Inland Empire Chapter of Associated General Contractors of America v. Dear

Decision Date21 February 1996
Docket NumberNo. 93-36022,93-36022
Citation77 F.3d 296
Parties131 Lab.Cas. P 58,091, 19 Employee Benefits Cas. 2703, 3 Wage & Hour Cas.2d (BNA) 168, 96 Cal. Daily Op. Serv. 1131, 96 Daily Journal D.A.R. 1913, Pens. Plan Guide P 23,923 INLAND EMPIRE CHAPTER OF ASSOCIATED GENERAL CONTRACTORS OF AMERICA, a non-profit Washington Corporation; Associated General Contractors of Washington, a non-profit Washington Corporation; Associated Builders and Contractors of Western Washington, a non-profit Washington Corporation; Washington Aggregates and Concrete Association, a non-profit Washington Corporation; Panco Construction, Inc., a Washington Corporation; Shea Construction, a Washington Corporation, Plaintiffs-Appellants, v. Joseph A. DEAR, Director, Department of Labor and Industries of the State of Washington; State of Washington, et al., Defendants-Appellees, and Washington State Building and Construction Trades Council; Spokane Area Electrical Joint Apprenticeship and Training Committee; Inland Empire Plumber, Steamfitter, Refrigeration Fitter Joint Apprenticeship Training Committee, et al., Intervenors.
CourtU.S. Court of Appeals — Ninth Circuit

Jeff B. Kray, Assistant Attorney General, Office of the Attorney General, Olympia, Washington, for defendants-appellees.

William G. Jeffery, Jeffery, Ferring & Jenkel, Seattle, Washington, for plaintiffs-appellants.

Richard H. Robblee, Hafer, Price, Rinehart & Robblee, Seattle, Washington, for intervenors-appellees.

Before: ALARCON, BEEZER and KLEINFELD, Circuit Judges.

Opinion by Judge Kleinfeld.

KLEINFELD, Circuit Judge:

We apply our recent decision in Dillingham Const. N.A., Inc. v. County of Sonoma, 57 F.3d 712 (9th Cir.1995), cert. granted, --- U.S. ----, 116 S.Ct. 1415, --- L.Ed.2d ---- (1996), to a similar Washington regulatory scheme.


Plaintiffs are associations of construction contractors and a school. They sponsor training programs, in the nature of apprenticeships, for carpenters and other craftsmen. The trainees are paid less than journeymen's wages.

The State of Washington has a "Little Davis-Bacon Act," requiring that workers on state public works construction projects must receive the "prevailing rate." RCW 39.12.020. There is an exception for apprentices, who can be paid the prevailing rate for apprentices in the trade. RCW 39.12.021. That is the provision the contractors want to take advantage of with their training program. But the exception operates only if the apprenticeship program has been approved by the state apprenticeship council. Id. If the apprenticeship program is not state approved, then the apprentices have to be paid as much as "a fully qualified journey level worker." Id.

The training programs at issue are approved by the United States Department of Labor, Employment and Training Administration, Bureau of Apprenticeship and Training. Federal law provides, in the Fitzgerald Act, for the Secretary of Labor to "bring together employers and labor for the formulation of programs of apprenticeship," and to "cooperate with State agencies engaged in the formulation and promotion of standards of apprenticeship." 29 U.S.C. § 50. Federal Davis-Bacon regulations permit paying less than the prevailing wage to apprentices and trainees in programs registered with the federal Bureau of Apprenticeship and Training, or with a state apprenticeship agency recognized by the federal bureau. 29 C.F.R. § 5.5(a)(4).

The programs are not approved by the Washington state council. After an unsuccessful effort in 1987, plaintiffs have not sought state approval again. The practical effect of the lack of state approval is that plaintiffs do not employ trainees on state public works projects. They have to pay journeymen's wages, so they employ journeymen. In addition, employer contributions to the contractor-sponsored trainee programs are not counted as "usual benefits" for purposes of a Washington regulation, WAC 296-127-014, because the programs are not approved by the state council.

Plaintiffs brought an action seeking declaratory and injunctive relief against Washington and its Department of Labor and Industries. They claim that (1) the state provisions denying the exemption from the state little Davis-Bacon Act and "usual benefits" provision only for state-registered apprenticeship programs are preempted by ERISA; (2) the state little Davis-Bacon Act is itself preempted by the federal Davis-Bacon Act, 40 U.S.C. § 276a et seq., for public works projects funded jointly by state and federal authorities; (3) the state administrative provisions violate state law. The Washington State Building

                and Construction Trades Council, a group of labor unions and state-registered apprenticeship programs, intervened on the side of the state.   The district court denied Inland Empire's first two claims, holding that preemption did not apply to the laws and regulations at issue, and declined to exercise supplemental jurisdiction over the state-law claims

Submission of this case was deferred, pending our decision in Dillingham Const. N.A., Inc. v. County of Sonoma, 57 F.3d 712 (9th Cir.1995), cert. granted, --- U.S. ----, 116 S.Ct. 1415, --- L.Ed.2d ---- (1996). Now that Dillingham has been decided, it controls the outcome of Inland Empire's ERISA preemption claim. The Washington scheme here is indistinguishable from the California scheme we examined in Dillingham. The Washington prevailing wage law and "usual benefits" regulation are preempted by ERISA.

The district court's finding of no preemption is a legal question reviewed de novo. Aloha Airlines, Inc. v. Ahue, 12 F.3d 1498, 1500 (9th Cir.1993). A district court's refusal to exercise supplemental jurisdiction is reviewed for abuse of discretion. Imagineering Inc. v. Kiewit Pacific Co., 976 F.2d 1303, 1309 (9th Cir.1992).

I. Standing and Ripeness.

The appellee State of Washington urges that this court should dismiss this appeal for lack of jurisdiction because Inland Empire does not have standing and the issue is not ripe for review. We review ripeness and standing de novo. Gemtel Corp. v. Community Redevelopment Agency, 23 F.3d 1542, 1545 (9th Cir.1994) (ripeness); Barrus v. Sylvania, 55 F.3d 468, 469 (9th Cir.1995) (standing).

This issue is controlled by our decision in ABC National Line Erection Apprenticeship v. Aubry, 68 F.3d 343, 345 (9th Cir.1995). There we held that the program not approved by the state "suffered direct injury due to the discouragement of unapproved programs," and that the state scheme "hampers ABC Trust's ability to receive funds from California projects." Id. at 346. The cases are on all fours.

The injury to plaintiffs is that the state will not allow them to put their trainees on public works projects at apprentice rather than journeyman wages. The injury is not that the state wrongfully denied their applications for approval, so ripeness is not implicated by plaintiffs' failure to seek state approval. Cf. Gemtel Corp. v. Community Redevelopment Agency, 23 F.3d 1542, 1545-46 (9th Cir.1994). If plaintiffs are correct about preemption, as we conclude below, then their federal approval makes it unnecessary to obtain state approval. Washington's conditioning of its apprenticeship exception to its little Davis-Bacon Act on state approval injures federally approved training programs, whether or not they could obtain state approval. Cf. Sayles Hydro Assoc. v. Maughan, 985 F.2d 451, 454 (9th Cir.1993). Plaintiffs should not be left to speculate whether the Washington prevailing wage scheme is preempted by ERISA. Cf. E.P.A. v. National Crushed Stone Ass'n., 449 U.S. 64, 72 n. 12, 101 S.Ct. 295, 301 n. 12, 66 L.Ed.2d 268 (1980).

II. ERISA Preemption.

Dillingham controls on the preemption issue. We held in Dillingham that ERISA preempts such a state apprenticeship scheme. Dillingham, 57 F.3d at 719. We further held that the ERISA savings clause in combination with the Fitzgerald Act would not save the state scheme from ERISA preemption, Id. at 719-21, nor would the theory that the state was acting as a market participant in its proprietary capacity. Id. at 721-22.

The State of Washington and the Unions make no attempt to argue that the Washington scheme differed in any material respect from the California scheme before us in Dillingham. 1 Rather, they argue that Dillingham was mistaken, because it was inconsistent with New York Conference of Blue Cross v. Travelers Ins. Co., --- U.S. ----, 115 S.Ct. 1671, 131 L.Ed.2d 295 (1995). We have considered and rejected this argument in ABC, 68 F.3d at 347. We pointed out there that contractors "must find a state approved program or forego using apprentices," because of the public works bid process. Id., 68 F.3d at 347. In Travelers, the state scheme "affect[s] only indirectly the relative prices of insurance policies," --- U.S. at ----, 115 S.Ct. at 1683, but the Washington apprenticeship scheme affects directly the practicality of federally approved apprenticeship programs not approved by the state.

Travelers holds that a "law 'relates to' an employee benefit plan, in the normal sense of the phrase, if it has a connection with or reference to such a plan." Travelers, --- U.S. at ----, 115 S.Ct. at 1677. The Washington apprenticeship scheme does. The district court used the "purport to regulate" test from Martori Bros. Distributors v. James-Massengale, 781 F.2d 1349, 1356, amended, 791 F.2d 799 (9th Cir.1986), overruling recognized by Fresh International Corp. v. Agricultural Labor Relations Bd., 805 F.2d 1353, 1357 & n. 3 (9th Cir.1986), but Ingersoll-Rand Co. v. McClendon, 498 U.S. 133, 111 S.Ct. 478, 112...

To continue reading

Request your trial
21 cases
  • Howard Jarvis Taxpayers Ass'n v. Cal. Secure Choice Ret. Sav. Program
    • United States
    • U.S. Court of Appeals — Ninth Circuit
    • May 6, 2021
    ... ... O'Grady (argued), Deputy Attorney General; Paul Stein, Supervising Deputy Attorney General; ... 2012) ; Inland Empire Chapter of Associated Gen. Contractors of Am. v. Dear , 77 F.3d 296, 299 (9th Cir. 1996). The HJTA ... In Stuart v. UNUM Life Insurance Co. of America , 217 F.3d 1145 (9th Cir. 2000), we clarified ... ...
  • Ward v. Management Analysis Co. Employee Disability Ben. Plan
    • United States
    • U.S. Court of Appeals — Ninth Circuit
    • February 3, 1998
    ... ... PLAN, and Unum Life Insurance Company of America, ... Defendants-Appellees ... No. 95-56269 ... Inland Empire Chapter of Associated General Contractors v. Dear, 77 F.3d 296, 299 (9th Cir.1996). We also review ... ...
  • Bohmker v. Oregon
    • United States
    • U.S. Court of Appeals — Ninth Circuit
    • September 12, 2018
    ... ... , in her official capacity as the Attorney General of the State of Oregon; Mary Abrams, in her ... ; for Amicus Curiae United States of America. Marc N. Melnick, Deputy Attorney General; Gavin ... See Ne. Fla. Chapter of the Associated Gen. Contractors of Am. v. City ... See Inland Empire Chapter of Associated Gen. Contractors of Am. v. Dear , 77 F.3d 296, 299 (9th Cir. 1996) (holding a ... ...
  • San Pedro Hotel Co., Inc. v. City of Los Angeles, s. 96-56627
    • United States
    • U.S. Court of Appeals — Ninth Circuit
    • November 6, 1998
    ... ... or made available, or any person associated with that buyer or renter ... , and comity." Executive Software North America, Inc. v. U.S. Dist. Court, 24 F.3d 1545, 1554 ... See Inland Empire Chapter of Associated Gen. Contractors v. Dear, 77 F.3d 296, 299 (9th Cir.1996) ... ...
  • Request a trial to view additional results

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT