Building Trades Confident of Victory on Appeal in Lawsuit To Order City of Vista to Comply with State Prevailing Wage Law

December 10, 2007 - Last week, the State Building & Construction Trades Council (SBCTC) took an important step forward in its lawsuit to require California charter cities to pay prevailing wages on city public works construction projects. In July, the SBCTC filed a lawsuit against the City of Vista in San Diego County to establish that California charter cities must comply with the state's prevailing wage law.

The goal of the lawsuit is to advance the charter city/prevailing wage issue to the California Supreme Court. A favorable ruling on SBCTC's lawsuit in the state's top court would reverse an outdated 1932 California Supreme Court decision, which allowed charter cities, if they choose, to sidestep the prevailing wage law.

Even though the San Diego County Superior Court ruled last week that it was required to follow precedent and rule against the SBCTC's petition to require Vista to pay prevailing wages, the court stated in its decision that if it were not bound by an outdated decision from a higher court, it would have ruled in favor of the SBCTC.

The Superior Court's decision agreed with the SBCTC's core argument that the prevailing wage law is a matter of statewide concern and, therefore, that charter cities should be required to follow the law. This decision sets the SBCTC's case up for appeal.

"We understand that the Superior Court is bound by the decisions of higher courts, even though they are outdated, so today's ruling was not unexpected." said attorney Scott A. Kronland of Altshuler Berzon LLP, who filed the case for the SBCTC. "We will appeal this case, and we are confident we will ultimately prevail. The Superior Court agreed we are right on the merits." Kronland said. State prevailing wage law requires public officials to include in contracts for public works a requirement that contractors must pay construction workers at least the wages and benefit levels that prevail in each geographic area, and a requirement that contractors must hire apprentices.

The SBCTC filed the lawsuit after the Vista City Council ordered a special city election on June 5, 2007, that asked Vista voters to adopt a city charter in an effort to bypass state prevailing wage law. Fewer than 21 percent of eligible voters cast ballots, and the charter was adopted.

A City Council report made clear that the main motivation for adopting the charter was the desire of some Vista officials to avoid the state prevailing wage law as the city prepares for a $100 million construction program. On June 26, the City Council followed up by approving an ordinance declaring that the prevailing wage law no longer will be applied to Vista city projects.

Kronland said charter cities that ignore the prevailing wage law rely upon a 1932 California Supreme Court decision, City of Pasadena v. Charleville, that ruled that the California Legislature did not have the constitutional authority to apply an earlier version of the prevailing wage law to charter cities. But there have been significant changes in the California Constitution, the prevailing wage law, and the mobility of the workforce since 1932, so the reasoning of the Charleville case is outdated and should be rejected, Kronland said.

The SBCTC lawsuit will bring back to the courts for an answer the important question that the California Supreme Court expressly left open in a 2004 case � City of Long Beach v. Department of Industrial Relations.

A State Court of Appeal had ruled in the Long Beach case that today's prevailing wage law does apply to charter cities. The California Supreme Court granted review to consider the issue but wound up deciding the case on other grounds.

The Supreme Court stated in its 2004 Long Beach decision that it would "leave open for consideration at another time" the issue whether the prevailing wage law applies to charter cities. The State Building Trades lawsuit will bring this issue back before the courts.

There are 109 charter cities in California, and many of them choose to pay prevailing wages on their city construction projects.