# Amicus Curiae Brief — New York State Departmet of Labor v. General Electric Co. > Briefs, arguments, decisions, and more. URL: https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385020_1357%3A4 ## Record - **Collection:** Supreme Court brief - **Document type:** Amicus Curiae Brief - **Published:** January 1, 1990 - **Citation:** 496 U.S. 912 ## Text MOTION FILED MAY 10 1999 No. 89-1590 IN THE Supreme Court of the United States OCTOBER TERM, 1989 NEW YORK STATE DEPARTMENT OF LA ly [AS |] HARTNETT. Commissioner of Labs State « New York: CHARLES DROBNER, Dii' of P Works, New York State Department of Lib Ro ABRAMS, Attorney General of the S f New York, PP? (; \ | i \ | { Ri On Petition for Writ of Certiorari to the United states Court of Appeals for the Second Circuit MOTION OF THE BUILDING AND CONSTRUCTION TRADES DEPARTMENT, AP L-CIO FOR LEAVE TO FILE A BRIEF AMICUS CURIAE AND AND BRIEF AMICUS CURIAE OF THE BUILDING CONSTRUCTION TRADES DEPARTMENT, APL-CIO, IN SUPPORT OF THE PETITIONERS LAURENCE J. C¢ TERRY YELLIG R SHERMAN, DUNN, CO \ LEIFER & YELI P¢ > SS T ] ( IO respe T es To? f t llié at: iccon aT T bh) eT am?) ny rging ? View Oo! ne de $10n he OW ) nor | . Yn ] Hlinge £ +} hy + ro rs) oners ive sented I gr { = orle t IN THE Siypreme Court of the United States OCTOBER TERM, 1989 No. 89-1590 EW YORK STATE DEPARTMENT OF LABOR, THOMAS HARTNETT, Commissioner of Labor of the State F’. of New York: CHARLES DROBNER, Director of Public Works, New York State Department of Labor; Ron! s ABRAMS, Attorney General of the State of New York, Petitioners, v. GENERAL ELECTRIC COMPANY, On Petition for Writ of Certiorari to the United States Court of Appeals for the Second Circuit MOTION OF THE BUILDING AND CONSTRUCTION TRADES DEPARTMENT, AFL-CIO, FOR LEAVE TO FILE A BRIEF AMICUS CURIAE T R Y INTEREST OF THE BUILDING AND CONSTRUCTION TRADES DEPARTMENT FACTS AND QUESTIONS OF LAW DEVELOPED BY THE pi rp TABLE OF CONTENTS TABLE OF AUTHORITIES INTEREST OF THE BUILDING AND CONSTRUC- TION TRADES DEPARTMENT 2 SUMMARY OF REASONS FOR REVIEW Z REASONS FOR REVIEW 3 CONCLUSION 1] ii TABLE OF AUTHORITIES CASES: Action Electrical Contractors Co. v. Goldin, 485 ee. Fe: |} ene AEtna Life Insurance Co. v. Borges, 869 F.2d 142 EAE SAAR. BED svcccssticecdescshneeikid eee Alessi v. Raybestos-Manhattan, 451 U.S. 504 (1981). disséssdekdeshianeresaeioedemeat aaa ee Brang Co. “State University Const. Fund, 365 N.Y.S.2d 914 CREP vnncnexsistioeteae ; Calder v. Bull, 3 U.S. (3 Dall. ) 388 a 798) . Fe Campbell v. City of New York, 244 N.Y. 317 CDE D cicxenvcvcvennynvainveucccudsoveunckscdormuibdancenenamnnnus Fort Halifax Packing Co. v. Coyne, 482 U.S. 1 (1987) ooo cccc cc ccee cece cc ceee cc eeeeeeeeee Hewlitt-Packard Co. v, Barnes, 571 F. 2d 502 (9th Cir. 1978) _ Massachusetts v. Morash, 490 U.S. ——, 104 L.Ed.2d 98 (1989) ssounes Metropolitan Life Ins. Co. v. Massachusetts, 471 U.S, T24 (19BB) 22..2......00c..ccccssceseccnecccccececevecerseses- Rebaldo v. Cuomo, 749 F. 2d 133 (2d Cir. 1984) Schultz v. Nat. Coalition of Hispanic M.H.H.S. Org., 678 F. Supp. 936 (D.D.C. 1988) Shaw v. Delta Air Lines, 463 U.S. 85 (1983) Silverman v. Browning, 414 F. Supp. 80 (D. Conn. ) 1976) , Texas v. White, 74 U.S. (7 Wall.) 700 (1869) | Train v. Colorado Public Interest Research Group, 426 U.S. 1 (1976) United States v. American Trucking Ass’ns., 310 U.S. 534 (1940) Universities Research Assoc. v. Coutu, 450 U.S. 754 (1981) STATUTES: 29 U.S.C. §§ 1021-31 29 U.S.C. $$ 1051-86 29 U.S.C. §§ 1104-14 Davis-Bacon Act, 40 U.S.C. § 276a, et seq. (1986) ol t ~] qn L986) passim LEGISLATIVE MATERIALS 5S. Rep. No. 963, 88th Cong., 2d Sess. (1964) 8 IN THE Supreme Court of the United States OCTOBER TERM, 1989 No. 89-1590 NEW YORK STATE DEPARTMENT Of LABOR, THOMAS F. HARTNETT, Commissioner of Labor of the State of New York; CHARLES DROBNER, Director of Public Works, New York State Department of Labor; ROBERT ABRAMS, Atcorney General of the State of New York, Petitioners, Vv. GENERAL ELECTRIC COMPANY, Respondent. On Petition for Writ of Certiorari to the United States Court of Appeals for the Second Circuit BRIEF AMICUS CURIAE OF THE BUILDING AND CONSTRUCTION TRADES DEPARTMENT, AFL-CIO, IN SUPPORT OF THE PETITIONERS The Building and Construction Trades Department, AFL-CIO, (the “Department’’) submits this brief amicus curiae to urge the Court to review the decision below that ERISA preempts a New York prevailing wage law that does not require an employer to establish, maintain, or modify an employee benefit plan, or even to fringe benefits to its employees. INTEREST OF THE BUILDING AND CONSTRUCTION TRADES DEPARTMENT The nature and purpose of the Department ar forth in the accompanying Motion for leave to file brief. As set forth herein, the Department submits + ih n > sy ] ‘1 —se ,« . ‘ s crwm 1 + ‘ + the decision below will have a significan iv@i st t 1} + 400) ; . *l- Cc Aye rh > ++ +t ye upon construction workers for whose benefi state pre a Tt vailing wages laws have been enacted. The result of th decision below is the effective nullification of New Y: “7 entire preva _ 1 1. | r« ’ . ‘ > ~ . . tT. > r a. + ~ ’ a. app 1caDle irisd 1oOn The highes Cou! lT New Yu rv ~ : ———ee ’ : ore) n haln +¢ha4d : ‘ ca300 has interpreted Section 220 and held that its require- : ‘ ‘ } > ith Nal rs ‘ ha ; ] ments can be satisfied with cash wages, and that it does ye ,117° Qn +r! , . ~~ ve | Ing ‘ TT} not require an employer to provide tringe benefits. Thi — } ] , rnc 01 ° . Y , Tawip 1} , _ court below has reinterpreted New York law, seeming ey i a . . 4B. 4k > + ] . lL, ] ] ~< without regard to the Tenth Amendment, and held it pre- " 1h ° AB 2 , ] Lelawm L es ] empted under ERISA. In so holding, the court ignored it WT 1 ]<] 19] law and micint , ‘Ot 1 +h ] . Its OWN Geclslonal laW and misinterpreted tne decisions Oo! this (Court The qecision pvpelow we0)pardizes tne ng- ; he ls , , | Ase -) ] . n a 4 standing policy of New York and a majority of the states to provide a minimum level of compensation pubiie works projects. ing wage law. The decision portends REASONS FOR REVIEW 1 costs for those contractors will be significantly lower than the labor costs prevailing for local contractors. The result will be to place those local contractors, which are contractually required to provide fringe benefits to their workers, at a competitive disadvantage in bidding on public works projects. This is exactly what the legisla- ture sought to prevent when it amended the New York prevailing wage statute to include the value of supple- ments in the calculation of the value of the prevailing wage. The effect of the decision below is to allow nonlocal and nonunion contractors to pay their employees a total compensation package substantially lower in value than the prevailing rate, in contravention to the state’s long- standing policy “to insure that workmen on public proj- ects will receive an adequate wage,” and to afford “pro- tection to a contractor by giving him some foreknowledge of potential labor costs when bidding on such projects.” Brang Co. v. State University Const. Fund, 365 N.Y.S.24 914 (1975+. See Campbell v. City of New York, 244 N.Y. 317 (1927). Judicial analysis of ERISA’s preemption provision, 29 U.S.C. $1114, begins with the presumption that state laws are not preempted by federal statute in the absence of persuasive evidence to the contrary. Metropolitan Life Ins. Co. v. Massachusetts, 471 U.S. 724, 741 (1985); Alessi v. Rayhestos-Manhattan, 451 U.S. 504, 522 (1981). Having concluded that ERISA’s preemption provision is ‘not a model of legislative drafting,” Metropolitan Life, 471 U.S. at 739, this Court consistently turns to the leg- islative history of ERISA for guidance.” 2 The Court has on numerous occasions expressed its general dis- satisfaction with any “plain meaning” rule: “When aid to construc- tion of the meaning of words, as used in the statute, is available, there certainly can be no ‘rule of Jaw’ which forbids its use, however clear the words may appear on ‘superficial examination.’ Train Colorado Public Interest Research Group, 426 U.S. 1, 10 (1976) Most recently, the Court has highlighted that ERISA preemption reflects Congressional “concern about the ef- fect of state regulation on the administration of benefit programs,” Fort Halifax Packing Co. v. Coyne, 482 US. 1, 10 (1987). “The focus of the statute thus is on the administrative integrity of benefit plans. . . .” Fort Halifax, 482 U.S. at 15. The Court held that ERISA does not preempt a state statute that “creates no impedi- ment to an employer’s adoption of a uniform benefit ad- ministrative scheme * * * [or that] presents no risk either that an employer will evade or that a state will dislodge otherwise applicable federal regulatory require- ments,’ Fort Halifax, 482 U.S. at 14-17. Thus, “the cases stressing the broad reach of the ERISA preemp- tion clause also stress that common sense should not be left at the courthouse door.” Schu/tz v. Nat. Coalition of Hispanic M.H.H.S. Org., 678 F. Supp. 936, 938 (D.D.C. 1988 The preemption of state law under ERISA is a valid exercise of Congress’ power under the Commerce Clause * and does not violate the Tenth Amendment to the Con- stitution. However, the necessary predicate to determin- ing whether ERISA preempts a state law is a determi- nation of the meaning of the state law. And, the inter- pretation of state law has long been recognized as being committed to the states under the Tenth Amendment. See Calder v. Bull, 3 U.S. (3 Dall.) 388 (1798). ‘“Ab- sent proof of prejudice or abuse of discretion, the state courts must be presumed to act in good faith and with judicial wisdom. " Silverman v. Browning, 414 F. Supp. 80, 88 (D. Conn.), aff'd, 429 U.S. 876 (1976 Notwiths*anding the foregoing, in the instant case, the Second Circuit has seemingly rejected the interpretation q / f nag I'n tid States j Ame? CoO) T? ck ne“ As 'ns.. . 10 tT . 54. 545-44 1940 a <2 J + + < - ~ = & — ; m - ° ~ mee — -— - Se 1 = aS ~ f + —! ping oo 4 / — + ~ a onload + ~~ ~~ by ~ .. + — - — - ~ = Le @ aS = -* ae SC = N ae: ae — ff _— ° ~~ - aw / a ~ os ae noe / j — + \ | ) ~ +—~ bus af. + ~ al + ° - ~ oo ri equalize contractors’ minimum labor costs,” 485 N.Y.S.2d at 245, rather than any prohibition against an employer paying its employees in cash the total dollar value of the prevailing wage package. Rather than deferring to the State’s interpretation of its own statute, the Second Circuit assumed the role of interpreter of New York law. In so doing, the Second Circuit blinked past the Tenth Amendment and the es- tablished principles that “the preservation of the states, and the maintenance of their governments, are as much within the design and care of the Constitution as the preservation of the Union and the maintenance of the Na‘ional government.” Texas v. White, 74 U.S. (7 Wall.) 700, 725 (1869). Recently, this Court stressed that “ERISA preemption analysis ‘must be guided by respect for the separate spheres of governmental authority preserved in our fed- eralist system.’ If a state creates no prospect of conflict with a federal statute, there is no warrant for disabling it from attempting to address uniquely local social and economic problems.” Fort Halifax, 482 U.S. at 19 ‘cita- tions omitted!. In Fort Halifar, this Court saved from ERISA preemption a state statute, because it “neither establishe[d], nor require/d| an employer to maintain” an employee benefit plan. /d., 482 U.S. at 6. The “focus of {ERISA} is on the administrative integrity of benefit plans.” /d., 482 U.S. at 15. And, “|p!reemption ensures that the administrative practices of a benefit plan will be governed by only a single set of regulations.” Jd., 482 U.S. at 11. The court below held Section 220 preempted, even though New York’s highest court holds that an employer ean satisfy Section 220 without establishing, maintaining, or in any way involving itself or its employees with a fringe benefit plan. Section 220 is nothing more than a 9 York’s prevailing wage law does not attempt to regulate the administration of any employee benefit plan. Conse- quently, the New York prevailing wage law does not present any of the risks that ERISA preemption was in- tended to address, and under Morash and Fort Halifax should not be preempted. This conclusion is not altered by the fact that the New York law gives employers the options of meeting the Statutory requirement by providing “a combination of cash and benefits, or by an equivalent benefit plan” in addition to allowing cash payments directly to employees. Action Electrical, 485 N.Y.S.2d at 242. As stated, by Judge Pratt in his dissenting opinion below: The fact that employers may choose to comply with the law by providing a different benefit plan or a combination of benefits and cash rather than by sim- ply paying the additional costs as wages, does not render the statute preempted. 891 F.2d at 30 (Pratt, J. dissenting), citing Shaw v. Delta Air Lines, Inc., 263 U.S. 85 (1983). To hold otherwise would yield the truly absurd result that an otherwise valid requirement that a public works con- tractor pay certain monies directly to his employees would be held preempted, because the state law gave the contractors more options, instead of fewer. In Rehaldo v. Cuomo, 749 F.2d 133 (2d Cir. 1984), the Second Circuit held that a New York law regulat- ing hospital rates was not preempted under ERISA. In so holding, the Second Circuit ‘“‘analogized to State labor laws that govern working conditions and labor costs,” id. 749 F.2d at 138, to conclude that a state stat- ute is not preempted that “does not affect the structure, the administration, or the type of benefits provided by an ERISA plan... .” Jd., 749 F.2d at 139. Then, in AEtna Life Insurance Co. v. Borges, 869 F.2d 142, 145 (2d Cir. 1989), the Second Circuit reiterated the point: 11 CONCLUSION Due to the detrimental effect this decision will have on prevailing wage laws throughout the nation, and because there is no evidence that Congress ever intended to pre- empt the long-standing policy of New York and more than thirty other states to provide for fair bidding and a minimum level of total compensation on public works projects, the Building and Construction Trades Depart- ment urges this Court to review the decision below. Respectfully submitted, LAURENCE J. COHEN GERALD M. FEDER TERRY R. YELLIG DAVID R. LEVIN * SHERMAN, DUNN, COHEN, FEDER & ASSOCIATES LEIFER & YELLIG, P.C. Suite 600 Suite 291 1350 Connecticut Ave., N.W. 1125 15vh Street, N.W. Washington, D.C. 20036 Washington, D.C. 20005 (202) 955-8305 (202) 785-9300 Attorneys for the Building and Construction Trades Department, AFL-CIO Dated: May 10, 1990 * (Counsel of Record) --- Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385020_1357%3A4. Public record. Not legal advice.