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LEVINE, J.:
The facts of this controversy are essentially
undisputed. In l992, petitioner Cayuga-Onondaga Counties Board of Cooperative
Educational Services (BOCES) entered into an agreement with one of its
member school districts, the Auburn City School District, to provide the
labor for a lighting improvement project consisting of changing the ballasts
in the fluorescent lighting to more energy efficient ballasts at all school
buildings throughout the district. BOCES hired 41 full-time employees
of the Auburn school district to work after hours in performing the installation.
BOCES applied to the Cayuga County Civil Service Commission and obtained
a civil service classification of these workers as temporary, seasonal
laborers of BOCES. Their BOCES pay rates were the same as they received
from the Auburn school district, but they were not compensated at overtime
rates, which they would have received had they performed the work directly
for the school district. The Auburn City School District reimbursed
BOCES for its payments to the workers on the ballast replacement project.
After receiving informal complaints from workers
in the ballast replacement project, an official of the area's electrical
workers union (which did not represent the workers involved)
filed a formal complaint with the State Department of Labor averring
that BOCES was required to pay the prevailing wage rate for electricians
to its employees on the project. Following a department field investigation,
the Commissioner of Labor issued a Notice of Hearing to BOCES in March
l994 on allegations that BOCES failed to pay the prevailing wages and supplements
to 41 of its employees on the Auburn school district lighting project,
in violation of Labor Law 220.
At the conclusion of the hearing, the hearing
officer issued a report and recommendation. The hearing officer found
that the arrangement between the Auburn City School District and BOCES
was made to avoid the school district's liability for payment of overtime
wages to its employees working on the project; that BOCES was acting in
the capacity of a general contractor for the school district on the project;
and that the type of work performed by the 41 BOCES employees was generally
performed by
electricians. The hearing officer determined that the ballast
replacements constituted a public work project and that BOCES violated
Labor Law 220 in failing to pay its workers prevailing electricians'
wage rates. She further ruled that BOCES was not exempt from the
requirements of Labor Law 220 by reason of its employees' civil service
classifications as temporary seasonal laborers.
The Commissioner of Labor adopted the hearing
officer's report in all respects and ordered a further hearing for the
purpose of determining the amount of underpayment, any civil
penalty and willfulness. The Appellate Division confirmed
the determination and dismissed the petition (__AD2d___). We granted
BOCES permission to appeal.
BOCES' primary grounds for reversal are that
the Commissioner of Labor lacked jurisdiction to make the determination
herein because a timely notice of claim against BOCES in compliance with
Education Law 3813(1) was never filed by the Department of Labor and
because the Commissioner failed to commence formal proceedings against
it through the service of Notice of Hearing until after the one year statute
of limitations of Education Law 3813(2-b) had expired. We find
these arguments unpersuasive.
In determining the applicability of the three-month
notice of claim requirement of Education Law 3813(1) to statutory or
nonjudicial proceedings involving school districts, school boards and boards
of cooperative educational services, as well as parallel notice of claim
requirements when such proceedings involve other municipal units of government,
our Court has distinguished between proceedings "which on the one hand
seek only enforcement of private rights and duties and those on the other
in which it is sought to vindicate a public interest; the provisions of
subdivision 1 of section 3813 are applicable as to the former but not as
to the latter" (Union Free School Dist. No. 6 of Towns of Islip & Smithtown
v New York State Div. of Human Rights Appeal Bd., 35 NY2d 371, 380, rearg
denied 36 NY2d 807).
Thus, in Union Free School District No. 6
(supra), the issue was the validity of a provision of a collective bargaining
agreement mandating inferior treatment of pregnancy and child
birth absences from absences based on other physical or medical disabilities,
challenged as illegal sex discrimination. We held that although the
"proceeding was triggered by the complaint of this one teacher", and the
monetary relief granted would benefit the complainant and teachers similarly
situated, those "advantages * * * flow[ed] as an appropriate and intended
consequence of the vindication by the division, acting on behalf of the
public, of the public's interest in the elimination of discrimination based
upon sex -- a public interest duly declared by legislative enactment" (35
NY2d, at 380).
Contrastingly, in Mills v County of Monroe
(59 NY2d 307, cert denied 464 US l0l8) a plenary civil damage action authorized
under state and federal anti-discrimination statutes seeking only personal
redress for "allegations of actionable conduct on the part of the county
refer[able] only to conduct that relates to [the plaintiff]," the filing
of a notice of claim, as generally
required under County Law 52(1), was held to be a condition precedent
to the suit.
The instant proceeding initiated by the Commissioner
of Labor to enforce prevailing wage payment requirements for public work
projects under section 220 of article 8 of the Labor Law falls well within
the vindication of a public interest category, for which statutory notice
of claim requirements are inapposite.
First, the mandate that laborers, workers
and mechanics employed in public work projects be paid the wages "prevailing"
in their trade or occupation in the locality is not merely of
statutory derivation but has its underlying basis in article I, 17
of the State Constitution. The prevailing wage requirement was first
enacted in legislative form in 1894 (L 1894, ch 622;
see, Report of Temp St Commn on Constitutional Convention of l967,
Housing, Labor and Natural Resources, at 80). In response to this
Court's decision in People v Coler (l66 NY l), which partly invalidated
the l894 law, the State Constitution was amended in l905 to authorize prevailing
wage legislation (Report of Temp St Commn on Constitutional Convention
of 1967, supra, at 80).
The prevailing wage/public work requirement
was retained as a constitutional imperative in its present form in the
l938 State Constitution. Constitutional Convention Delegate (and
State Senator) Dunnigan, a proposer of its retention, argued that inclusion
of the prevailing wage mandate in the Constitution was necessary because
"it has become a fixed principle in our society, which should be embodied
in our organic law so as to insure its continuance [and] * * * because
it should assume constitutional proportions so that this policy of state
may be manifest to labor and industry as a principle of state" (Revised
Record, l938 Constitutional Convention, at 2204).
Labor Law 220, in content, structure and
purpose confirms that a proceeding such as this, brought by the Commissioner
of Labor to enforce the statutory and constitutional mandate, has as its
overriding goal the vindication of a public interest rather than just to
provide a forum in a particular case for the adjudication of a claimed
personal statutory right, as in Mills v County of Monroe (supra) (see also,
Board of Educ. of Union Free School Dist. No. 2 v New York State Div. of
Human Rights [Arluck], 44 NY2d 902, 904, rearg denied 45 NY2d 838; Matter
of Board of Educ. of Enlarged Ogdensburg City School Dist. [Wagner Corp.],
37 NY2d 283). Section 220 has been characterized as "an attempt by
the state to hold its territorial subdivisions to a standard of social
justice in their dealings with laborers, workmen, and mechanics" (Austin
v City of New York, 258 NY 113, 117 [Cardozo, C.J.] [emphasis supplied]).
The statutory procedures, powers and duties
of the Commissioner and available remedies and sanctions under section
220 and the other provisions of article 8 of the Labor Law all
have the earmark of a powerful administrative mechanism for the enforcement
of a strong public policy, over which a private complainant has no control.
Except for New York City's public work projects, the Commissioner of Labor
is required to ascertain prevailing wage rates on all public work performed
in the State, irrespective of whether affected workers have complained
of a violation of the statute (Labor Law 220[3]). The Commissioner
is not limited to responding to a formal, verified complaint of an "interested
person" employed in the performance of a public work, but "may [as in the
instant case] on his [or her] own initiative cause a compliance investigation
to be made" (Labor Law 220[7] [emphasis supplied]). The Commissioner
determines whether to hold a formal statutory hearing to adjudicate any
violation preliminarily disclosed through the compliance investigation
(Labor Law 220[8]). The Commissioner must investigate "the willfulness
of the alleged violation" (Labor Law 220[7-a]) -- obviously an issue
entirely independent of the resolution of the claims of individual workers
to additional remuneration up to the appropriate prevailing wage rate.
A willful violation carries criminal sanctions (Labor Law 220[3]), and
a second administrative adjudication of a willful violation within a six
year period renders the violator ineligible for any award of a public work
contract for five years (Labor Law 220-b[3][b]). Moreover, even
in the absence of a willful violation, upon a determination of a prevailing
wage rate violation, the Commissioner is authorized not only to grant remedial
relief to affected workers, but may also impose a civil penalty of up to
25% of the total additional wages and supplements due, payable to the State
(Labor Law 220[8]).
All of the foregoing potent tools available
to the Commissioner of Labor under section 220 and other provisions of
Labor Law article 8 to enforce the public policy of the State, for the
payment of prevailing wages on all public work projects, may be exercised
independently of the position or even existence of a private complainant.
Thus, proceedings under section 220 are the antithesis of proceedings for
the enforcement of private rights, statutory or otherwise. Subjecting
the Commissioner's jurisdiction under section 220 and companion sections
of Labor Law article 8 to the three month notice of claim requirements
of Education Law 3813(1) would drastically weaken the Commissioner's
ability to enforce the strong prevailing wage policy of the State against
school districts. Thus, prevailing wage enforcement proceedings under
Labor Law 220 constitute instances where the public "interests in their
resolution on the merits override [a school district's or BOCES'] interest
in receiving timely notice before commencement of an action" (Mills v County
of Monroe, supra, 59 NY2d, at 3ll), and the Commissioner's failure to file
a notice of claim under Education Law 3813(1) is not preclusive.
Likewise, in enforcement proceedings under
Labor Law 220
or other provisions of article 8 of that statute, the Commissioner
of Labor is not bound by the one year statute of limitations of Education
Law 3813(2-b). All of the public policy considerations for finding
that Education Law 3813's notice of claim requirement is inapplicable
to these proceedings are equally valid with respect to the statute of limitations
set
forth in that section. We have already held that a procedural
bar to the suit of a private individual may not preclude a State administrative
agency from enforcement proceedings "vindicat[ing] a public right to protection
against conduct which the Legislature has found is inimical to the welfare
of the People of the State" (New York State Labor Relations Board v Holland
Laundry, 294 NY 480, 495 [litigation between employer and employees not
a res judicata bar against State Labor Relations Board action covering
the same subject matter], rearg denied 295 NY 568).
Moreover, applying either the notice of claim
or statute of limitations provisions of Education Law 3813 to prevailing
wage law enforcement proceedings would conflict with (1) the three year
period given the Commissioner of Labor within which to initiate enforcement
proceedings under Labor Law 220-b(2) (for withholding amounts due the
contractor or subcontractor); (2) the authority of the Commissioner of
Labor to docket an administrative order determining liability for failure
to pay prevailing wages as a money judgment, without commencing a plenary
action (Labor Law 220[8], 220-b[2][f]); and (3) various periods of limitation
contained in Labor Law article 8 for the commencement of civil actions
against violators to recover the deficiencies in payment of prevailing
wages, all of which are measured from the date of the final administrative
determination of a prevailing wage violation by the Commissioner of Labor
(such as challenged here) after the completion of judicial review, if any
(see, Labor Law 220[8], 220-b[3][a]); Bucci v Village of Port Chester,
22 NY2d l95, 203-204 [the municipal notice of claims statutes have no "relevancy
or application to actions brought pursuant to subdivision 8 of section
220"]). Since notice of claim requirements have no relevance to article
8 civil actions (Bucci v Village of Port Chester, supra), a fortiori they
have no relevance to the Commissioner's enforcement proceedings (as in
the instant case) upon which the civil actions are based.
In equating this enforcement action with the
private damages action at issue in Mills, the dissent ignores the breadth
of the statutory enforcement tools available to the commissioner, the independent
limitations periods for administrative enforcement actions contained in
the Labor Law, the limitations periods for statutory civil actions which
are dependent on the administrative determination, and the controlling
precedential effect of Bucci (supra) here, that since notice of claims
requirements are not applicable to these Labor Law civil actions they cannot,
a fortiori, be applicable to the administrative enforcement proceedings
upon which those actions depend.
We also reject BOCES' alternative argument
for reversal, that because the 41 Auburn school district employees hired
by BOCES to perform the ballast replacements were classified by the Cayuga
County Civil Service Commission as temporary seasonal employees of BOCES,
they fall within the common law exemption from the statutory prevailing
wage rate mandate for classified and graded public employees (see, Corrigan
v Joseph, 304 NY 172, rearg denied 304 NY 759, cert denied 345 US 924;
Matter of Buffalo Bldg. Trades Council of the Buffalo Board of Educ. Employees
v Board of Educ., of City of Buffalo, 36 NY2d 782; Wood v City of New York,
274 NY 155). Because the 41 workers were ungraded employees of BOCES,
awarding them increases in remuneration to the level of prevailing wage
rates would not effectively grant them a promotion to above-grade salary
levels. Hence, no violation of civil service law principles of merit and
fitness promotions are implicated by application of Labor Law 220 here,
and the exemption does not apply (see, Gaston v Taylor, 274 NY 359, 363;
cf., Corrigan v Joseph, supra).
All other issues raised here were unpreserved
and have not been considered.
Accordingly, the Appellate Division's order
should be affirmed, with costs.
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CIPARICK, J. (dissenting):
Because we conclude that a notice of claim
should have been served on petitioner pursuant to Education Law 3813(1),
we would reverse the order of the Appellate Division. Therefore,
we respectfully dissent.
Respondent, Commissioner of Labor, initiated
the underlying proceeding pursuant to Labor Law 220(7) to determine whether
petitioner, Cayuga-Onondaga Counties Board of Cooperative Educational Services
(BOCES), paid 41 employees of the Auburn City School District and Moravia
Central School District (collectively, Auburn) prevailing wages for the
ballast replacement work performed in school buildings in those districts.
The Hearing Officer designated by the Commissioner
found, as a matter of fact, that the "[e]mployees hired by [petitioner]
received the civil service classification of laborer [and a]ll of the 41
employees were appointed by the Cayuga County Civil Service Commission
as seasonal laborers employed by BOCES." The Hearing Officer ruled,
as a matter of law, that since BOCES was acting as a contractor by performing
work for a legal entity other than itself, the "State Constitution (Art
1, 17) and Labor Law 220 requires that workers engaged on such public
work receive prevailing wages." Thus, the Hearing Officer concluded
that Auburn "used BOCES to avoid paying overtime wages and benefits to
its employees" and that BOCES, by hiring the Auburn employees as seasonal
workers, did not pay the prevailing rate of wages. The Hearing Officer
directed BOCES to pay the prevailing wage rates or provide supplements
in accordance with Labor Law 220(8). Respondent-Commissioner adopted
and confirmed the Hearing Officer's factual findings and conclusions of
law, and ordered a further hearing to determine (1) the amount of underpayments,
(2) whether to impose a civil penalty and (3) the wilfulness of the Labor
Law violations. The Appellate Division confirmed respondent's determination
(see, M/O Cayuga-Onondaga Cts Bd of Coop Educ Servs v Sweeney, ___ AD2d
___).
We do not quarrel with the Majority's analysis
that the principles embodied in Labor Law 220, derived from article I,
17 of our State Constitution, reflect the State's policy and
strong public interest that laborers, workers and mechanics employed
in public works projects be paid "prevailing wages." However, we disagree
that an enforcement action brought pursuant to the administrative procedures
outlined in Labor Law 220(7) and (8) excuses the Education Law's express
statutory notice of claim requirement which enjoins the prosecution or
maintenance of any "action or special proceeding, for any cause whatever
. . . relating to . . . the rights or interests of any district or any
such school . . . against any . . . board of cooperative educational services
. . . unless it shall appear by and as an allegation in the complaint or
necessary moving papers that a written verified claim upon which such action
or special proceeding is founded was presented to the governing body of
said district or school within three months after the accrual of such claim"
(Education Law 3813[1] [emphasis added]; see, Mills v County of Monroe,
59 NY2d 307, 309, cert denied 464 US 1018).
In Mills, supra, the Court determined that
plaintiff's failure to comply with the pertinent notice of claim requirement
was fatal to her employment discrimination suit. While recognizing
the narrow, judicially-crafted exception to notice requirements in actions
brought to vindicate an important public interest, generally applied in
the context of civil rights violations, the Mills court drew an important,
distinguishing line. There, plaintiff alleged that defendant, County
of Monroe, impermissibly terminated her employment based on race and national
origin in contravention of Executive Law 296 and 42 USC 1981, statutes
which provide administrative remedies for individuals aggrieved by violations
of both the State and Federal public policy outlawing discriminatory conduct.
Faced with a motion for summary judgment for
failure to file a notice of claim pursuant to County Law 52, plaintiff
Mills argued that the notice requirement was inconsistent with the remedial
and deterrent policies of the civil rights laws (see, id., at 309).
Rejecting plaintiff's argument, the Court determined that the State's notice
requirements were not antithetical to the policy underlying the civil rights
laws since notice provisions themselves serve an important State interest
-- protecting municipalities and public corporations against fraudulent
and stale claims (see, id., at 310-311) -- and neither the public policy
barring discriminatory conduct nor that intended to provide governmental
entities with timely notice of a claim preempted or outweighed the other.
The Court concluded that even though plaintiff
was seeking to vindicate the right to be free of discriminatory employment
practices -- an important public interest embodied in both
Federal and State statute -- and she alleged that the County engaged
generally in unlawful discriminatory practices, "her action seeks relief
only for her termination, which she alleges
resulted from her opposition to the County's discriminatory practices
and her race and national origin. The relief she seeks is money damages
for her loss of wages and damage to her
reputation. Inasmuch as the disposition of plaintiff's claim
was not intended to nor could it directly affect or vindicate the rights
of others, her action is properly characterized as one
seeking the enforcement of private rights" (id., at 312 [emphasis added];
see also, 423 South Salina St, Inc v City of Syracuse, 68 NY2d 474, 493,
cert denied 481 US 1008; Board of Educ of Union Free School Dist No 2,
East Williston, Town of North Hempstead v New York State Div of Human Rights,
44 NY2d 902, 904, rearg denied 45 NY2d 838; M/O Saranac Lake Central School
Dist v New York State Div Of Human Rights, ___ AD2d ___, 640 NYS2d 303,
304; M/O Board of Educ of the Union-Endicott Cent School Dist v PERB, 197
AD2d 276, 278-279, lv to appeal denied 84 NY2d 803; M/O Harder v Board
of Educ, Binghamton City School Dist, 188 AD2d 783, 784; accord, Ruocco
v Doyle, 38 AD2d 132, 134; cf, New York
State Labor Rel Bd v Holland Laundry, 294 NY 480, 495-496).
This reasoning applies with equal force to
the instant appeal, which, distilled to its essence, is an action to recover
lost wages. While any action brought to enforce a right protected
by statute can be said to serve the public interest in some manner, Mills
establishes that an action brought to vindicate a right -- even a statutorily
protected right generally categorized as one in the public interest --
does not excuse an applicable notice requirement when the remedy sought
inures strictly to the personal benefit of the aggrieved claimants.
The Majority's heavy reliance on Union Free
School Dist No 6 of Towns of Islip & Smithtown v New York State Human
Rights Appeal Bd (35 NY2d 371, rearg denied 36 NY2d 807) -- decided nearly
10 years before Mills -- to support its proposition that the underlying
proceeding was one to vindicate a public right is misplaced. In that
case, unlike Mills or the instant case, plaintiff's action truly vindicated
the important right to equal treatment in the workplace, which the Court
concluded would inure to the benefit of a similarly situated class, by
establishing that pregnant women possess rights equivalent to individuals
who avail themselves of leaves of absences for other disabilities. That
a statutory mechanism provides the method for aggrieved claimants to vindicate
their personal economic interest in a recognized right does not transmute
an action for alleged underpayment of wages to 41 employees into one to
vindicate a public right, a point central to our disagreement with the
Majority's holding.
Tracing the genesis of Labor Law 220(7)
and (8), it is evident that these enforcement provisions were adopted for
the purpose of providing workers on the job with an effective
administrative remedy, not "to provide a method of enforcing the prevailing
rate of wages statute generally" (M/O Yerry v Goodsell, 4 AD2d 395, 398,
aff'd 4 NY2d 999), which is what the Majority holds. The predecessor
sections to Labor Law 220 (7) were penal in nature dictating criminal
prosecution of violators but providing no remedy for the exploited worker
to recover lost wages (see, Labor Law of 1909, 3, as amended by L 1916,
ch 152; see also, M/O Gaston v Taylor, 274 NY 359, 361-362; M/O Yerry v
Goodsell, supra, 4 AD2d, at 398). The 1927 amendment to section 220
created the administrative procedure essentially in place today by which
workers who claim to be aggrieved because they performed public work at
a rate lower than the prevailing wage have the right to file a verified
complaint with the Commissioner of Labor for an administrative determination
of the prevailing wage rate (see, Labor Law 220(7) [originally added
by L 1927, ch 563]). Contrary to the Majority's holding, it does
not follow from this that every proceeding instituted to adjudicate a prevailing
wage claim constitutes an action to vindicate a public interest which justifies
discarding the statutory notice of claim requirement governing actions
or special proceedings commenced against certain public corporations, such
as a BOCES or a Board of Education (accord, Mills, 59 NY2d, at 312, supra).
While it has been said that the complaint procedure set forth in Labor
Law
220(7) "was designed solely for the purpose of enabling the employees
on the job to obtain effective relief" (M/O Yerry v Goodsell, supra, 4
AD2d, at 399), to construe Labor Law 220(7) as the Majority does effectively
abolishes the prerequisite that a notice of claim be filed in an action
for lost wages simply because there is a statutory scheme that invests
a public official with investigatory and enforcement powers regarding a
matter of public interest.
Moreover, the fact that Education Law 3813(1)
specifically requires a notice of claim in contract actions places it outside
the general rule restricting such requirement to claims against a municipality
or public corporation to those sounding in tort (see generally, General
Municipal Law 50(e) and (i); NYC Administrative Code 7-201[a]; see
also, H&J Floor Covering, Inc v Board of Educ of City of New York,
66 AD2d 588). The Majority does not advance -- nor is there -- any
valid or rational justification to exempt an action under Labor Law 220
from this requirement or from the one year statute of limitations (cf.,
Board of Educ of the Katonah-Lewisboro School Dist v Board of Educ of the
Carmel Cent School Dist, 174 AD2d 704, 705 [public interest exception does
not permit commencement of actions against school district after expiration
of one year statute of limitations provided in Education Law 3818(2-b)])
given that the ultimate relief sought by claimants not only imposes a financial
liability on BOCES, a component part of the school district, but where
the financial award does not inure to the benefit of the members of a similarly
situated class. The inclusion of a notice of claim requirement in
Education Law 3813 for contract actions is strong evidence of the legislative
intent that a notice of claim is a condition precedent to the maintenance
of an action by or on behalf of workers to collect purported underpayments
of wages, regardless whether the "action" is brought in a court or an administrative
tribunal. Certainly, if the Legislature intended to exempt Labor
Law 220 from these statutory prerequisites it would have done so in explicit
terms. Thus, we conclude that the Commissioner's failure to file a notice
of claim mandates that the petition be granted. The Majority's
comment that we have ignored the breadth of the enforcement tools available
to the Commissioner by suggesting that the limitations periods set forth
in Education Law 3813(2-b), and the notice of claim requirement of Education
Law 3813(1), apply to actions seeking to recover underpayments overlooks
our point: it is the gravamen of the claim against BOCES -- or a
Board of Education -- that controls the applicability of the statutory
prerequisite of a notice of claim or limitations period, not the procedural
posture in which the claim was initially pursued. The bald statement
in Bucci v Village of Port Chester (22 NY2d 195, 203-204) that the notice
of claim requirement has no relevancy to actions brought under Labor Law
220(8) contravenes an express statutory requirement by creating a judicially-crafted
exception without sufficient justification.
Accordingly, the order of the Appellate Division
should be reversed.
* * * * * * * * * * * * * * * * *
Order affirmed, with costs. Opinion by Judge Levine. Judges
Simons, Titone and Smith concur. Judge Ciparick dissents and votes
to reverse in an opinion in which Chief Judge Kaye and Judge Bellacosa
concur.
Decided December 20, 1996