The opinion of the court was delivered by: EDWIN M. KOSIK
Before the court in each of the above-captioned actions are cross-motions for summary judgment. The issues to be decided in these motions are identical, and therefore will be discussed in this joint Memorandum.
The Pennsylvania Prevailing Wage Act, 43 Pa. Stat. Ann. §§ 165-1 et seq. [the "Act" or the "Prevailing Wage Act"], and its accompanying regulations published at 34 Pa. Code 9.101 et seq., require contractors on public works projects to pay their employees the prevailing wages for the locality where the project is located. 43 Pa. Stat. Ann. §§ 165-4, 165-5, 165-6. The Secretary of Labor and Industry is required to determine the general prevailing minimum wage rate for the locality where the project is located "for each craft or classification of all workmen needed to perform public work contracts" for the duration of the project. 43 Pa. Stat. Ann. § 165-7. In determining the prevailing wage rate, contributions toward employee benefits made pursuant to a bona fide collective bargaining agreement are to be considered and integral part of the wage rate. Id. The Act sets minimum wage rates to be paid on public works projects. It does not prevent contractors from paying wages in excess of those rates. Id.
No credit for contributions for employee benefits exceeding the maximum established by the predetermination shall be given and no payment in one or more employee benefit categories shall be off-set against an underpayment in wages.
An example of how the Prevailing Wage Act works is illustrative. Under the Act, for a specific project, the Secretary may determine the prevailing rate to be $ 20 an hour in wages and $ 5 an hour in fringe benefits. If an employer, pursuant to a collective bargaining agreement, pays employees $ 16 an hour in wages and $ 10 an hour in fringe benefits, however, it receives no credit for the higher payment in benefits. Under this example, the employer would be obligated to provide an additional $ 4 per hour in wages in order to be in compliance under the Act. Such a result may cause employers to attempt to bargain for lower benefit payments with the members of the collective bargaining group it seeks to employ on this project.
The plaintiff in Civil Action Number 92-0459, Keystone Chapter, Associated Builders and Contractors, Inc., in representation of its members ["Keystone Chapter"], filed a complaint on April 8, 1992, seeking injunctive relief against defendant Thomas P. Foley, in his capacity as Secretary of Labor and Industry for the Commonwealth of Pennsylvania ["Foley"]. The gravamen of Keystone Chapter's complaint is that the Prevailing Wage Act is preempted by the Employee Retirement Income Security Act, 29 U.S.C. §§ 1001 et seq. ["ERISA"].
Plaintiffs in Civil Action Number 92-1105, Bell Telephone Company of Pennsylvania ["Bell"] and Communication Workers of America, AFL-CIO, District 13 ["Communication Workers"], filed their original complaint on August 13, 1992. An amended complaint was filed on December 11, 1992. The defendants in the amended complaint are Foley, and the individual members of the Pennsylvania Prevailing Wage Appeals Board.
The amended complaint, in each of two counts, sought a declaratory judgment that the Prevailing Wage Act was preempted by federal law, either by the National Labor Relations Act, 29 U.S.C. §§ 151 et seq. [the "NLRA"], in Count I, or ERISA, in Count II. By Memorandum and Order dated March 16, 1993, we granted the defendants' motion to dismiss Count I of the complaint, concerning preemption under the NLRA.
All parties in these two actions agree that no question of material fact exists that would prevent the entry of summary judgment on the ERISA preemption issue. Thus, our task is to determine, as a matter of law, ...