Amicus Curiae Brief — Operating Engineers & Participating Employers Pre-Apprentice v. Weiss Bros. Construction Co.

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FEB 22 1991

. saan OE OF te

No. 90-1191

IN THE

Supreme Court of the United States

OCTOBER TERM, 1990

OPERATING ENGINEERS & PARTICIPATING EMPLOYERS

PRE-APPRENTICE, APPRENTICE AND JOURNEYMAN

AFFIRMATIVE ACTION TRAINING FUND, and

THE OPERATING ENGINEERS JOINT APPRENTICESHIP

COMMITTEE FoR NORTHERN CALIFORNIA,

Petitioners,

Vi

WEIss Bros. CONSTRUCTION Co. dba WEISSCAL, et al.,

Respondents.

On Petition for Writ of Certiorari to the

Court of Appeal of the State of California

BRIEF AMICI CURIAE OF SEVEN APPRENTICESHIP

TRAINING TRUST FUNDS AND U.A. LOCAL NO. 393

IN SUPPORT OF PETITIONERS

JOHN J. D. “Is, JR.*

RAPHAEL SHANNON

NEIL M. GOLDSTEIN

MCCARTHY, JOHNSON & MILLER

Law Corporation

595 Market Street, Suite 2200

San Francisco, CA 94105

(415) 882-2992

Attorneys for Amici Curiae

* Counsel of Record

WILSON - Epes PRINTING Co., INC. - 789-0096 - WASHINGTON, D.C. 20001

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QUESTION PRESENTED

Whether a contract for apprenticeship training between

an employer, a state, and an apprenticeship training trust

fund, operating under a state apprenticeship training pro-

gram recognized by the United States Department of

Labor, is unenforceable by the trust fund because the

Employee Retirement Income Security Act does not ex-

pressly authorize employee benefit trust funds to enforce

such contracts in a private cause of action.

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TABLE OF CONTENTS

INTEREST OF THE AMICI CURIAE ......0000.00000.........

BUMMARS OF ARGUMENT ...............-.......-.cs00.c.c0c00---

REASONS THE WRIT SHOULD ISSUE ....................

I. CERTIORARI SHOULD ISSUE BECAUSE

II.

THE CALIFORNIA COURT OF APPEAL IN-

TERFERED WITH THE OPERATION OF

THE NATIONAL APPRENTICESHIP ACT,

BY IMPROPERLY FINDING ENFORCE-

MENT OF CONTRACTS OF APPRENTICE-

SHIP TRAINING UNDER THAT ACT PRE-

EMPTED BY SECTION 514(a) OF THE EM-

PLOYEE RETIREMENT INCOME SECURITY

THE CALIFORNIA COURT OF APPEAL

ERRED IN FINDING THAT ENFORCEMENT

OF A CONTRACT FOR APPRENTICESHIP

TRAINING “RELATE[S] TO AN EMPLOYEE

BENEFIT PLAN” UNDER SECTION 514(a)

se acc achkth ancl aentiinenitetannbeetiinianbscne

NTE

APPENDIY A

National Apprenticeship Act (Fitzgerald Act),

Section 1, 29 U.S.C. Section 50 ............. Fe EROS

APPENDIX B

California Labor Code, Section 1777.5 _..................

(iii)

1]

la

2a

iv

TABLE OF AUTHORITIES

CASES Page

Associated Builders & Contractors, Inc. v. Mc-

Donald, 731 F. Supp. 966 (D.Nev. 1989) ............ 9

Boise Cascade Corp. v. Peterson, 735 F. Supp.

Se Me I once naepcossisvaeeustnndbnboranncsena 5

Fort Halifax Packing Co. v. Coyne, 482 US. 1, 107

S. Ct. 3211, 96 L. Baa 1 (1967) ........................... 8, 9, 10

Hozier v. Midwest Fasteners, Inc., 908 F.2d 1155

ea anehan 10

Hydrostorage, Inc. v. Northern Calif. Boilermakers

Local Joint Apprenticeship Comm., 891 F.2d 719

(9th Cir. 1989), cert. denied, —— U.S. ——,

111 S. Ct. 72, 112 L.Ed.2d 46 (1990) .....0000000.. 7

Ingersoll-Rand Co. v. McClendon, —— U.S. ——,

111 S. Ct. 478, 112 L.Ed.2d 474 (1990) _....... 8

Mackey v. Lanier Collections Agency, 486 U.S. 825,

108 S. Ct. 2182, 100 L.Ed.2d 836 (1988) 8

Massachusetts Life Ins. Co. v. Russell, 473 U.S.

134, 105 S. Ct. 3085, 87 L.Ed.2d 96 (1985) _...... 8

Moore v. Reynolds Metals Co. Retirement Program,

740 F.2d 454 (6th Cir. 1984), cert. denied, 469

U.S. 1109, 105 S. Ct. 786, 83 L.Ed.2d 780

5 pCR AR CN Rue VE sea a MRE SR ea N yea 9

Musto v. American General Corp., 861 F.2d 897

(6th Cir. 1988), cert. denied, 490 U.S. 1020, 109

S. Ct. 1745, 104 L.Ed.2d 182 (1989) ......... 10

Phillips v. Amoco Oil Co., 789 F.2d 1464 (11th Cir.

1986), cert. denied, 481 U.S. 1016, 107 S. Ct.

1608, 96 L.2a.20 GOO (1967) ................................ 10

Pilot Life Ins. Co. v. Dedeaux, 481 U.S. 41, 107

S. Ct. 1549, 95 L.Ed.2d 39 (1987) ............000000000.... 8

Shaw v. Delta Air Lines, 463 U.S. 85, 103 S. Ct.

3500, T7 L.e.20 490 (1068) ................................ 7

Siuslaw Concrete Const. v. Washington Dept. of

Transportation, 784 F.2d 952 (9th Cir. 1986) .... 5

STATUTES

el eee ee 5

33 U.S.C. Bections $02-268 .......................................... 5

National Apprenticeship Act (Fitzgerald Act) :

ar sien 3-7, 9

Vv

TABLE OF AUTHORITIES—Continued

Taft-Hartley Act: Page

RRB Eo) nn nnn 2

29 U.S.C. Section 186 (c) (6) ....................0.2.0000... 5

Employee Retirement Income Security Act:

29 U.S.C. Section 1001, et seq. ...........0....0....... passim

Section 514(d), 29 U.S.C. Section 1144 (a) ...... 3, 4, 6-8

Section 514(d), 29 U.S.C. Section 1144(d) ....... 3, 6

California Labor Code Section 1777.5 ............00.......... 6, 8

REGULATIONS

29 C.F.R. Sections 29.1-29.13 (1990) ....00020. ee. 4

Be ale es I I ck serie aivtviticeninmaseercacorna 6

LEGISLATIVE HISTORY

H. Rep. No. 93-807, 93rd Cong., 2d Sess. (1974),

U.S. Code Cong. and Admin. News 4670, 4677.... 10

IN THE

Supreme Court of the United States

OCTOBER TERM, 1990

No. 90-1191

OPERATING ENGINEERS & PARTICIPATING EMPLOYERS

PRE-APPRENTICE, APPRENTICE AND JOURNEYMAN

AFFIRMATIVE ACTION TRAINING FUND, and

THE OPERATING ENGINEERS JOINT APPRENTICESHIP

COMMITTEE FoR NORTHERN CALIFORNIA,

Petitioners,

Vv.

WEISS Bros. CONSTRUCTION Co. dba WEISSCAL, et al.,

Respondents.

On Petition for Writ of Certiorari to the

Court of Appeal of the State of California

BRIEF AMICI CURIAE OF SEVEN APPRENTICESHIP

TRAINING TRUST FUNDS AND U.A. LOCAL NO. 393

IN SUPPORT OF PETITIONERS

Come now the Amici Curiae, Pipe Trades District Coun-

cil No. 36 Apprenticeship Training Fund, U.A. Local No.

343 Journeyman and Apprentice Training Trust Fund,

U.A. Local No. 342 Apprenticeship and Training Trust

Fund, Pipe Trades Apprentice and Journeymen Training

Trust Fund for San Mateo County, Insulation and As-

bestos Industry Workers of Northern California and

2

Local No. 16 Apprentice Training Trust Fund, Operative

Plasterers Local Union No. 66 Journeyman and Appren-

tice Training Trust Fund, and Sacramento-Stockton Plas-

tering Industry Joint Apprenticeship and Training Trust

Fund (hereinafter the Trust Funds), and United Associa-

tion of Journeymen and Apprentices of the Plumbing and

Pipefitting Industry of the United States and Canada,

AFL-CIO, Local Union No, 393 (hereinafter U.A. Local

No. 393), and submit this brief in support of the Petition

for Writ of Certiorari in No. 90-1191.

INTEREST OF THE AMICI CURIAE

The Trust Funds are multiemployer trust funds, estab-

lished pursuant to Section 302(c) of the Labor Manage-

ment Relations Act of 1947, as amended, 29 U.S.C. Section

186‘c). All of the Trust Funds are employee welfare

benefit trust funds within the meaning of the Employee

Retirement Income Security Act of 1974, 29 U.S.C. Sec-

tion 1001, et seg. The Trust Funds administer appren-

ticeship training programs which have been approved by

the California Division of Apprentice Standards, which

itself is regulated by the United States Department of

Labor Bureau of Apprenticeship Training. U.A. Local

No. 393 appoints Trustees or directors to two apprentice-

ship training programs approved by the Division of Ap-

prenticeship Standards. The Trust Funds appear on their

own behalf and on behalf of their enrolled apprentice

trainees. U.A. Local No. 393 appears on behalf of its

members who are apprentice trainees in one of the ap-

prenticeship training programs with which it is affiliated.

The Amici’s apprenticeship training programs have

been successfully operating continuously since the 1950’s.

They have trained thousands of apprentices, under rigor-

ous four- or five-year programs. A substantial portion of

the on-the-job experience of these apprentices has beer on

public works of construction. In the operation of their

training programs, the Trust Funds and the U.A. Local

3

No. 393 apprenticeship training programs enter into

numerous tripartite contracts of apprenticeship training,

called DAS-7 agreements, with the State of California and

building and construction contractors on public works jobs

in California. The enforceability of these agreements was

the subject matter of the case at hand. If the Court does

not grant certiorari, and reverse the opinion below, the

Trust Funds and the U.A. Local No. 393 apprenticeship

training programs will not be able to enforce their con-

tracts of apprenticeship training, which will adversely

affect their ability to provide apprenticeship training to

all of the employees covered under their training pro-

grams. Furthermore, the ability of all apprentices,

whether in a union-sponsored apprenticeship program or

not, to gain the on-the-job experience essential to appren-

ticeship training, will be harmed if the State of California

is held to be poweriess to enforce a requirement that con-

tractors employ apprentices as part of their obligation

under their contract for a work of public construction.

SUMMARY OF ARGUMENT

1. The Court should grant certiorari in this case be-

cause the California Court of Appeal has interfered with

the operation of the National Apprenticeship Act (the

Fitzgerald Act), by improperly finding enforcement of

contracts for apprenticeship training under that Act pre-

empted by Section 514(a) of the Employee Retirement

-Income Security Act.

a. The federal laws governing apprenticeship train-

ing establish a system of cooperation among federal

and state governments, employers, and apprenticeship

training programs, under which all of those parties

have duties, in order to fulfill the purposes of the

Fitzgerald Act.

b. As a matter which is regulated by federal law,

contracts for apprenticeship training are saved from

preemption under Section 514(a) of the Employee

Retirement Income Security Act by Section 514(d).

4

2. The California Court of Appeal erred in finding that

enforcement of a contract for apprenticeship training re-

lates to an employee benefit plan under the Employee

Retirement Income Security Act.

a. The Court and numerous lower courts have recog-

nized limitations on the subjcct matter covered under

the Employee Retirement Income Security Act and the

scope of preemption by that Act.

b. A building and construction contractor’s decision

to enter into a contract for apprenticeship training

is a business decision, which is beyond the scope of

the Employee Retirement Income Security Act, and

therefore not preempted by it.

REASONS THE WRIT SHOULD ISSUE

I. CERTIORARI SHOULD ISSUE BECAUSE THE

CALIFORNIA COURT OF APPEAL INTERFERED

WITH THE OPERATION OF THE NATIONAL

APPRENTICESHIP ACT, BY IMPROPERLY FIND-

ING ENFORCEMENT OF CONTRACTS OF AP-

PRENTICESHIP TRAINING UNDER THAT ACT

PREEMPTED BY SECTION 514(a) OF THE EM-

PLOYEE RETIREMENT INCOME SECURITY ACT.

The primary law governing the education of appren-

tices in the United States is the National Apprenticeship

Act of 1937, 29 U.S.C. Section 50, otherwise known as,

and hereinafter referred to as the Fitzgerald Act.

(Appendix A, infra.) In accordance with powers con-

ferred by the Fitzgerald Act, the United States Depart-

ment of Labor, through the Bureau of Apprenticeship

Training, has developed a comprehensive program of

apprenticeship regulations and practices. 29 C.F.R. Sec-

tions 29.1-29.13 (1990).

The history of federal laws on apprenticeship reflects

the intent of Congress to have federal law control the

subject matter, but not to the exclusion of states and pri-

vate parties where they serve federal purposes. In 1937,

5

Congress envisioned that state agencies, employers, and

labor would each have a role in apprenticeship training

programs. This can be seen from the Fitzgerald Act itself

which specifically instructs 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. Section

50.

Although the Court has never addressed the role of the

various parties involved, lower courts have recognized

the cooperative nature of apprenticeship law. For ex-

ample, in Siuslaw Concrete Const. v. Washington Dept.

of Transportation, 784 F.2d 952 (9th Cir. 1986), the

Ninth Circuit upheld state regulation of the wages of

uncertified apprentices on a highway construction project

which was subject to federal regulation under the Fitz-

gerald Act and the Federal Aid-Highways Program, 23 ©

U.S.C. Sections 101-158, and in particular 23 U.S.C. Sec-

tion 113(c), which incorporated certified apprenticeship

programs. See also Boise Cascade Corp. v. Peterson, 735

F. Supp. 1434 (D. Minn. 1990) (upholding state appren-

ticeship training program.)

Since the passage of the Fitzgerald Act, Congress has

altered the role of the various parties involved in ap-

prenticeship training, but has not altered the basic co-

operative nature of the apprenticeship system. The Taft-

Hartley Act of 1947 established the current system of

fringe benefit trust funds, jointly administered by labor

and management. Section 302(c) (6) of the Labor Man-

agement Relations Act of 1947, as amended, 29 U.S.C.

Section 186(c) (6). While this limited the role of labor,

the primary effect has been to institutionalize labor-

management cooperation in the provision of all fringe

benefits, including apprenticeship training.

In 1974, Congress further regulated the roles of em-

ployers, labor and trustees by enacting the Employee

6

Retirement Income Security Act, 29 U.S.C. Sections 1001

et seq. (hereinafter ERISA). ERISA expressly preempts

state laws which relate to an employee benefit plan, with

certain limited exceptions. Section 514(a) of ERISA, 29

U.S.C. Section 1144(a). However, Congress also made it

clear that ERISA was not intended to undermine the

operation of other federal laws:

Nothing in this subchapter shall be construed to alter,

amend, modify, invalidate, impair, or supersede any

law of the United States (except as provided in Sec-

tions 1031 [concerning prior law! and 1137(¢) [con-

cerning the role of employees of the United States in

regulation of private trust funds] of this title, or any

rule or regulation issued under any such law.

FRISA Section 514(d), 29 U.S.C. Section 1144(d). With

respect to apprenticeship training, the effect of Section

514/d) is to preserve the Fitzgerald Act, and the co-

operative system which it established.

The California law at issue, California Labor Code Sec-

tion 1777.5 (Appendix B, infra), is part of that coopera-

tive system. California’s apprenticeship program has been

recognized by the Bureau of Apprenticeship Training,

under Section 29.12 of the Bureau’s regulations issued

under the Fitzgerald Act. Section 1777.5 itself estab-

lishes a cooperative program among the State of Califor-

nia, employers. and apprenticeship training trust funds.

Section 1777.5 requires that contractors on public works

employ apprentices from a_ recognized apprenticeship

training program, and contribute to that training pro-

gram. The DAS-7 agreement is the contract for appren-

ticeship training among the State, the apprenticeship

training program, and the contractor, in which the par-

ties agree to fulfil] their various duties, and which allows

private enforcement if a party fails to fulfill its duties.

Enforcement of DAS-7 agreements by joint labor-

management trust funds is essential to the operation of

this federally-recognized apprenticeship training program

7

and to the purposes of the Fitzgerald Act. Joint trust

funds depend almost exclusively on contributions from

contractors whose employees receive the benefits of the

funds’ apprenticeship programs. If DAS-7 agreements

cannot be enforced, the ability of joint trust funds to pro-

vide apprentice training will be seriously harmed. The

Ninth Cireuit has already denied apprenticeship training

trust funds a federal forum for actions to enforce DAS-7

agreements in Hydrostorage, Inc. v. Northern Calif.

Boilermakers Local Joint Apprenticeship Comm., 891

F.2d 719 (9th Cir. 1989), cert. denied, US. —,

111 S. Ct. 72, 112 L.Ed.2d 46 (1990). The effect of the

decison below in this case would be to prevent apprentice-

ship training trust funds from taking legal action to re-

ceive compensation for training they provide to the em-

plovees of contractors on California public works. Cer-

tiorari should issue, and the opinion below be reversed, to

protect the operation of the Fitzgerald Act through co-

operation between the federal and state governments, em-

ployers and labor. Apprenticeship training in all fifty

states will be crippled until this issue is resolved by this

Court.

Il. THE CALIFORNIA COURT OF APPEAL ERRED IN

FINDING THAT ENFORCEMENT OF A CONTRACT

FOR APPRENTICESHIP TRAINING “RELATE[S}

TO AN EMPLOYEE BENEFIT PLAN” UNDER SEC-

TION 514(a) OF ERISA.

The scope of preemption of state laws by ERISA is lim-

ited to laws which “relate to any employee bene %t plan

..’ ERISA Section 514(a), 29 U.S.C. Section 1144/a).

The Court has declared that Section 1144/a) is to be read

broadly, and encompasses any law which “has a connec-

tion with, or reference to [an employee welfare benefit |

plan.” Shaw v. Delta Air Lines, 463 U.S. 85, 96-97, 103

S. Ct. 2890, 77 L.Ed.2d 490 (1983). A broad reading

of Section 514(a) serves to “round out the protection

afforded participants by eliminating the threat of con-

flicting and inconsistent State and local regulation.” 463

8

U.S. at 99. Broad preemption of state law is particu-

larly relevant when the subject law provides a greater

remedy against a plan than authorized by federal law,

one effect of which would be to reduce the benefits pay-

able to other beneficiaries. Pilot Life Ins. Co. v. Dedeaux,

481 U.S. 41, 107 S. Ct. 1549, 95 L.Ed.2d 39 (1987). See

also Massachusetts Life Ins. Co. v. Russell, 473 U.S. 134,

105 S. Ct. 3085, 87 L.Ed.2d 96 (1985) (No punitive

damages may be awarded against Trustees) ; and /nger-

soll-Rand Co. v. McClendon, USS. , 111 S. Ct.

478, 112 L.Ed.2d 474 (1990) (State law remedy for vio-

lation of employee’s right under ERISA held preempted. )

However, the Court has also recognized limitations on

the preemption of state law by Section 514(a). In

Mackey v. Lanier Collections Agency, 486 U.S. 825, 108

S. Ct. 2182, 100 L.Ed.2d 836 (1988), the Court upheld

the application of a state garnishment law to welfare

benefit plans. The welfare benefits which the state sought

to attach were not within the scope of ERISA’s anti-

alienation clause or otherwise protected from garnish-

ment. The Court was not willing to use Section 514(a)

to expand the anti-alienation clause, which would have

had the effect of preempting a garnishment law of gen-

eral application. 486 U.S. at 836-37.

In Fort Halifax Packing Co. v. Coyne, 482 USS. 1,

107 S. Ct. 2211, 96 L.Ed.2d 1 (1987), the Court also

upheld a state law requiring the payment of severance

pay. The Court rejected the argument that “ ‘plan’

should in effect be read out of [Section 514(a)].” 482

U.S. at 8. The Court drew a distinction between laws

that regulated plans, which were preempted, and those

that regulated only benefits, which were not. Further-

more, preemption of the subject state law would not have

served the purposes of preemption. 482 U.S. at 10-12.

The preemption of California Labor Code Section 1777.5

would not promote any of the policy concerns which led

to the results in the cited cases. First, the threat of in-

9

consistent regulation of apprenticeship training programs

is minimal. No state agency may regulate apprentice-

ship training programs without the approval of the United

States Department of Labor Bureau of Apprenticeship

Training. While there may be variations in training

programs, these are no different from the variations in

the welfare benefits provided under other ERISA-covered

plans.

Second, California Labor Code Section 1777.5 is a law

of general application which should not be preempted by

ERISA. All building and construction contractors who

work on California public works are covered by that law.

However, employers may provide the required apprentice-

ship training in a variety of ways. An employer may

operate its own training program, or enter into an agree-

ment with a joint labor-management trust fund or with

a multiple employer plan (with no labor participation).

See, e.g., Associated Buiiders & Contractors, Inc. v. Mc-

Donald, 731 F. Supp. 966 (D. Nev. 1989). In other

words, the existing apprenticeship training system is a

multi-faceted approach, which does not require contribu-

tions to joint labor-management trust funds. However,

when an employer elects that option, the purposes of

ERISA and the Fitzgerald Act are served by allowing

the trust fund with whom the employer has contracted

for apprenticeship training services to enforce that

contract.

Third, and most importantly, the Court must not allow

the lower courts to abolish the distinction recognized in

Fort Halifax Packing. The primary purpose of ERISA

is to assure the participants and beneficiaries of em-

ployee benefit plans that they would receive the benefits

which an employer has promised to provide. However,

the decision to provide benefits is a business decision,

which is not within the scope of ERISA, and therefore,

not within the scope of preemption by ERISA. See, e.g.,

Moore v. Reynolds Metals Co. Retirement Program, 740

10

F.2d 454, 456 (6th Cir. 1984), cert. denied, 469 U.S.

1109, 105 S. Ct. 786, 83 L.Ed.2d 780 (1985) (“Neither

Congress nor the Courts are involved in the decision to

establish a plan or in the decision concerning which bene-

fits a plan should provide,” citing H. Rep. No. 93-807,

93rd Cong. 2d Sess. (1974), U.S. Code Cong. and Admin.

News 4670, 4677. )

The Court has not had occasion to address this dis-

tinction since Fort Halifax Packing, and some members

of the Court questioned the distinction drawn in that

case when that decision was rendered. 482 U.S. at 23-26,

White, J. dissenting. However, the distinction between

business decisions and ERISA-covered administrative ac-

tions is a valuable tool which courts have used often to

determine where the broad scope of ERISA ends. This

distinction is particularly valuable where there is a fed-

erally-regulated apprenticeship training program, and the

business decision is how an employer will fulfill its ob-

ligations under that program.

Lower courts have applied this distinction in numerous

contexts. For example, in Musto v. American Genera!

Corp., 861 F.2d 897 (6th Cir. 1988), cert. denied, 490

U.S. 1020, 109 S. Ct. 1745, 104 L.Ed.2d 182 (1989), the

Sixth Circuit held that the company’s decision to termi-

nate retiree welfare benefits was a business decision, out-

side the scope of ERISA fiduciary duties. In Phillips v.

Amoco Oil Co., 789 F.2d 1464 (11th Cir. 1986), cert.

denied, 481 U.S. 1016, 107 S. Ct. 1893, 95 L.Ed.2d 500

(1987), the Eleventh Circuit held that the terms of a

purchase and sale agreement were a matter for the em-

ployer acting as employer, and therefore not within the

scope of ERISA. And again in Hozier v. Midwest Fast-

eners, Inc., 908 F.2d 1155 (8rd Cir. 1990), the Third

Circuit held that the company’s decision to terminate a

severance plan was a business decision, and therefore not

covered by ERISA.

11

Just like a decision to provide those other benefits, an

employer’s decision how to provide apprenticeship train-

ing is not covered under ERISA. Extending ERISA pre-

emption to prevent enforcement of DAS-7 agreements

by trust funds encroaches on business decisions not covy-

ered by ERISA, and poses a threat of extending ERISA

itself into matters which Congress clearly intended to be

free from regulation under that Act. The Court can

prevent that result only by granting certiorari and re-

versing the decision below.

CONCLUSION

For the reasons stated above, the Petition for Writ of

Certiorari should be granted.

Respectfully submitted,

JOHN J. DAVIS, JR.*

RAPHAEL SHANNON

NEIL M. GOLDSTEIN

MCCARTHY, JOHNSON & MILLER

Law Corporation

595 Market Street, Suite 2200

San Francisco, CA 94105

(415) 882-2992

Attorneys for Amici Curiae

* Counsel of Record

Dated: February 22, 1991

4

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APPENDICES

la

APPENDIX A

National Apprenticeship Act (Fitzgerald Act),

Section 1,

29 U.S.C. § 50

Section 50. Promotion of labor standards of appren-

ticeship

The Secretary of Labor is authorized and directed to

formula and promote the furtherance of labor standards

necessary to safeguard the welfare of apprentices, to ex-

tend the application of such standards by encouraging the

inclusion thereof in contracts of apprenticeship, to bring

together employers and labor for the formulation of pro-

grams of apprenticeship, to cooperate with State agencies

engaged in the formulation and promotion of standards

of apprenticeship, and to cooperate with the Office of

Education under the Department of Health, Education,

and Welfare in accordance with section 17 of Title 20...

2a

APPENDIX B

California Labor Code,

Section 1775

(West, 1989 Cumul. Pocket Part)

$1777. Employment of registered apprentices; wages;

standards; number; apprenticeable craft or

trade exemptions; contributions

Nothing in this chapter shall prevent the employment

ef properly registered apprentices upon public works.

Every such apprentice shall be paid the standard wage

paid to apprentices under the regulations of the craft or

trade at which he is employed, and shall be employed only

at the work of the craft or trade to which he is registered.

Only apprentices, as defined in Section 3077, who are in

training under apprenticeship standards and written ap-

prentice agreements under Chapter 4 (commencing at Sec-

tion 3070), Division 3, of the Labor Code, are eligible to

be employed on public works. The empicyment and train-

ing of each apprentice shall be in accordance with the

provisions of the apprenticeship standards and apprentice

agreements under which he is training.

When the contractor to whom the contract is awarded

by the state or any political subdivisioa, or any sub-

contractor under him, in performing any of the work

under the contract or subcontract employs workmen in

any apprenticeable craft or trade, the contractor and sub-

contractor shall apply to the joint apprenticeship commit-

tee administering the apprenticeship standards of the

craft or trade in the area of the site of the public work

for a certificate approving the contractor or subcontractor

under the apprenticeship standards for the employment

and training of apprentices in the area or industry af-

fected; provided, however, that the approval as established

by the joint apprenticeship committee or committe2s shall

3a

be subject to the approval of the Administrator of Ap-

prenticeship. The joint apprenticeship committee or com-

mittees, subsequent to approving the subject contractor

or snbcontractor, shall arrange for the dispatch of ap-

prentices to the contractor or subcontractor in order to

comply with this section. There shall be an affirmative

duty upon the joint apprenticeship committee or com-

mittees administering the apprenticeship standards of the

craft or trade in the area of the site of the public work

to ensure equal employment and affirmative action in

apprenticeship for women and minorities. Contractors or

subcontractors shall not be required to submit individual

applications for approval to local joint apprenticeship

committees provided they are already covered by the local

apprenticeship standards. The ratio of apprentices to

journeymen who shall be employed in the craft or trade on

the public work may be the ratio stipulated in the ap-

prenticeship standards under which the joint apprentice-

ship committee operates, but in no case shall the ratio be

less than one apprentice for each five journeymen, except

as provided in this section.

The contractor or subcontractor if he is covered by this

section upon the issuance of the approval certificate, or

if has has been previously approved in such craft or

trade, shall employ the number of apprentices or the ratio

of apprentices to journeymen stipulated in the apprentice-

ship standards. Upon proper showing by the contractor

that he employs apprentices in such craft or trade in the

state on all of his contracts on an annual average of not

less than one apprentice to each five journeymen, the

Division of Apprenticeship Standards may grant a cer-

tificate exempting the contractor from the 1-to-5 ratio

as set forth in this section. This section shall not apply

to contracts of general contractors involving less than

thirty thousand dollars ($30,000) or 20 working days or

to contracts of specialty contractors not bidding for work

through a general or prime contractor, involving less than

4a

two thousand dollars ($2,000) or fewer than five work-

ing days.

“Apprenticeable craft or trade,” as used in this section,

shall mean a chaft or trade determined as an apprentice-

able occupation in accordance with rules and regulations

prescribed by the Apprenticeship Council. The joint ap-

prenticeship committee shall have the discretion to grant

a certificate, which shall be subject to the approval of the

Administrator of Apprenticeship, exempting a contractor

from the 1-to-5 ratio set forth in this section when it

finds that any one of the following conditions is met:

(a) In the event unemployment for the previous three-

month period in such area exceeds an average of 15 per-

cent, or

(b) In the event the number of apprentices in training

in such area exceeds a ratio of 1 to 5, or

(ec) If there is a showing that the apprenticeable craft

or trade is replacing at least one-thirtieth of its journey-

men annually through apprenticeship training, either (1)

on a statewide basis, or (2) on a local basis.

(d) If assignment of an apprentice to any work per-

formed under a public works contract would create a

condition which would jeopardize his life or the life,

safety, or property of fellow employees or the public at

large or if the specific task to which the apprentice is to

be assigned or of such a nature that training cannot be

provided by a journeyman.

When such exemptions are granted to an organization

which represents contractors in a specific trade from the

1-to-5 ratio on a local or statewide basis the member

contractors will not be required to submit individual ap-

plications for approval to local joint apprenticeship com-

mittees, provided thay are already covered by the local

apprenticeship standards.

5a

A contractor to whom the contract is awarded, or any

subcontractor under him, who, in performing any of the

work under the contract, employs journeymen or appren-

tices in any apprenticeable craft or trade and who is not

contributing to a fund or funds to administer and conduct

the apprenticeship program in any such craft or trade in

the area of the site of the public work, to which fund or

funds other contractors in the era of the site of the

public work are contributing, shall contribute to the fund

or funds in each craft or trade in which he employs jour-

neymen or apprentices on the public work in the same

amount or upon the same basis and in the same manner

as the other contractors do, but where the trust fund

adn.inistrators are unable to accept such funds, contrac-

tors not signatory to the trust agreement shall pay a like

amount to the California Apprenticeship Council. The

contractor or subcontractor may add the amount of such

contributions in computing his bid for the contract. The

Division of Labor Standards Enforcement is authorized

to enforce the payment of such contributions to the fund

of funds as set forth in Section 227.

The body awarding the contract shall cause to be

inserted in the contract stipulations to effectuate this sec-

tion. Such stipulations shall fix the responsibility of com-

pliance with this section for all apprenticeable occupa-

tions with the prime contractor.

All decisions of the joint apprenticeship committee

under this section are subject to the provisions of Section

3081.