184 A.3d 1083
Pa. Commw. Ct.2018Background
- Welsh Leedsworld is a single, integrated manufacturing/office facility at 400 Hunt Valley Road employing ~750 people; the building and parcel straddle the boundary between Washington Township and Upper Burrell Township.
- Both townships impose the $52 local services tax authorized by the Local Tax Enabling Act; historically Upper Burrell retained all collections from Welsh Leedsworld employees.
- Washington Township sued for declaratory relief claiming entitlement to a share of the tax revenue (asserting 50%); Appellees conceded 180 employees primarily work in Washington but otherwise argued allocation should follow where each employee actually performs the majority of work.
- The trial court held an employee’s “place of employment” is the specific location within the facility where the employee works on the first day of the payroll period and allocated taxes by counting 570 employees to Upper Burrell and 180 to Washington.
- The Commonwealth Court reversed, holding that for an integrated facility the “place of employment” is the whole premises (400 Hunt Valley Road) and taxes should be allocated between townships according to the percentage of the property located in each township (28% Washington / 72% Upper Burrell) as shown on the recorded subdivision plan.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether "place of employment" under the Local Tax Enabling Act may be read as the employee's "specific" workstation within an integrated facility, or must be treated as the whole premises when the facility spans political subdivisions | Trial court erred by inserting the word "specific"; "place of employment" should be the integrated facility (400 Hunt Valley Rd) so taxes cannot be parsed by micro-locations | The Act requires tax be paid to the political subdivision where the employee is principally employed / spends majority of work time; therefore allocate by where each employee actually works on the first day of the payroll period | For an integrated facility spanning municipalities, "place of employment" is the whole premises; allocation must reflect the division of the property between political subdivisions (use percentage of parcel in each township) |
Key Cases Cited
- Oliver v. City of Pittsburgh, 11 A.3d 960 (Pa. 2011) (statutory interpretation focuses on plain language)
- Board of Revision of Taxes v. City of Philadelphia, 4 A.3d 610 (Pa. 2010) (courts should avoid interpretations causing absurd or impossible results)
- Kerstetter, 94 A.3d 991 (Pa. 2014) (when statutory language is not explicit, consider legislative purpose and related factors)
- Summit School, Inc. v. Department of Education, 108 A.3d 192 (Pa. Cmwlth. 2015) (court may not add language to a statute)
- Vlasic Farms, Inc. v. Pennsylvania Labor Relations Board, 734 A.2d 487 (Pa. Cmwlth. 1999) (court lacks power to insert words into a statute)
- ICT Group v. Workers’ Compensation Appeal Board, 995 A.2d 927 (Pa. Cmwlth. 2010) (employer’s place of employment includes areas integral to the employer’s business)
- Allegheny Ludlum Corp. v. Workers’ Compensation Appeal Board, 913 A.2d 345 (Pa. Cmwlth. 2006) (adjacent areas can be part of employer premises)
- Fashion Hosiery Shops v. Workmen’s Compensation Appeal Board, 423 A.2d 792 (Pa. Cmwlth. 1980) (means of ingress/egress and entryways may be on employer premises)