The opinion of the court was delivered by: Bonnie Brigance Leadbetter, President Judge
Argued: September 13, 2011
BEFORE: HONORABLE BONNIE BRIGANCE LEADBETTER, President Judge HONORABLE DAN PELLEGRINI, Judge HONORABLE JAMES R. KELLEY, Senior Judge
OPINION BY PRESIDENT JUDGE LEADBETTER
In these consolidated appeals, Bockelman Trucking (Bockelman) and Delliquadri Trucking & Supply, Inc. (Delliquadri) (collectively, Grievants) challenge the final order of the Pennsylvania Prevailing Wage Appeals Board (Board) denying their grievances from the determinations of the Department of Labor and Industry, Bureau of Labor Law Compliance (Bureau) that they must pay prevailing minimum wages to their truck drivers who worked on a public work project, pursuant to Section 5 of the Pennsylvania Prevailing Wage Act (Act), Act of August 15, 1961, P.L. 987, as amended, 43 P.S. § 165-5. Grievants argue that they were not required to pay prevailing minimum wages because the truck drivers did not perform services "directly upon the public work project" under Section 2(7) of the Act, 43 P.S. § 165-2(7), defining a "workman" covered by the Act. Grievants further argue that they were "material suppliers" exempt from the prevailing minimum wage requirement under Section 2(7) of the Act. Because the Board's interpretation of Section 2(7) of the Act is reasonable, we affirm.
The relevant facts are undisputed. In 2006, the Pennsylvania Turnpike Commission invited bids to reconstruct the Pennsylvania turnpike between mileposts 1.85 and 9.29 in two phases: reconstruction of the western portion in Lawrence County (Phase I) and the eastern portion in Beaver County (Phase II). J.B. Fay, Co., chosen as a general contractor for the project, entered into a subcontract agreement with McClymonds Supply & Trucking, which in turn subcontracted work to Dawn, Inc. Dawn Inc. entered into subcontract agreements with Bockelman and Delliquadri, Ohio companies, for "material hauling work." Proposed Facts for Stipulation, ¶¶ 5 and 12; Supplemental Reproduced Record (S.R.) at 380b.
From February to September 2007, the truck drivers employed by Bockelman and Delliquadri drove tandem and tri-axle dump trucks an average of eight hours a day hauling dirt, stones, concrete, gravel, blacktop grindings and shale to and from different locations within the project site. The truck drivers also hauled the materials between the construction site and a dump or borrow pit*fn1
located near the eastbound lane of the turnpike at mileposts 3 or 4. The trucks accessed the project site through the gates on the fences erected along the project site. In addition, the drivers had to use turnaround areas to go from one side to the other side of the construction site because of concrete barriers placed between the eastbound and westbound turnpike lanes. To reach the dump pit, the drivers had to first drive eastbound on the turnpike to the next exit, get off the turnpike, re-enter the westbound lane of the turnpike, drive one or two miles into Ohio to turn around, and then drive eastbound on the turnpike to the pit.
Section 5 of the Act, 43 P.S. § 165-5, provides that "[n]ot less than the prevailing minimum wages as determined hereunder shall be paid to all workmen employed on public work."*fn2 (Emphasis added.) Section 2(7) of the Act defines a "workman" as follows:
[A] "[w]orkman" includes laborer, mechanic, skilled and semi-skilled laborer and apprentices employed by any contractor or subcontractor and engaged in the performance of services directly upon the public work project, regardless of whether their work becomes a component part thereof, but does not include material suppliers or their employes who do not perform services at the job site. [Emphasis added].
The Act requires every public body proposing a contract for any public work project to obtain from the Secretary of Labor and Industry prevailing minimum wage rates for workers providing services on the public work project. Section 4 of the Act, 43 P.S. § 165-4. After consultation with the advisory board, the Secretary determines a general prevailing wage rate in the locality in which the public work is to be performed for each craft or classification of workers. Section 7 of the Act, 43 P.S. § 165-7. The prevailing minimum wage rates must be published in an invitation of bids for a public work project and incorporated into a project contract. Section 4 of the Act. In addition, the contract must "provide that workmen employed or working on the public work shall be paid unconditionally, regardless of whether a contractual relationship exists or the nature of a contractual relationship which may be alleged to exist between a contractor, subcontractor and workmen, at least once a week . the full amounts due at the time of payment .."
34 Pa. Code § 9.103(6) (emphasis added). The prevailing minimum wage rates for each craft and classification of workers must be posted in prominent and easily accessible places "at the site of the work." Section 9 of the Act, 43 P.S. § 165-9.
In February 2006, the Secretary of Labor and Industry determined that total prevailing minimum wages for "truck drivers class 2" driving tandem or tri-axle vehicles in Lawrence County and Beaver County were $32.74 an hour (an hourly wage rate of $22.86 plus a fringe benefit rate of $9.88). See Plaintiff‟s Exhibits 3 and 4; S.R. at 147b, 151b and 153b. In the notice to bidders issued in March 2006, the Pennsylvania Turnpike Commission stated that "[t]he provisions of the . Act ., together with the [prevailing minimum wage] rates and regulations promulgated by the Secretary of Labor and Industry applicable thereto, shall apply to this contract." S.R. at 388b. The prevailing minimum wage rates were incorporated into the project contract and posted on the bulletin board at the construction site.
In August 2008, one of Bockelman‟s truck drivers who worked on the project filed a prevailing wage complaint with the Bureau, alleging that Bockelman paid only $12 an hour, far less than the prevailing minimum wages. After auditing payroll records of Bockelman and Delliquadri for Phase II of the project, the Bureau issued two separate determinations that Bockelman and Delliquadri were required to pay the truck drivers the prevailing minimum wages. The Bureau found that the truck drivers worked directly on the public work project and that their work "appear[ed] to exceed [sic] that of a driver for a material supplier." S.R. at 135b and 140b. Bockelman and Delliquadri filed grievances with the Board challenging the Bureau‟s determinations. Grievants contended that they were not subject to the requirement of the Act because they were "material suppliers," and their drivers did not perform services "at the job site." Grievants also relied on the language in the project contract describing the dump or borrow pit as an "off-site disposal" facility and on the fact that their truck drivers exited the turnpike and entered the State of Ohio to turn around on their way to the pit. S.R. at 421b.
The Board found no guidance from the Act, regulations or Pennsylvania case law as to what constitutes performance of services "at the job site" under Section 2(7) of the Act. The Board then reviewed federal court decisions interpreting the provision of the Davis-Bacon Act, 40 U.S.C. § 276a(a), which requires contractors and subcontractors for a federally funded public project to pay at least prevailing wages to all mechanics and laborers employed "directly upon the site of the work."*fn3 The Board also sought guidance from 29 C.F.R. § 5.2(l)(2), defining the term "the site of the work" to ...