State Supreme Court limits definition of ‘public work’

The state Supreme Court set limits on what counts as "public work" in two opinions Monday, prompting two dissenting justices to urge the state Legislature to clarify the Labor Code.

Filed by workers assigned to public infrastructure projects, the two cases under review concerned whether they were entitled to prevailing wages for certain aspects of the work. California's prevailing wage law, which is codified in the Labor Code, requires publicly funded construction projects to pay workers wages that are comparable to what the majority of other workers in the same area are paid, for the same type of work.

In Busker v. Wabtec Corporation et al., 2021 DJDAR 8407, the high court held that work on "rolling stock," like train cars, does not qualify as public work -- even if that work is integral to other activity that does qualify as public work.

In Mendoza et al. v. Fonseca McElroy Grinding Co., Inc., et al., 2021 DJDAR 8426, the plaintiffs argued that in order to do work that indisputably counts as public work -- operate heavy machinery -- they had to first transport the machinery to and from the work site. Because that transportation does not qualify as public work, "an employer has no obligation to pay the prevailing wage to those who perform it," the court found.

Justice Carol A. Corrigan wrote both opinions. Justices Mariano-Florentino Cuéllar and Goodwin H. Liu dissented to both.

"Because of the prevailing wage law's critical function in protecting workers employed on public works, we must interpret the law liberally," Cuéllar wrote in the Mendoza opinion. He added the court's majority ruling "encourages public works employers to segment out labor not defined as 'public works,' but nonetheless constituting labor as crucial as it is integral to public works projects, so that they can pay lesser wages."

Liu wrote in Busker, "Although courts applying California law must abide by today's contrary holding, the Legislature need not. It may amend Section 1720, subdivision (a) to make clear that labor that otherwise qualifies as 'public work' is not exempt from prevailing wage protection simply because it does not occur on a fixed structure on land."

Cuéllar agreed, writing in Busker, "I urge the Legislature to amend Section 1772 to restore the settled understanding of the section ... that work 'in the execution of' a public work contract encompasses labor performed in preparation for, in furtherance of, or otherwise bearing a critical relationship to defined public work and the public works project as a whole, and that such labor is therefore subject to prevailing wage protections."

The majority suggested Cuéllar misread the scope of the opinions' impact.

"Justice Cuéllar's dissents in both this case and Mendoza risk mischaracterization of our holdings. Like our holding in Mendoza, the holding here is quite narrow. We merely address the questions posed by the Ninth Circuit," Corrigan wrote.

"Because Justice Cuéllar's dissent here has included reference to the Mendoza case as well, we emphasize again that nothing we say in either case should be read to condone any attempt to ignore the protections or obligations of the prevailing wage law," she added.

The 9th U.S. Circuit Court of Appeals asked the state Supreme Court to review both cases.