCIC out of time, on the fourth day of the evidentiary
hearing, were not complete substitutes for 200-A. These supplemental items, marked for
identification as Exhibits 200-B and 200-C, are only partial substitutions for
Exhibit 200-A. MnDOT-OCIC proposed that
these supplemental exhibits overlay part of Exhibit 200-A, notwithstanding the
fact that the calculations reflected in the various pieces of the proposed
combination do not match or reconcile with each other.[163]
166.
If accepted into the hearing record, Exhibits 200-B
and 200-C would conflict with the data recorded on the daily summaries of
Exhibit 200-A; rendering the combined mixture confusing and undecipherable.[164]
167.
On the
second day of the evidentiary hearing, Comstock offered into the hearing record
transcripts of the sworn deposition testimony of Erik Oelcker.[165]
168.
Earlier, in January of 2009, Mr. Oelcker suffered a
traumatic brain injury. He has been
directed by his physicians not to focus his mind on any matter for any length
of time so as to provide an opportunity for his brain to heal. In the judgment of his physicians, Mr.
Oelcker is medically unavailable for trial.[166]
169.
Counsel for MnDOT-OCIC had a full and fair
opportunity to develop the evidentiary record at Mr. Oelcker’s depositions on
July 10, 2007 and October 4, 2007, and a motive that was identical to that on
the first day of the evidentiary hearing, but counsel chose not to do so. The
Administrative Law Judge, citing Minn. R. Evid. 801(b)(1), accepted into the record
a certified copy of Mr. Oelcker’s July 10, 2007 and October 4, 2007 depositions.[167]
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 substantive and procedural requirements of law
and rule.
3.
The Minnesota Prevailing Wage Law 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.[168]
4.
The Minnesota Prevailing Wage law 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.
5.
Under the Minnesota Prevailing Wage Act, DOLI
establishes the labor classifications for workers and determines the prevailing
wage rate for the classifications.[169]
6.
Without a regulatory definition of “common
laborer,” the requirement that workers performing the duties of a common
laborer must be paid the wages then-prevailing in the community for that labor
class, is so vague that persons of common intelligence must necessarily guess
at the meaning of the Act’s obligation.
7.
Without a regulatory definition of “skilled
laborer,” the requirement that workers performing the duties of a skilled
laborer must be paid the wages then-prevailing in the community for that labor
class, is so vague that persons of common intelligence must necessarily guess
at the meaning of the Act’s obligation.
8.
Without a regulatory definition of “carpenter,”
the requirement that workers performing the duties of a carpenter” must be paid
the wages then-prevailing in the community for that labor class, is so vague
that persons of common intelligence must necessarily guess at the meaning of
the Act’s obligation.
9.
Without a regulatory definition of “sheet metal
worker,” the requirement that workers performing the duties of a sheet metal
must be paid the wages then-prevailing in the community for that labor class,
is so vague that persons of common intelligence must necessarily guess at the
meaning of the Act’s obligation.
10. Without
a regulatory definition of “cement mason,” the requirement that workers
performing the duties of a mason must be paid the wages then-prevailing in the
community for that labor class, is so vague that persons of common intelligence
must necessarily guess at the meaning of the Act’s obligation.
11. Without
a regulatory definition of “ironworker,” the requirement that workers
performing the duties of an ironworker must be paid the wages then-prevailing
in the community for that labor class, is so vague that persons of common
intelligence must necessarily guess at the meaning of the Act’s obligation.
12. The consequences –
in terms of corporate reputation, profitability and opportunity for future work
– can be severe if a state contractor does not abide by the Prevailing Wage
Act. These consequences may include
misdemeanor criminal sanctions (including imprisonment) and a $300 fine. Moreover, “[e]ach day that the violation
continues is a separate offense.”
Lastly, the Department may preemptively reject the bids and proposals of
any contractor that has a history of noncompliance with the prevailing wage
laws.[170]
13. The agencies’
claim that contractors can, and do, obtain meaningful guidance on the proper
classification of employees from the Labor Standards Unit of DOLI is not
supported by this record.[171]
14. DOLI’s claim that
it is developing regulatory definitions of each skilled craft and each class of
labor on a “case-by-case basis” is not supported by the evidentiary record.[172]
15. The
Major Job Classifications in Minn. R. 5200.1100 are so imprecisely defined that
they encourage arbitrary and discriminatory enforcement.
16. While MnDOT has
neither a policy nor a rate-setting role under the prevailing wage laws, it
does have a role in enforcing these requirements. The Commissioner of Transportation is
authorized by state law to “require adherence” to the provisions of the state
prevailing wage laws from its contractors.[173]
17. The hearing record
does not detail why MnDOT-OCIC moved from its position, stated in September of
2001, that Comstock was in compliance with the labor provisions of the
contract, to the view expressed five months later, in February of 2002, that
Comstock “inappropriately classified and inappropriately paid” its employees.
18. The
record does not detail, much less establish, how any of Comstock’s
classifications of employee work was in error.
19. Comstock’s
assignment of workers among various job classifications was reasonable and in
accordance with the terms of the MnDOT – Comstock contract.
20. The Administrative
Law Judge adopts as Conclusions any Findings that are more appropriately
described as Conclusions.
21. The Memorandum
that follows explains the reasons for these Conclusions, and the Administrative
Law Judge therefore incorporates that Memorandum into these Conclusions.
Based upon these
Conclusions, the written submissions of the parties, the affidavits and other
documents filed in this matter, and the argument of counsel, the Administrative
Law Judge makes the following:
RECOMMENDATION
(1)
The Commissioner should DISMISS the Notice and
Order for Hearing in this matter.
(2)
The Commissioner should direct MnDOT-OCIC to remit to Comstock the
$27,074.86 in contract proceeds that has been held pending a final “close out” of
Project Number OOTZ1791B.
Date:
September 28, 2009.
|
_Eric L.
Lipman _ |
|
|
ERIC L. LIPMAN |
|
|
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. In order to comply with this statute, the Commissioner must
then return the record to the Administrative Law Judge within 10 working days
to allow the Judge to determine the discipline to be imposed. 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.
Authority of
MnDOT-OCIC to Seek Enforcement of the Prevailing Wage Provisions Against
Comstock
Comstock moved for dismissal of MnDOT-OCIC’s
claims for back wages on the grounds that MN-DOT lacks the authority to enforce
the requirements of
Comstock argues
that MnDOT-OCIC is without the authority to press its prevailing wage claims
because the Minnesota Legislature has conferred these enforcement
responsibilities upon DOLI. Comstock
contends that under Minn. Stat. §
177.44, the only enforcement role MnDOT-OCIC has as to prevailing wages
is as to contracts “for the construction or maintenance of a highway.” Because the instant contract was for the
construction and renovation of buildings, and not a “highway,” Comstock maintains that
MnDOT-OCIC is without the authority
to ensure compliance with the prevailing wage statutes.
MnDOT-OCIC responds that it does have the
authority to ensure compliance with the prevailing wage statutes; and that it
is drawn from two different sources.
MnDOT-OCIC asserts that it may ensure compliance with the prevailing
wage laws because the Commissioner has the authority to erect buildings that
are “incidental” to maintenance of the state highway system – and these
“incidental” activities are likewise subject to the prevailing wage laws. As MnDOT-OCIC argues, because the agency
personnel who will work in the Detroit Lakes Regional Headquarters will later
“maintain the highways,” the renovation contract was itself for the “construction or maintenance of a highway” under Minn. Stat. § 177.44. Additionally,
MnDOT-OCIC argues that under the terms of Section 810 of the underlying
contract, it has full authority to enforce compliance with the prevailing wage
laws against Comstock. These arguments
are addressed in turn below.
Minn. Stat. § 177.44, subd. 1 provides:
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 based on bids as provided in Minnesota Statutes 1971, section 161.32, to which the state is a party, for the construction or maintenance of a highway, may not be permitted or required to work longer than the prevailing hours of labor unless the laborer or mechanic is paid for all hours in excess of the prevailing hours at a rate of at least 1-1/2 times the hourly basic rate of pay of the laborer or mechanic. The laborer or mechanic must be paid at least the prevailing wage rate in the same or most similar trade or occupation in the area.[174]
MnDOT-OCIC and Comstock agree that the first two requirements of the statute are satisfied in this case – namely, that the underlying contract was one that was “based on bids,” and as to which “the state is a party.” The dispute centers on whether the renovations and upgrades to MnDOT’s Detroit Lakes Regional Headquarters are fairly considered to be “for the construction and maintenance of a highway.”
In the view of the Administrative Law Judge, Minn. Stat. § 177.44 cannot be read so broadly as to include the construction and renovations of facilities which merely benefit the highway system, but are themselves not part of the maintenance or construction of any particular roadway. Read against the backdrop of applicable canons of statutory construction,[175] Minn. Stat. § 177.44 does not reach the OCIC-Comstock contract.
Yet, this conclusion does not end the inquiry. While Comstock argues that if Minn. Stat. § 177.44 does not authorize an enforcement role for MnDOT-OCIC, no such role is possible; this is not our law. The state courts have announced that so long as the Legislature has not prohibited a state agency from pursuing a particular objective, the agency has wide latitude to negotiate for contract rights and benefits that it deems beneficial to the public interest.
The case of Watson Construction Company v. City of Saint
Paul is particularly instructive in this regard. In that case, the contractor sought recovery
of the building permit fees that it paid to the City of
The requirement that the contractor secure and pay for the building permit was a condition which the state could properly include in the contract as one under which the work should be done. It does not necessarily follow that, since this condition imposed upon the contractor the requirement to comply with the ordinances of the city, the state by imposing the condition surrendered its sovereign rights and created a burden upon the public. On the contrary, we can only assume that an additional benefit would accrue to the state from subjecting the contractor to the additional inspection and supervision of the city architect. Since there is no conflict here between the state and the municipality and the permit requirement of the contract has placed no burden upon the state, it cannot be said that the issue of state sovereignty is in any way involved.[176]
A similar rationale applies in
this case. Because there is no statutory
prohibition on MnDOT-OCIC undertaking an enforcement role on prevailing wages
under its building contracts, such a role is one as to which it could
permissibly bargain for in its contract.[177]
MnDOT
did contract for such role in its building contract with Comstock. Section 810 of the underlying contract, paragraphs
1.23 and 1.24, state in pertinent part:
The Commissioner
of Transportation shall require adherence to the state prevailing wage law, as
such, the Department will withhold funds sufficient to protect the Department’s
interests in the implementation of these Special Provisions against the
Contractor as provided for under section 1906, Standard Specifications for
Construction. Minn. Stat. § 177.44, subd. 7.
….
1.24 LABOR AND INDUSTRY WAGE RATES
A. PREAMBLE
1. It is in the
public interest that public works projects be constructed and maintained by the
best means and, highest quality of labor reasonably available and that persons
working on public works be compensated according to the real value of the
services they perform. Therefore, the Department of Transportation will
administer this Contract according to the provisions set forth in
B. MINIMUM WAGE RATES
1. The minimum hourly rates of wages required to be paid to the various laborers and mechanics employed by the Contractor and the subcontractors in the construction work on the contract shall be an amount equal to the sum of the basic hourly rate plus applicable fringe benefits as certified by the Minnesota Department of Labor and Industry for State Funded Construction Projections.
….
5. The Department-of Transportation shall apply classifications of labor, as listed under 6 MCAR 5200.1100 - Master Job Classifications. Under Standard Specifications for Construction 1906, the Department shall withhold such amounts as may be needed to protect the Department’s interests in consideration of charges or assessments against the Contractor, whether arising from this contract or any other contract with the Department.[178]
The payment of prevailing wages to laborers
and mechanics of the Contractor, and the ability to enforce these requirements
against Comstock, were bargained-for exchanges under the contract.
II.
Exclusive
Jurisdiction of the District Court on any Contract Dispute
Alternatively, Comstock asserts that even if
MnDOT-OCIC has enforceable claims against it, MnDOT-OCIC has selected the wrong
forum for resolution of this dispute.
Comstock relies upon Supplementary Condition Number 4 of the contract
when asserting that all such disputes must be venued in the District Court of
Minnesota for
The Contractor and
the State may exercise those remedies in District Court as may be available to
them in connection with any dispute arising out of this agreement which cannot
be settled by the parties.[179]
The Administrative Law Judge finds the case
of Florida State Board of Administration v. Law
Engineering and Environmental Services, Inc., instructive. In that case, a Florida-based pension fund,
sued its Georgia-based engineer, over a dispute involving a property in
Generally, courts
have found that use of the words “may” and “should” signify permissive clauses,
while use of the words “shall,” “will” or “must” signify mandatory clauses.
The forum
selection clause in Paragraph E contains no mandatory language and evinces no
intent to make jurisdiction exclusive. It merely provides that any legal action
with regard to the agreement “may be brought in the Courts of the State of
Similarly, in this case, the authorization
that the State “may exercise”
available legal remedies in Minnesota District Court, is a permissive but not a
mandatory provision of the contract.[181]
The
question then necessarily arises: Is the selection of the Office of
Administrative Hearings a proper forum for resolution of the dispute between
the parties? The Administrative Law
Judge concludes that OAH is a proper forum.
The underlying contract confers upon MnDOT the contractual right to
administer the contract in accordance with Minnesota’s prevailing wage laws and
to withhold such funds due Comstock “as may be needed to protect the
Department’s interests ….”[182] Because MnDOT wishes to inform its exercise
of contract administration powers (in what is a highly-contentious,
factually-intensive dispute), use of the contested case procedures is wholly
consistent with Minn. Stat. §§
14.02 and 14.57. Further, while this dispute could have been
presented to other tribunals, between MnDOT and Comstock, the agency won the
proverbial “race to the courthouse.”[183]
Having sought resort to remedies outside of the contract, first, MnDOT
was permitted to select its forum.[184]
III.
Proof of
Classification Error
Minnesota Rule
1400.7300, subpart 5, sets out the burden of proof in contested cases before
the Office of Administrative Hearings.
It reads:
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.
Because
MnDOT-OCIC asserts that as a result of violations of Minnesota’s prevailing
wage laws Comstock owes its employees $98,772.38 in additional wages, and seeks to
enforce this claim through either a setoff of withheld contract amounts, or
referral of Comstock for suspension or debarment, or all three,[185]
it is the party that is “proposing that certain action be taken” under
Minnesota Rule 1400.7300. Accordingly,
MnDOT-OCIC has the burden of proving the facts at issue by a preponderance of the evidence.
This construction of the rule is
likewise consistent with the practice in earlier cases where the Department of
Labor and Industry has sought to enforce the wage and hour laws,[186]
and where employees have sought to recover on their own for claims under the
Fair Labor Standards Act.[187]
The case of In
the Matter of the Truck Rental Rate Effective December 20, 2004, cited by MnDOT-OCIC, does not point to a
different conclusion. In that case, a set of private trucking firms
challenged the adequacy and completeness of the Commissioner’s rate-setting
methods. Because the trucking companies
asserted that the agency had acted
illegally, and requested relief, those firms bore the burden to prove the
facts at issue in that dispute by a preponderance of the evidence.[188] This
is not our case. In this case,
MnDOT-OCIC asserts that its contractor has acted illegally and has requested a
determination that it is lawfully entitled to relief. In such a posture, it bears the burden of
proving its entitlement to recover on its claims.
IV.
Proof of Back
Wages Owed
A.
MnDOT-OCIC Failed
to Shoulder its Burden of Proof as to Classification Errors by Comstock
The record does
not include any proof of classification error by Comstock.
A key infirmity
follows from MnDOT-OCIC’s reading of the Prevailing Wage Act. As MnDOT-OCIC reads the Act, workers are to
be apportioned among different major job classifications based upon the nature
of the construction materials that are used on a particular work day. For example, in its Post-Hearing brief,
MnDOT-OCIC asserts that all activity under the contract that involved
structural steel must be classified as “iron work.”[189] Under this view, no common laborer hours
would accrue for unpacking, loading, maintaining or cleaning up any item which
happens to be made of steel. Such a view
is at odds with the sworn testimony of its own expert witnesses and the
arguments it advanced at the evidentiary hearing. It is not a proper reading of either the
contract or the Prevailing Wage Act.
For purposes of
the Prevailing Wage Act, workers should be classified based upon the skills
they render, rather than the materials they touch.[190]
Likewise important
to this dispute is the breath and meaning of Major Job Classification 102,
“Skilled Laborer.” In its Post-Hearing
submissions, MnDOT-OCIC argues that the Skilled Laborer classification extends to
any work that “assists” a skilled craftsman.[191] The boundary on what it means to “assist” a
skilled craftsman is not offered by MnDOT-OCIC; and presumably is so expansive
that it includes tasks that, at other times, the MnDOT-OCIC and its experts
assert were properly undertaken by “Common Laborers.”[192]
MnDOT-OCIC urged
that the descriptions of the duties in Exhibit 151 represent the general and
common understanding of the various duties in the construction trades.[193] The description of the duties of Common
Laborers that is found in Exhibit 151 states that such workers have significant
roles in unloading materials, removing materials, installing metal fencing,
welding in place pre-cast panels and performing pipe rehabilitation work. Presumably these are all tasks that “assist”
skilled journeymen and that the craftsmen find helpful.[194]
Because one cannot
distinguish between skilled laborers and common laborers on the basis of their
helpfulness to a skilled craftsman, MnDOT-OCIC’s reading of Major Job Classification
102 is disfavored.
Most problematic,
even if there was enough detail in the major job classifications for MnDOT-OCIC
to sort workers between different job classifications, the agency simply does
not have a basis for undertaking this apportionment. As detailed in the Findings above, because so
much time has passed since contract performance was underway, officials of
MnDOT-OCIC cannot say with any certainty what work was performed by whom on
which days. The agency surmises; it
infers; but none of its guesses as to who did what work are firmly grounded in
the record.
No witnesses
called by MnDOT-OCIC spoke authoritatively as to any errors in the
classifications made by Comstock and MnDOT-OCIC offered no reasonable basis to
contest the apportionment made by Comstock.
Lastly, the basis for the about-face made by the agency – from its position in September of 2001, that Comstock was in compliance with the labor provisions of the contract, to the view expressed in February of 2002, that Comstock “inappropriately classified and inappropriately paid” its employees – was never adequately explained. The labor investigator’s claim that the deficiencies were orally detailed to Comstock’s Contract Administrator is not credible and is not supported by the underlying record.
The best explanation of MnDOT-OCIC’s sudden turnabout was that Ms. Wilder sought to retaliate against Comstock; punishing it for Mr. Koppang’s intemperately worded electronic mail message regarding the withholding of payments due to subcontractor employees. The abrupt switch in MnDOT-OCIC’s assessment of Comstock – made at a time that Comstock was nearing completion of the project work, but shortly after Koppang had criticized Wilder’s performance – lends support to this view. Moreover, Ms. Wilder’s later transmission of a demand for payment that she knew contained errors, fortifies the conclusion that retaliation was her aim.[195]
Comstock is
entitled to dismissal of the claims for back wages and a release of the
contract earnings held by MnDOT-OCIC.
B.
Ordinarily,
Ambiguities in Government Contracts are Construed Against the Drafting
Agency
MnDOT-OCIC’s claim
for back wages is likewise hobbled because it did not establish that there is a
single, commonly held understanding of terms such as “common laborer,” “skilled
laborer,” “carpenter,” “sheet metal worker” or “ironworker”; or that Comstock’s
construction of any of these contractual terms was unreasonable.[196]
In those instances
in which a government agency had the sole control over the drafting of a
contract,[197]
as is the ordinary practice with state procurements, and the contract terms are
susceptible to more than one meaning, the ambiguous terms are construed against
the agency.[198]
In
this case, because MnDOT-OCIC could have included additional detail as to the
meaning and boundaries of the different Major Job Classifications, but did not
do so, it is improper for it to insist upon application of the missing
terms. MnDOT-OCIC may not unilaterally
revise the contract terms because it prefers other – but unstated – meanings to
apply. The agency must accept the
contract as the agency drafted it.
C.
Evidence of the
Accord Negotiated Among
Much of MnDOT-OCIC’s
case-in-chief was centered on the drafting that occurred in the autumn of 2008,
by the
The hearing record reflects a very different
reality. President Anfang notes in his
November 24, 2008 transmittal letter how difficult it was to achieve the
agreements that are reflected in the “consensus” draft.[201] Moreover, as recently as the evidentiary
hearing, MnDOT-OCIC’s own expert witnesses did not agree that the consensus
document reflects a proper understanding of the various skilled trades.[202]
Thus, as useful as the Trade Council
draft is to the effort to one day define the Major Job Classifications, this
draft does not memorialize the views of either the agency or Comstock at the
time of contract formation; it does not memorialize the views of the broader
contracting industry during the year 2000, 2001 or 2002; and it does not
reflect a widespread understanding of the meanings of the Major Job
Classifications today.[203] At most, it is a recent set of compromises
among some stakeholders.
Moreover, a comparison between the
classification descriptions developed by DOLI,[204]
or the later Trade Council draft,[205]
and the Major Job Classifications in Minn. R. 5200.1100, makes clear how much
of the needed detail is missing from the regulations. This broad and deep range of detail has never
been assumed.
V.
Comstock’s Other
Claims of Error
At the close of MnDOT-OCIC’s
case-in-chief, Comstock renewed the legal arguments it made in its first Motion
for Summary Disposition. Resting upon
the detailed record of the evidentiary hearing, Comstock asserted that
MnDOT-OCIC’s: (1) claim for back wages follows from an arbitrary application of
the classification standards; (2) use and application of informal job
classification determinations amounts to unpromulgated rulemaking; and (3)
enforcement of the Prevailing Wage Act determinations was unconstitutional as
applied to it.
A.
The Evidentiary
Record Makes Clear that the Labor Standards Provisions of the Contract were
Arbitrarily Applied
Under the Minnesota Administrative Procedures Act,
a key inquiry is whether the agency’s decision represents a reasonable judgment
under the circumstances and not merely the exercise of will.[206] An agency fails to undertake reasoned
decision-making when it:
relied on factors
which the legislature had not intended it to consider, if it entirely failed to
consider an important aspect of the problem, if it offered an explanation for
the decision that runs counter to the evidence or if the decision is so
implausible that it could not be ascribed to a difference in view or the
product of agency expertise.[207]
As detailed in the Findings above,
none of MnDOT-OCIC’s six different demands for payment of back wages followed
from reasoned decision-making. When
rendering its demands for back wages MnDOT-OCIC: relied upon factors that the
Legislature had not intended it to consider;[208]
entirely failed to consider important aspects of the problem when classifying
contract work;[209]
offered explanations for its regulatory demands that ran counter to the
evidence;[210]
and proffered explanations for its classification decisions that were so
implausible that they could not be ascribed to a difference in view or the
product of agency expertise.[211]
Comstock is
entitled to dismissal of the claims for back wages and a release of the
contract earnings held by MnDOT-OCIC.
B.
The Evidentiary
Record Makes Clear that the Informal Classification Determinations of DOLI were
Applied as if they were Formal Rules
Comstock also
argues that MnDOT-OCIC’s claims should be dismissed on the grounds that the
wage classification determinations rendered by Mr. Oelcker and Ms. Wilder are
not lawful or enforceable. Comstock
asserts that the classification determinations applied in this case are
unpromulgated rules and may not be given effect. In Comstock’s view, because MnDOT-OCIC is
applying informal classification determinations from DOLI, across contractors,
and giving these determinations future effect, the classification decisions
should have been developed through rulemaking.
MnDOT-OCIC and
DOLI respond that when their labor investigators announce that a given task
fits into a particular job classification, they are not rulemaking, but rather
undertaking a “case-by-case” adjudication of the meanings of the Major Job
Classifications.[212] Executive Branch agencies are granted
considerable discretion to decide whether to develop regulatory policy
“deductively,” by promulgating a new rule, or “inductively,” through a series
of individual adjudications.[213] Further, the appellate courts have instructed
that every executive branch agency – and in the area of labor classifications,
DOLI in particular – has the “flexibility and discretion to depart from formal
rulemaking” when applying a given legal standard to a particular set of facts.[214]
While the
agencies’ argument is cleverly phrased, in this instance, neither MnDOT-OCIC
nor DOLI was using “case-by-case adjudications” to develop the missing
definitions for the terms “skilled laborer,” “sheet metal worker,” “carpenter,”
“cement mason” or “ironworker.” A few
points deserve special emphasis.
First, when
Comstock sought regulatory guidance from the agencies on the meaning of the
Major Job Classifications, initially from MnDOT-OCIC, and then later from DOLI,
Ms. Wilder and Mr. Oelcker both disclaimed that their agencies sought to render
formal regulatory definitions beginning with this contract.[215]
Second, the
The regulatory
meanings of the terms “common laborer,” “skilled laborer,” “sheet metal
worker,” “carpenter,” “cement mason” and “ironworker,” as used in the Major Job
Classifications, are questions that undoubtedly interest thousands of
Third, implicit in the recognition of
case-by-case adjudications as an alternative to notice and comment rulemaking,
is that any incremental development of policy will involve similar
formality. It simply cannot be that the
occasional electronic mail message from Mr. Oelcker, or notes from a telephone
consultation with Ms. Drier, has the same regulatory significance as rules
promulgated by the agency following notice and comment rulemaking. As the record in this case makes clear, such
writings do not contain the “principles of law or policy
lawfully declared by the agency as the basis for its decisions in particular
cases” and they are not maintained by either MnDOT-OCIC or DOLI so as to permit
interested persons to petition for conversion of these informal writings into
formal rules.[220] A
conclusion that senior labor investigators could add to the classification
rules in this way does considerable violence to the scheme established by the
Minnesota Legislature in Chapter 14. As
the Minnesota Supreme Court has written:
The purpose of the
Administrative Procedure Act is to ensure that we have a government of law and
not of men. Under that act, administrative officials are not permitted to act
on mere whim, nor their own impulse, however well intentioned they might be,
but must follow due process in their official acts and in the promulgation of
rules defining their operations.[221]
The agencies’ construction of the terms
“common laborer,” “skilled laborer,” “carpenter,” “sheet metal worker,” “cement
mason” and “ironworker” is only grounded on these “impulse[s] … however well
intentioned they may be ….” Comstock is
entitled to dismissal of MnDOT-OCIC’s claim for back wages.
C.
The Commissioner
Could Defer the Question of the Constitutionality of the Labor Standards
Regulations as Applied to Comstock
Comstock asserts
that the text of Minn. R. 5200.1040 and 5200.1100 fail to provide sufficient
guidance as to how construction work should be classified. Comstock argues that without sufficient
definiteness, the rules fall below the required constitutional standards. The challenge is two-fold: First, Comstock contends that because
violations of the prevailing wage laws can result in criminal penalties, the
state labor classifications may not be so imprecise that “persons of common
intelligence must guess at its meaning or differ as to its application.”[222] Secondly, Comstock argues that the rules are
so incomplete that the classification determination process results in
decisions that are inconsistent, wholly subjective and arbitrary.[223]
Under both the
state and federal constitutions, administrative rules must meet certain due
process standards of definiteness.[224] A rule is void for vagueness if it fails to
give a person of ordinary intelligence a reasonable opportunity to know what is
prohibited or fails to provide sufficient standards for enforcement by
executive branch officials.[225] Thus, if a regulation defines an act in a
manner that encourages arbitrary enforcement, or is so indefinite that people
must guess at its meaning, it is impermissibly vague.[226]
Likewise
important, in a contested case proceeding, neither an Administrative Law Judge
nor the head of an Executive Branch agency may declare a statute or rule
“facially unconstitutional.” The power
to declare a law unconstitutional in all settings is vested with the judicial
branch of state government.[227]
At its widest arc,
the authority of an agency head includes the power to consider whether
application of a statute or rule in a particular factual setting, meets the
constitutional standards that have been announced by our courts.[228]
While the
underlying record would support a determination in Comstock’s favor on its
constitutional claims, the Commissioner may wish, for sound prudential reasons,
not to ground his decision upon any particular reading of the state or federal
constitutions. Given Comstock’s
entitlement to complete relief on its other claims, resolution of this case
does not require the Commissioner to reach Comstock’s constitutional
claims. In like circumstances, the state
courts avoid deciding a case on constitutional grounds when other,
non-constitutional bases for the judgment exist.[229]
VI.
The Contested Case
Process
Pursuant to Minnesota Rule 1400.5500,
subparts B, J and Q, the Administrative Law Judge entered a series of detailed
scheduling orders. These orders were
entered so as to facilitate the early exchange of discoverable information
amongst the parties, grant the parties genuine opportunities to depose adverse
witnesses and focus the parties’ preparations for the evidentiary hearing.
The
most recent of the scheduling orders followed from a joint stipulation among counsel,
in which the attorneys jointly agreed upon the discovery and filing deadlines
that would precede the evidentiary hearing.[230]
During the evidentiary hearing, the
Administrative Law Judge enforced the deadlines established in these orders in
a way that excluded from the hearing record evidence that was arguably
relevant, but which was not disclosed in a timely fashion.[231]
Because
counsel for MnDOT-OCIC pledged to present the materials that were excluded from
the hearing record directly to the Commissioner, and again urge its receipt
into the record, some further description of these events may be helpful.[232]
A. Receiving
Telephonic Testimony from Mr. Holmberg
As noted above, in
the Seventh Pre-Hearing Order, the
Administrative Law Judge excluded
the expert testimony of Doug Holmberg, via telephone, on the grounds that
Comstock had not been afforded a fair opportunity to examine him prior to the
evidentiary hearing.
While mindful that
it is not uncommon for the Office of Administrative Hearings to receive
testimony from witnesses telephonically, it is also true that in all but rare
instances, this procedure is undertaken upon the stipulated agreement of the
parties.
In
the rare case where telephone testimony is received over the objection of a party,
a close balancing of the benefits and the harms to the fact-finding process
from receiving such testimony is undertaken by the Administrative Law
Judge.
Important to the
balancing of interests in this case, was the fact that Mr. Holmberg was not an
indispensible fact witness, but rather a labor cost estimator; presumably not
unlike other similarly-trained professionals in his field. Moreover, it was represented to the
Administrative Law Judge that Mr. Holmberg has been outside of the
Without a
stipulated agreement among the parties permitting telephonic testimony of this
expert, and no procedural rule guaranteeing MnDOT-OCIC such a convenience as a
matter of right, the agency should not have presumed that it could dial its
expert in central Africa at the start of the evidentiary hearing. Under these circumstances, receiving Mr.
Holmberg’s testimony over the objection of Comstock would have been prejudicial
and unfair.
B. Exclusion of the Second Round of
Revisions to Exhibit 200
As noted above, on May 20, 2009, MnDOT-OCIC served Comstock
with a near-complete set of its proposed exhibits; a set that included Exhibit
200. MnDOT-OCIC later filed and served a
copy of its proposed supplement to Exhibit 200 – marked as Exhibit 200-A – out
of time on Tuesday, May 26, 2009.
In the Seventh
Pre-Hearing Order, the Administrative Law Judge permitted MnDOT-OCIC to
submit the supplemental exhibit, out of time, notwithstanding the deadline for
filing hearing exhibits. As the
Administrative Law Judge reasoned:
[B]ecause the supplementary Exhibit 200-A
summarizes data that is found elsewhere in the evidentiary record, and Comstock
will have eight working days (and twelve calendar days) in advance of the
evidentiary hearing to review this summary with its trial team, the balancing
of interests lies in favor of receiving this item upon the presentment of a
proper foundation.[233]
Notwithstanding
this largesse, on the fourth day of the evidentiary hearing, MnDOT-OCIC offered
two further supplements to Exhibit 200 – marked for identification as Exhibits
200-B and 200-C. MnDOT-OCIC proposed
that these supplemental exhibits overlay part of Exhibit 200-A, although the
calculations in the proposed combination of documents did not match or
reconcile with each other. Receiving
these supplements, which detail new factual claims and new rationales for the
agency’s position, and were disclosed for the first time in the middle of the
evidentiary hearing, would have been unduly prejudicial.
C. Receipt of the Deposition Transcript of
Erik Oelcker
On the second day of the evidentiary
hearing, Comstock, in lieu of calling Mr. Oelcker as a witness during the
proceedings, offered certified copies of Mr. Oelcker’s July 10, 2007 and
October 4, 2007 depositions for inclusion in the hearing record.[234]
Mr. Oelcker has suffered a traumatic
brain injury and, in the judgment of his physicians, is medically unavailable
for trial.
MnDOT-OCIC
objected to the receipt of the depositions into the hearing record. Counsel for MnDOT-OCIC asserted that because
he did not foresee either Mr. Oelcker’s injuries or later unavailability, he
did not ask questions of Mr. Oelcker during either deposition. As Counsel argued, the depositions of July
10, 2007 and October 4, 2007 were “discovery depositions,” and not intended to
preserve the witness’ testimony for the later evidentiary hearing.
The Administrative
Law Judge disagrees. As the United
States District Court for the District of Minnesota wrote in a similar context:
Depositions are a
discovery device governed by Rules 26 through 32 of the Federal Rules of Civil
Procedure. Depositions also serve to preserve relevant testimony when the
deponent might be unavailable to testify at trial. Neither the Rules of
Civil Procedure nor the Rules of Evidence make any distinction between
discovery depositions and depositions for use at trial. The court concludes
there is no difference. A party who
makes the tactical decision during a deposition to refrain from examining a
witness who is beyond the subpoena power of the court, takes the risk that the
testimony could be admitted at trial if the witness will not or cannot appear
voluntarily.[235]
MnDOT-OCIC had a full opportunity to develop
the record at Mr. Oelcker’s depositions on July 10, 2007 and October 4, 2007
and a motive to do so that was identical to that on the first day of the
evidentiary hearing.[236] Yet, for whatever tactical reason, it did not
do so. Given Mr. Oelcker’s
unavailability as a witness, the certified copies of the earlier deposition
transcripts were properly received into the hearing record.[237]
VII.
CONCLUSION
When it is all packed together in one place, the hearing record in this case consumes more than six bankers boxes.
Yet, for all of the reams of documents in the record, the equities can be described with a handful of words: Would any person wish to be treated by his government as Comstock was treated in this case? Would anyone be content to have her own earnings set through the methods used by the government in this case?
And so, from a case that has presented a long string of difficult questions, the last one in the series has an easy answer: No one with an ounce of sense would be content to switch places with Comstock.
Government officials
acknowledge that it is reasonable for a contractor to expect that any claimed
violations of the law will be set forth specifically in a demand for
compliance.[238] In this case, however, the specifics of the
claimed shortcomings and the bases for the claims were never explained.
Indeed, after disclaiming the accuracy of the demand for back wages it
made in the Notice and Order for Hearing,
MnDOT-OCIC only made its claim known on the fourth day of the evidentiary
hearing; and then only in response to a direct question from the
Administrative Law Judge on this point.[239] Thus, notwithstanding years of
correspondence, pre-hearing discovery and litigation, MnDOT-OCIC did not commit
to a particular stance in this case until well after the evidentiary hearing
was underway.
The record likewise
includes the testimony of government officials to the effect that it is
reasonable for a contractor to expect timely and responsive replies to
inquiries on compliance issues. Yet,
despite these general admonitions, meaningful guidance as to the meaning and
scope of the major job classifications was not rendered by MnDOT-OCIC’s labor
compliance unit or DOLI’s labor standards unit.
A description of what the various labor classifications mean was not
available at the time of contract formation; it did not exist during performance
under the contract; and it does not exist today.
The administrators of the
labor classification program at DOLI concede, as they must, that the
distinctions between various job classifications are not well-defined and that
the very same work can reasonably be attributed to different major job
classifications. Neither the contractors
that employ tradesmen, or the trade unions themselves, can say with any
precision where the boundaries of particular job classifications begin or
end. Beyond the most general
descriptions of the different trades, no one knows what the various
classifications mean.
Despite these gaps,
MnDOT-OCIC’s labor compliance unit administered the contract as if the unknown
was in fact known. It held on to sums
that were otherwise due and owning to Comstock for work performed; and when the
contractor inquired as to the shortcomings in its classification of workers,
the labor compliance investigator replied that the “classification descriptions
include general information and are not specific ….” For all intents and purposes, the MnDOT-OCIC
said: “Guess.”
No one would want to face government officials who withheld one’s
earnings, for a period of nine years, on the claim that one failed to act in
accordance with provisions of the law that do not exist. In this case, MnDOT-OCIC acted far below the
standard of fair dealing.
The best result is for
the Commissioner to do what lower-level officials did not: Wipe this slate clean. The Commissioner should abandon MnDOT-OCIC’s claim
for back wages and release the contract amounts that the Department has
retained.
E. L. L.
[1] Exhibit 3 at DLI 573.
[2] Ex. 2 at DLI 502; Ex. 203; Evidentiary Hearing Transcript (“Tr.”) at 837-38.
[3] Tr. at 41-50.
[4] Tr. at 166-69.
[5] See, Ex. 2, Section 00800 at DLI 536.
[6] Ex. 2 at DLI 553– 58; compare also, Minn. R. 5200.1040.
[7] Ex. 2 at DLI 551-58; Tr. at 159-60, 262-64 and 1845-46.
[8] Ex. 2 at DLI 550.
[9] See, Ex. 2 at DLI 550-52.
[10]
[11] Tr. at 908 and 1364.
[12] Tr. at 1045, 1180, 1231, 1757-58, 1814 and 2050.
[13] Tr. at 1045, 1180, 1757-58, 1795, 1814 and 2050.
[14] Tr. at 178-79, 230 and 1757-58.
[15] See, Tr. at 545.
[16] Tr. at 1186, 1189, 1191-92, 1216 and 1249-50;
compare
also, Ex. 718 (“Defined and
undefined jurisdiction may vary by area of the
[17]
[18]
[19]
[20] Tr. at 176-77, 230, 665-67, 670, 674-75, 698-700, 708, 772-73, 7898-802, 1027, 1045, 1212-13, 1218-19, and 1602-04; compare also, Ex. 718 (“each specific trade wants to have jurisdiction over as many tasks as possible”).
[21] Tr. at 1062-63.
[22] Tr. at 672-74, 1061-61
[23] Tr. at 223-24, 280, 724, 762, 1603, 1763-64 and 1796.
[24] Tr. at 177, 1920-22 and 2091; see also, 1622 and 1729.
[25] Ex. 718; Tr. at 206-08 and 213-15; see also, Tr. 545-46 and 1114. In some of the documents in the hearing record, Ms. Wilder is listed by her former name, Roxanne Farnham. See, Tr. at 526.
[26] Tr. at 206-08, 213-15, 546, 799-801, 812, 1212-13, 1218-19, 1604-05, 1796 and 2093-94.
[27] Tr. at 2046-67.
[28] Tr. at 1098-99 and 1278-79.
[29] See, Tr. at 2089 and 2113-15.
[30] Ex. 2, Section 00810, Paragraphs 1.23 (F), 1.24 (B)(3) and 1.24 (B)(5) at DLI 550-51; Ex. 750; see also, Tr. at 267-70, 1071 and 1277.
[31] Compare, Ex. 721 with Exs. 719, 727, 732, 750, 758 and Tr. at 1071, 1092-93, 1277 and 2133-34.
[32] Ex. 750; see also, Tr. at 1092-93 and 1277.
[33] Compare, Exs. 719, 727, 732, 750, 758, Tr. at 533-43, 577-78 1092-93 and 1277 with Minn. Stat. § 14.02, subd. 4 (2008).
[34] Tr. at 302.
[35] Tr. at 303.
[36] Tr. at 356; see also, Tr. 528 and 2149; Ex. 731 (“[M]any of the contractors are just wanting to pay what you are saying, without challenging any decision, just to get this project behind them and closed out”).
[37] Tr. at 160, 203-06 and 438.
[38] Tr. at 526-27, 435-37.
[39] Tr. at 441; compare generally, Ex.
792-A.
[40] See, Ex. 6.
[41] Tr. at 45.
[42] Tr. at 48-50.
[43]
[44] Tr. at 132 and 2170.
[45] Tr. at 840-50 and 1326-29.
[46] Tr. at 848-49.
[47] Tr. at 1325.
[48] Tr. at 1325 and 1392-93.
[49] Ex. 792-A; Tr. at 161-62.
[50] Ex. 7 (Construction Meeting No. 1); Tr. at 324, 326, 455-56 and 555-56.
[51] Ex. 705; Tr. at 1257 and 1420-21; see also, Tr. 1146-47.
[52] Exs. 704 and 705; Tr. at 361.
[53] Exs. 6 and 705; Tr. at 1420-21; see also, Ex. 7 (Minutes of Construction Meetings 17, 18 and 19).
[54] See, Tr. 1420-21.
[55] Tr. at 1266-67.
[56] Ex. 706.
[57] Ex.
706; see also, Ex. 731.
[58]
[59] Exs. 704 and 705.
[60] Tr. at 369-70.
[61] Ex. 706.
[62] Ex. 707; Tr. at 1423-24.
[63] Exs. 707 and 712; Tr. at 1163-64, 1294-99 and 1429.
[64]
[65] Exs. 711, 716, 715, 717, 718, 719, 720, 721; see also, 722, 724, 734, 735, 736, 743 and 744.
[66] Ex. 714.
[67] Exs. 715 and 716.
[68] Ex. 733.
[69] Ex. 718.
[70] Ex. 719.
[71] Ex. 720; Tr. at 1651-55.
[72] Ex. 721.
[73] Tr. at 1879.
[74] Exs. 725 and 726; Tr. at 180-82.
[75] Ex. 733; Tr. at 577.
[76] Ex. 734.
[77] Exs. 735 and 736.
[78] Ex. 737.
[79] Ex.
711; Tr. at 1992; see also, Tr.
at 369-70.
[80] Ex. 738; Tr. at 1267, 1432-33, 1435, 1438-39, 1659 and 1666-67.
[81] Ex. 745.
[82] Exs. 746, 749, 751, 752, 754, 755 and 759.
[83] See, Exs. 752 and 753.
[84] Ex. 756.
[85] Ex. 760.
[86] Ex. 760; Tr. at 2155.
[87] See, id.
[88] Ex. 716; Tr. at 162.
[89] Notice of and Order for Hearing, at 3.
[90] Tr. at 630; see also, Tr. at 1115-17.
[91] Ex. 2 at DLI 535-36; Ex. 737; Ex. 742.
[92] Tr. at 438 and 530.
[93] See, Ex. 200-A (analysis of Mike Pittman’s duties on September 15, 2000), 719 and 769; Ex. 792-A (Mike Pittman’s Time Card of September 15, 2000); see also, Tr. at 1899.
[94] Exs. 200-A and 768; Tr. at 769 and 1196-97.
[95] Exs. 745, 753, 766 and 768; Tr. at 494 and 1070.
[96] Ex. 766; Tr. at 1154-61.
[97] See, id.
[98] Compare, Exs. 200-A, 743, 744, 745, 756, 760, 763 and 764.
[99] Tr. at 529 and 531.
[100] Tr. at 531 and 1072-73.
[101] Tr. at 1135-36.
[102] Tr. at 529 and 1146.
[103] Tr. at 1375-91.
[104] See, Tr. at 529 and 1146.
[105] Compare, Tr. at 528 with Tr. at 2089 and 2113-15.
[106] Tr. at 1135-35 and 1153-54; compare also Tr. at 2113.
[107] See, Tr. at 1146; see also, Tr. at 1153, 1899-1903, 1992 and 2113-15.
[108] Ex. 765 at 3; Tr. at 1033-34, 1182-83, 1792-93, 1607-08, 1542, 1545 and 1797; see also, 2102-04 and 2132.
[109] Compare, Tr. at 1146 with Ex. 765 at 3; Exs. 800-A, 800-B and 800-C; Tr. at 1418-20, 1517-18, 1555, 1607-08, 1792 and 1798.
[110] Ex. 800-C; Tr. at 1141-42.
[111] Tr. at 1947-48; see also, Tr. at 1902-04.
[112] Exs. 200-A, 719 and 768; Tr. at 1137-39 and 1680.
[113] Ex. 790; Tr. at 550-52.
[114] Ex. 200-A; Tr. at 1693-96.
[115] Ex. 2 at DLI 557-58; Ex. 782 – Photographs B and C; Tr. at 1127 and 1409.
[116] Ex. 200-A; Tr. at 1691-92.
[117] Ex. 200-A; Tr. at 1691.
[118] Ex. 200-A; Tr. at 1700.
[119] Exs. 200-A.
[120] Exs. 200-A; Ex. 701-B; (Hanson Time Card of September 20, 2001); compare also, 701-E (Siemenewski Time Card of April 23, 2001); Tr. 1677 and 1701-02.
[121] Tr. at 415; compare also, Tr. at 547, 2081-82 and 2089 and 24 State Register 396 (September 20, 1999).
[122] Tr. at 1566, 1807-08, 1879, 2081 and 2089.
[123] Tr. at 1845; compare also, Tr. at 1790-91 and 1823.
[124] See, L&D Trucking v.
[125] See, AAA Striping Service Co. v.
[126] See, Ex. 784 at 63.
[127] Tr. at 1857, 1871-73, 1894-95 and 1939.
[128] Tr. at 1852-53 and 1869-70.
[129] Ex. 793; Tr. at 1852-53 and 2081.
[130] See, Tr. at 1869-72; 24 State Register 396 (September 20, 1999); see also, AAA Striping
Service Co. 681 N.W.2d 717-18 ("We have already noted that DOLI has
actually commenced a rulemaking proceeding to consider changes to the Master Job
Classifications used in the MnPWL for several types of work including ‘new
classes or altering the classifications applying to painting and striping of
roads’ …. In any event, almost three years later this rulemaking process is
unfinished and possibly dormant") and 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 at 3 and 7 (September 28, 2008) (http://www.oah.state.mn.us/aljBase/190019710.final.rr.htm).
[131] See, 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,
[132] Exs. 150, 151, 152 and 793; Tr. at 282, 329-31, 793 and 806-07.
[133] Tr. at 204, 547, 548 and 1054-55.
[134] Ex. 151; compare also, Tr. at 345-46, 667-68, 707, 1015, 1017-18, 1027-28, 1037 and 1054.
[135] Ex. 151; Tr. at 708, 1041 and 1048.
[136] Tr. at 1037 and 2096.
[137] Notice of and Order for Hearing, at 5.
[138] Exhibit A to the Affidavit of Michael L. McCain (May 27, 2009); compare also, Minn. R. 1400.6700 (2007).
[139] See, Exs. B and F to the Affidavit of Michael L. McCain.
[140] See, Exs. C and D to the Affidavit of Michael L. McCain.
[141] Third Pre-Hearing Order, In the Matter of the
[142] See, Ex. F to the Affidavit of Michael L. McCain.
[143] Recommendation on Motion for Summary Disposition, supra, at 1 and 10.
[144] Affidavits were received from Gerhard P. Bergmann, Jim P. Gustafson, John McDowall, Steve R. Newby, John W. Quarnstrom, Rob Snider and Charles B. Witt.
[145] See, Ex. I to the Affidavit of Michael L. McCain.
[146] Seventh Pre-Hearing Order, In
the Matter of the
[147] Recommendation on Motion for Summary Disposition, supra, at, at 8.
[148] In the Matter of the
[149]
[150] In the Matter of the
[151] Fourth Pre-Hearing Order, In
the Matter of the
[152] Fifth Pre-Hearing Order, In the Matter of the
[153] Stipulation and Amended Scheduling Order, In
the Matter of the
[154]
[155] Recommendation on Motion for Summary
Disposition, In the Matter of the
[156] Seventh Pre-Hearing Order, In
the Matter of the
[157] Digital
Recording, In the Matter of the
[158] Seventh Pre-Hearing Order, at 8-9; see also, Tr. at 105-119.
[159] Tr. at 98-108.
[160] Tr. at 513 and 1077.
[161] Seventh Pre-Hearing Order, at 9; Ex. 200-A; Tr. 510-11.
[162] Tr. at 513, 1077, 1141 and 1235.
[163] Tr. at 515-21, 628-30 and 1077.
[164] Tr. at 515-21 and 625-30.
[165] Tr. at 245-46.
[166] Tr. at 244-45.
[167] Exs. 791-A and 791-B; Tr. at 244-49.
[168]
[169] Minn. Stat. § 177.44, subds. 3 and 4.
[170]
[171] See, Exs. 711, 716, 715, 717, 718, 719, 720, 721, 722, 724, 734, 735, 736, 743 and 744; Tr. 368-72, 1647, 1649-55, 1807-08 and 1879.
[172] Tr. at 798-99 and 1308-09.
[173] Minn. Stat. § 177.44, subd. 7.
[174] Minn. Stat. § 177.44 (1) (2008) (emphasis added).
[175] Compare
generally, Minn. Stat. § 645.08 (3) (“general
words are construed to be restricted in their meaning by preceding particular
words”);
[176] Watson Constr.
Co. v. City of
[177] Compare, State ex rel. Spannus v. McGuire Architects-Planners, Inc., 245 N.W.2d 218, 221-22 (Minn. 1976) (statutory authorization for arbitration of disputes in state highway contracts was not a prohibition of a state agency obtaining an arbitration clause in a contract for the construction of a state building); compare also, Lucus v. Am. Family Mut. Ins., 403 N.W.2d 646, 648-49 (Minn. 1987) (there being no “negative terms importing a plain legislative intent that acts authorized therein are to be performed in a prescribed manner,” the contracting parties were permitted to set the terms of arbitration by mutual agreement).
[178] Ex. 2, Section 00810 at DLI 551 (emphasis added).
[179] Ex. 2, Section 00800 at DLI 533.
[180]
[181] Dunne v. Libbra, 330 F.3d 1062, 1064 (8th Cir. 2003) (a forum selection clause that provided “the parties consent to [the jurisdiction of] the state courts of the State of Illinois,” and did not use the words “exclusive,” “only,” “must,” or any other terms that might suggest exclusivity, “[t]he forum selection clause is permissive”); see also, State ex rel. Spannus, 245 N.W.2d at 222 (“We are not persuaded that the fact that the legislature in Minn. Stat. § 3.751 gave private parties a right of action in district court for disputes arising from state contracts necessarily means that the legislature in-tended to preclude the state from attempting to settle contract disputes through arbitration”); Cargill, Inc. v. Lone Star Technologies, Inc., 2003 WESTLAW 230749 (Minn. App. 2003) (unpublished) (where the contract between the parties stated that “Delaware courts 'are to have' jurisdiction ... [t]he plain meaning of the forum-selection clause supports the district court's conclusion that Delaware is a proper forum but not necessarily the sole forum”).
[182] Ex. 2 at DLI 551 (Section 810, Page 9, at Clauses A (1) and B (5)).
[183] See, Southern Minn. Constr. Co. Inc. v. Minn. Dep't of Transp., 637 N.W.2d 339, 344 (Minn. App) review denied (Minn. 2002) ("Before MinnDOT instituted administrative proceedings, [the contractor] could have brought a declaratory judgment action, but once administrative proceedings had begun, [the contractor's] right to bring a declaratory action to arrest those proceedings was foreclosed. Once “enforcement” begins, the proper judicial review is by certiorari of the commissioner's final determination").
[184] Compare, Minn. Stat. § 177.44 (4) (2008) (A person aggrieved by a decision of the commissioner [as to prevailing wage rates] after reconsideration may within 20 days after the decision petition the commissioner for a public hearing as in a contested case under sections 14.57 to 14.61”).
[185] See, Ex. 760; Digital Recording of the Pre-Hearing Status Conference of May 20, 2009, In the Matter of the MnDOT Detroit Lakes Regional Headquarters, OAH Docket No. 8-3001-17706-2; In the Matter of Bauerly Bros., Inc., OAH Docket No. 12-3000-11993-2 (2002) ("Because of [its failure to pay prevailing wages, or to assure that its subcontractors paid prevailing wages], it is appropriate to require Bauerly Brothers to comply with Minn. Stat. § 177.44 in this matter by paying the identified drivers the shortfall in their wages identified by Mn/DOT, and by other appropriate sanctions determined by the Commissioner").
[186] See, e.g., AAA Striping Service Co. v. Minn.
Dep’t of Transp., 681
N.W.2d 706, 719-20 (
[187] See, Donovan v. Tony and Susan Alamo Foundation, 722 F.2d 397, 404 (8th Cir. 1983) (in a suit under
the Fair Labor Standards Act "an employee has carried out his burden if he
proves that he has in fact performed work for which he was improperly
compensated and if he produces sufficient evidence to show the amount and
extent of that work as a matter of just and reasonable inference[; t]he burden
then shifts to the employer to come forward with evidence of the precise amount
of work performed or with evidence to negative the reasonableness of the
inference to be drawn from the employee's evidence").
[188] See, In the Matter of the Truck Rental Rate Effective
December 20, 2004, OAH Docket No.
12-1900-16601-2 (2005) (http://www.oah.state.mn.us/aljBase/190016601.pho2.htm)
(“Because Petitioners are challenging the
correctness of the truck rental rates established by DLI, the burden is upon
Petitioners to prove the facts at issue by a preponderance of the evidence”).
[189] See, MnDOT-OCIC’s Initial Post-Hearing Brief at 23; see also, Tr. 537.
[190] Compare, Minn. Stat. § 177.41 (2008) (“It is in the public interest that … persons working on public works be compensated according to the real value of services they perform”) and Ex. 2 at DLI 551 (Section 00810, Page 9, at Clause A (1) with Tr. 1114 (Ms. Wilder testifies “I don’t do crew mix … I do task”).
[191] See, MnDOT-OCIC’s Initial Post-Hearing Brief, at 15-17.
[192] Compare, id., with Exs. 4 and 151 at DLI 233-35.
[193] See, Tr. at 645, 683-84, 723-24, 759 and 785-86.
[194] Compare, MnDOT-OCIC’s Initial Post-Hearing Brief, at 15-17 with Ex. 4; Ex.151 at DLI 233-35; Ex. 791 at 121-22; Tr. at 533-34, 577-78, 889, 943-49, 975, 1002, 1004, 1030-35, 1049, 1182-83, 1186, 1193-94, 1195-96, 1207, 1217-18, 1224-27, 1244-45, 1345, 1417, 1542, 1547, 1771, 1779, 1790, 1792-98, 1823-24, 1845, 1899 and 2183-85.
[195] Exs. 704, 705 and 760; Tr. at 560 and 2155.
[196] Compare, MnDOT-OCIC’s Initial Post-Hearing Brief, at 7 with Ex. 2 at DLI 533-38.
[197] See, Tr. at 166-69.
[198] See, Benson v. City of Little Falls, 379 N.W.2d 711, 713 (Minn. App. 1986) ("When a contract bears more than one reasonable interpretation, any ambiguity should generally be resolved against the party who drew the contract"); accord, U.S. v. Standard Rice Co., 323 U.S. 106, 111 (1944) ("We will treat [the federal government] like any other contractor and not revise the contract which it draws on the ground that a more prudent one might have been made"); Corso v. Creighton University, 731 F.2d 529, 533 (8th Cir. 1984) ("[w]here, as here, the contract is on a printed form prepared by one party, and adhered to by another who has little or no bargaining power, ambiguities must be construed against the drafting party"); Drainage Dist. No. 1 of Lincoln County, Neb., v. Rude, 21 F.2d 257, 261 (8th Cir. 1927) ("[W]hen a written contract is entirely prepared by one of the parties, and accepted, as thus prepared, by the other, any doubt as to the meaning of its provisions is to be resolved against the party preparing it").
[199] See, Ex. 151.
[200] See,
MnDOT-OCIC’s Initial Post Hearing Brief, at 8 (“the words carpenter,
laborer, ironworker, sheet metal worker, cement mason and roofer … are commonly
used and have common meanings”); Tr. at 645, 683-84, 723-24, 759 and 785-86.
[201] See, Ex. 151 at 1 (the representatives of the affected Building Trades unions “brought their practical experience to the table when it came time to define the work of their crafts…. Consensus over an issue like trade definitions is not easy to reach”).
[202] See, e.g., Tr. at 708-09, 1041 and 1048.
[203]
[204] Exs. 150 and 793.
[205] Ex. 151.
[206] See,
Markwardt v. Water Resources Bd., 254 N.W.2d 371, 374-75 (
[207] In re
Space Center Transport, 444 N.W.2d 575, 581 (Minn. App. 1989) (citing Motor Vehicle Mfgrs. Ass’n v. State Farm
Mutual Automobile Ins. Co., 463
[208] See, Findings 55 – 59, 83 and 86 – 87, supra.
[209] See, Findings 93 – 94 and 97 – 112, supra.
[210] See, Findings 50, 51, 52, 61 – 64, 75 – 76, 86 – 88 and 114 – 122, supra.
[211] See, Findings 69, 70, 79, 81, 84, 85 – 87, 90, 95 – 112 and 114 – 122, supra.
[212] See, e.g., MnDOT-OCIC’s Initial Post Hearing Brief, at 13-14.
[213] See,
[214] See,
AAA Striping Service Co. v.
[215] See, Exs. 718 and 719.
[216] See,
Dullard v.
[217] See,
In the Matter of the Application of Crown
CoCo, 458 N.W.2d at 138;
[218] See, 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
8-1900-19710-1 at 8 (September 28, 2008) (http://www.oah.state.mn.us/aljBase/190019710.final.rr.htm).
[219] See, In the Matter of Proposed Amendments to
Rules Governing Apprenticeship Wages, OAH Docket No. 7-1900-17022-1 at 2
and 6 (http://www.oah.state.mn.us/aljBase/190017022.rr.htm).
[220] Compare, Exs. 719, 726, 750, 758 and Tr.
at 1071, 1092-93, 1277 and 2133-34 with
[221] See, Monk & Excelsior, Inc. v.
[222] Compare, Comstock’s Initial Post-Hearing Brief, at 57-59, 63 and 69-70 with Hard Times Café, Inc. v. City of Minneapolis, 625 N.W.2d 165, 171 (Minn. App. 2001) (an ordinance "is void due to vagueness if it defines an act in a manner that encourages arbitrary and discriminatory enforcement, or the law is so indefinite that people must guess at its meaning"); compare also, State v. Robinson, 539 N.W.2d 231, 236-37 (Minn. 1995).
[223] See, id.
[224] Minn. Chamber
of Commerce v. Minn. Pollution Control Agency, 469 N.W.2d 100, 107 (Minn.
App.), review denied (
[225] Grayned
v. City of Rockford, 408
[226] See,
Hard Times Café, Inc., 625 N.W.2d at 171; Humenansky v. Minnesota Bd. of Md. Exam’rs, 525 N.W.2d 559, 564
(Minn. App. 1994), review denied (
[227] See, Neeland
v.
[228] See,
[229] See, e.g.,
State v. Bourke, 718 N.W.2d 922, 926 (Minn. 2006) (“We generally avoid
ruling under the constitution if there is another basis upon which a case can
be resolved”); Erlandson v. Kiffmeyer, 659 N.W.2d 724, 732 n.7 (Minn. 2003) (“Our general
practice is to avoid a constitutional ruling if there is another basis on which
a case can be decided”); In re Senty-Haugen, 583 N.W.2d 266, 269 n.3
(Minn. 1998) (“It is well-settled law that courts should not reach
constitutional issues if matters can be resolved otherwise”).
[230] Stipulation and Amended Scheduling Order, In
the Matter of the
[231] See, Minn.
R. 1400.6700, subpart 3 (2007) (“Upon the failure of a party to reasonably
comply with an order of the judge made pursuant to subpart 2, the judge may
make a further order as follows ... an order refusing to allow the party
failing to comply to support or oppose designated claims or defenses, or
prohibiting that party from introducing designated matters in evidence).
[232] Compare, Tr. at 107-08 with Beaty
v.
[233] Seventh Pre-hearing Order, In
the Matter of the
[234] Ex. 791.
[235] Henkel v. XIM Products, Inc., 133 F.R.D. 556, 557 (D. Minn. 1991) (emphasis added and citations omitted).
[236] See, McKnight By and Through Ludwig v.
Johnson Controls, Inc., 36
F.3d 1396, 1410 (8th Cir. 1994); DeLuryea
v.
[237]
[238] See, Tr. at
184.
[239] See, Tr. at
11 and 629-30; compare also, Tr. at
67-68.