Com. v. Glenn O Hawbaker, Inc.

CourtSuperior Court of Pennsylvania
DecidedMarch 5, 2025
Docket188 MDA 2024
StatusUnpublished

This text of Com. v. Glenn O Hawbaker, Inc. (Com. v. Glenn O Hawbaker, Inc.) is published on Counsel Stack Legal Research, covering Superior Court of Pennsylvania primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Com. v. Glenn O Hawbaker, Inc., (Pa. Ct. App. 2025).

Opinion

J-A23010-24

NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT O.P. 65.37

COMMONWEALTH OF PENNSYLVANIA : IN THE SUPERIOR COURT OF : PENNSYLVANIA : v. : : : GLENN O. HAWBAKER, INC. : : Appellant : No. 188 MDA 2024

Appeal from the Order Entered January 31, 2024 In the Court of Common Pleas of Centre County Criminal Division at No(s): CP-14-CR-0000461-2021

BEFORE: BOWES, J., OLSON, J., and STABILE, J.

MEMORANDUM BY BOWES, J.: FILED: MARCH 5, 2025

Glenn O. Hawbaker, Inc. (“GOH”) appeals from the order denying its

motion to enforce plea agreement. We affirm.

The trial court ably summarized the background of this case as follows:

GOH is a family-owned business headquartered in State College, Pennsylvania. Founded in 1952 by the Hawbaker family, GOH is primarily a highway and bridge construction contractor. It has performed numerous construction projects for both private and public customers. Throughout Pennsylvania, GOH has completed construction projects for the Pennsylvania Department of Transportation (“PennDOT”), counties[,] and municipalities. GOH operates several facilities in Pennsylvania and neighboring states.

At any given time, GOH employs up to approximately 1,200 employees, including roughly 100 employees who work at the company’s corporate headquarters in State College and hundreds of employees who work at construction sites throughout Pennsylvania on public and private projects. A large percentage of the company’s construction projects are government-funded public works projects requiring compliance with state and/or federal prevailing wage laws. J-A23010-24

On April 8, 2021, the Office of Attorney General (“OAG”) filed a criminal complaint against GOH, charging it with four counts of theft by failure to make required disposition of funds received (first degree felony) under 18 Pa.C.S. § 3927(a). The charges stemmed from alleged misappropriation of funds that GOH employees earned while working on public works projects. All of the conduct for which GOH was charged occurred between September 1, 2015, and December 31, 2018 (the “charged period”).

Construction contractors who work on public works projects are required to comply with the terms of the Pennsylvania Prevailing Wage Act (“PWA”), [and the federal] Davis-Bacon Act (“DBA”) and [federal] Davis-Bacon Related Acts (“DBRA”), depending on whether federal and/or state funds are being used for the projects.

Under the PWA, DBA[,] and DBRA, workers on public works projects are to be paid in accordance with wage determinations issued by either the Department of Labor and Industry (“DLI”) or the United States Department of Labor (“USDOL”). The wage determinations specify what hourly wage is deemed prevailing for a given trade in the area. The wage consists of two components - an hourly wage to be paid to each worker and a fringe benefit allotment which permits employers to satisfy a portion of their total wage obligations by providing the workers with bona fide employment benefits.

There are limitations on the costs that a contractor may assess to prevailing wage fringe benefits. For instance, contractors may not use prevailing wage fringe benefit funds to cover internal administrative fees. Further, the amount of fringe benefit money contributed into a bona fide fringe benefit program must be reasonably anticipated to cover the actual cost of the benefit. Prevailing wage fringe benefit money cannot be used to fund benefits for anyone other than the individual worker who earned the money. Contractors bidding on public works projects are notified in the request for proposal that the project is subject to prevailing wage law requirements. When a contractor is selected to complete a public works project subject to the PWA, DBA, or DBRA, the contractor agrees that it will pay its workers in accordance with the prevailing wage laws.

-2- J-A23010-24

The criminal complaint against GOH alleged that during the charged period, GOH stole fringe benefit funds from employees who worked on prevailing wage projects. Specifically, the criminal complaint alleged that GOH used the money intended to fund prevailing wage workers’ retirement accounts and health and welfare benefits to instead fund retirement accounts and health and welfare benefits for all employees, executives, and owners. GOH allegedly artificially inflated its records of benefit spending for prevailing wage workers while reporting to government agencies that it was providing benefits well in excess of what was required by law.

A grand jury investigation preceded the filing of the criminal charges against GOH. After learning of the grand jury investigation in June 2018, GOH retained consultants to review its prevailing wage practice and changed its prevailing wage fringe credit practices effective in 2019. GOH believed the changes it made to the fringe credit methodology complied with the OAG’s interpretation of the PWA and the DBA. The [affidavit of probable cause attached to the] criminal complaint indicates that OAG believed that despite the changes, GOH continued to underfund prevailing wage fringe benefits; however, since GOH made efforts to correct its practices starting in 2019, no criminal conduct was alleged for that year.

Trial Court Opinion, 4/8/24, at 1-4 (cleaned up).

Due to the criminal charges, the Pennsylvania Department of

Transportation (“PennDOT”) issued a notice “suspending [GOH] from

contracting with, bidding on, or participating in the award of contracts for

Commonwealth-supervised or Commonwealth-funded highway construction

work.” Glenn O. Hawbaker, Inc. v. Dep’t of Transp., 304 A.3d 1067,

1072 (Pa. 2023). In particular, PennDOT acted pursuant to regulations that

allowed it to temporarily or permanently suspend or debar contractors for

enumerated reasons including commission of a criminal offense and violations

of state or federal prevailing wage standards. Id. In response, GOH filed in

-3- J-A23010-24

the Commonwealth Court a complaint in equity against PennDOT asserting

due process violations and contending that DLI had “exclusive jurisdiction

over investigations and debarment actions involving PWA violations pursuant

to a different and more fulsome process.”1 Id. at 1073. GOH also filed a

motion for a preliminary injunction, which our sister Court granted on June

____________________________________________

1 As our High Court explained:

[T]he PWA itself is administered and enforced by [DLI]. The PWA . . . requires public bodies to notify the Secretary of [DLI] when a contractor fails to pay prevailing wages in connection with public work performed for the public body. Whenever the Secretary of [DLI] receives such a notification, or whenever any workman employed upon public work files a timely protest objecting that he has been paid less than prevailing wages as required by the PWA . . ., the Secretary of [DLI] is to conduct an investigation that entails an appropriate hearing upon due notice to interested parties. Additionally, the Secretary of [DLI] is to determine whether or not there has been a failure to pay the prevailing wages and whether such failure was intentional or otherwise.

If the Secretary of [DLI] determines after notice and a hearing that a contractor has unintentionally failed to pay prevailing wages, the Secretary of [DLI] shall afford the contractor a reasonable opportunity to adjust the matter by, inter alia, making the required payments.

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Bluebook (online)
Com. v. Glenn O Hawbaker, Inc., Counsel Stack Legal Research, https://law.counselstack.com/opinion/com-v-glenn-o-hawbaker-inc-pasuperct-2025.