Sheet Metal Workers' International Ass'n, Local 104 v. Duncan
176 Cal. Rptr. 3d 634
Cal. Ct. App.2014Background
- Public works contract in 2005 between a community college district and a contractor for HVAC modernization; Russ Will Mechanical, Inc. was the HVAC subcontractor.
- Russ Will fabricates materials at a permanent offsite Hayward facility since 1991, serving various projects, not exclusive to the subject project.
- Employee Neves of Russ Will filed a DLSE complaint seeking prevailing wages for offsite fabrication activities.
- DLSE initially issued a wage assessment; later the department issued a coverage determination that offsite fabrication may be exempt; Local 104 participated in the proceedings.
- Superior Court granted petition for writ of mandate, holding the department erred by relying solely on federal law; remanded to apply Williams framework; Russ Will appealed.
- The Court of Appeal reviewed the department’s coverage determination de novo on pure questions of law, focusing on offsite fabrication’s relation to the public works contract and the contextual statutory framework.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether offsite fabrication at a permanent facility not dedicated to the project is covered by prevailing wage law. | Local 104 contends offsite fabrication is integral to the contract and thus covered. | Russ Will contends offsite fabrication is independent and not in the execution of the contract. | Not covered; offsite fabrication at a permanent facility not tied to the project is not within the execution of the contract. |
| Whether the department’s reliance on federal guidance (Davis-Bacon) is appropriate in determining California coverage for offsite fabrication. | Local 104 argues California law should control, not federal guidance. | Department could use Davis-Bacon guidance for ambiguity; aligns with Sansone and Williams. | Appropriate; reliance on a federal regulation for guidance on permanent offsite fabrication is permissible and consistent with Sansone/ Williams. |
| Whether the department’s longstanding practice supports excluding permanent offsite fabrication from coverage. | Local 104 points to inconsistent department positions. | Department has a consistent pattern of exempting permanent offsite fabrication from coverage. | Department’s longstanding practice supports exemption for permanent, offsite fabrication not tied to the project. |
| Whether the court should defer to department’s interpretation or apply Williams/Sansone framework to determine offsite fabrication coverage. | Local 104 urges Williams framework exclusively. | Court should consider Sansone and Williams as guiding, not controlling; deference to agency warranted. | Court adopts Williams framework as guidance within a broader statutory analysis and defers to department’s interpretation where appropriate. |
Key Cases Cited
- Sansone v. Dep’t of Transp., 55 Cal.App.3d 434 (Cal. Ct. App. 1976) (material supplier/exemption framework; offsite hauling integrated vs. independent)
- Williams v. SnSands Corp., 156 Cal.App.4th 742 (Cal. Ct. App. 2007) (offsite fabrication; three-factor test for integration into construction process)
- City of Long Beach v. Department of Industrial Relations, 34 Cal.4th 942 (Cal. 2004) (guide to independent judgment when statute ambiguous; deference to agency when specialized expertise)
- McIntosh v. Aubry, 14 Cal.App.4th 1576 (Cal. Ct. App. 1993) (standard of review; predictability and precise precedent in public works interpretation)
- Azusa Land Partners v. Department of Industrial Relations, 191 Cal.App.4th 1 (Cal. Ct. App. 2010) (context on precedence and evolution of prevailing wage law)