Counties of Blue Earth v. Minnesota Department of Labor & Industry

489 N.W.2d 265, 1 Wage & Hour Cas.2d (BNA) 422, 1992 Minn. App. LEXIS 918, 1992 WL 208572
CourtCourt of Appeals of Minnesota
DecidedSeptember 1, 1992
DocketC0-92-635
StatusPublished
Cited by11 cases

This text of 489 N.W.2d 265 (Counties of Blue Earth v. Minnesota Department of Labor & Industry) is published on Counsel Stack Legal Research, covering Court of Appeals of Minnesota primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Counties of Blue Earth v. Minnesota Department of Labor & Industry, 489 N.W.2d 265, 1 Wage & Hour Cas.2d (BNA) 422, 1992 Minn. App. LEXIS 918, 1992 WL 208572 (Mich. Ct. App. 1992).

Opinion

OPINION

FORSBERG, Judge.

The Minnesota Department of Labor and Industry and the Minnesota Department of Transportation, and Commissioners John Lennes and James Dehn respectively, appeal from the district court’s grant of a temporary injunction in favor of respondent Counties. We reverse.

*267 FACTS

In September 1991, the Commissioner of the Department of Labor and Industry certified a prevailing wage rate as required by the Prevailing Wage Statute for respondent Counties. Respondents disputed the rate setting process and resulting wage rates, and were granted a temporary injunction by the district court in April 1992.

After receiving respondents’ complaints, and prior to the district court’s injunction, the Commissioner ordered a new prevailing wage survey. In ordering the temporary injunction, the district court stated “the Commissioner has tacitly admitted that [the process of determining the prevailing wage rate] was flawed by ordering completely new data to be developed to correct the situation.”

Following entry of the temporary injunction, the Commissioner ordered that, pursuant to the district court’s order, respondents did not have to follow the prevailing wage rate. However, this court has issued a stay of the temporary injunction pending resolution of this appeal.

ISSUE

1. Did respondents adequately exhaust their administrative remedies before seeking to enjoin enforcement of the prevailing wage rate?

2. Did the district court lack jurisdiction to hear an appeal from a decision of an administrative agency?

ANALYSIS

1. Appellants argue the Prevailing Wage Statute expressly provides an aggrieved party with an administrative remedy which respondents failed to pursue. Further, because respondents failed to exhaust that administrative remedy, they are not entitled to judicial relief. Respondents counter that pursuing the administrative remedy would have been futile due to their time constraints, and that the administrative remedy in the statute is not exclusive.

The Prevailing Wage Statute provides:

It is in the public interest that public buildings and other public works be constructed and maintained by the best means and highest quality of labor reasonably available and that persons working on public works be compensated according to the real value of the services they perform. It is therefore the policy of this state that wages of laborers, workers, and mechanics on projects financed in whole or part by state funds should be comparable to wages paid for similar work in the community as a whole.

Minn.Stat. § 177.41 (1990). To this end, the Commissioner is required, before the state asks for bids, to ascertain the prevailing hours and wages for all trades and occupations required on any project. Minn.Stat. § 177.44, subd. 4 (1990). The prevailing wage rate “means the hourly basic rate of pay * * * and any other economic benefit paid to the largest number of workers engaged in the same class of labor within the area.” Minn.Stat. § 177.42, subd. 6.

The Prevailing Wage Statute provides an administrative process by which an aggrieved party may first petition for reconsideration of a final determination of the Commissioner and then petition for a contested case hearing. Minn.Stat. § 177.44, subd. 4. The department rules also provide specifically for this type of administrative review. Minn.R. 5200.1090 (1991). Respondents did not follow this grievance procedure. Instead, they petitioned the district court for relief five months after the Commissioner had certified the prevailing wage rates.

The district court claimed jurisdiction over the matter because

[administrative remedies need not be pursued if it would be futile to do so. McShane v. City of Faribault, 292 N.W.2d 253 (Minn.1980). Because the rates that are certified remain the effective rates until the new figures are compiled by the Commissioner, there appears to be no legal remedy to prevent the harm wrought by the distortion in the existing certified rate.

However, as we state below, there is no indication that the administrative remedy would have been futile in this case. The *268 district court’s concern that the certified rates remain effective until new figures are compiled would not have been a concern had respondents taken action within 30 days of the Commissioner’s September 1991 wage rate certification. It was the failure to take such action that delayed the process and caused it to interfere with the letting of bids on summer projects.

Respondents correctly note there is a 30-day time limit on filing a petition for reconsideration. Minn.R. 5200.1090, subpt. 1 (an aggrieved person may file a petition for reconsideration of the wage rate within 30 days of its certification.) They also may be correct in their assertion that it would have taken them much longer than 30 days to conduct their own survey and produce the supporting data required by the rule. However, it is not necessary to submit the required supporting data within the 30-day time limit. As long as a petition of some kind is submitted within 30 days, it is timely. The Commissioner presented ample, credible evidence that it will allow a petitioner additional time to provide data in support of a claim. Given the Commissioner’s acceptance of incomplete petitions, respondents could have filed a timely petition for reconsideration before conducting their own survey. There was no reason for them to avoid the administrative process and file a claim with the district court five months later.

Respondents also argue Cort v. Ash, 422 U.S. 66, 95 S.Ct. 2080, 45 L.Ed.2d 26 (1975) establishes that a judicial cause of action may be implied, despite their failure to exhaust administrative remedies. The Cort case detailed a test to determine when causes of action should be implied from statutory schemes. The factors to consider are 1) whether the plaintiff is one of a class for whose especial benefit the statute was enacted, 2) whether there is an indication of legislative intent to create a remedy or deny one, and 3) whether it is consistent with the underlying purposes of the legislative scheme to imply such a remedy. Id. at 78, 95 S.Ct. at 2088.

Contrary to respondents’ contention, these factors weigh against implying a judicial cause of action in the Prevailing Wage Statute. Although respondents are beneficiaries of the statute, the benefit enjoyed is indirect. Rather, the statute specifically states that the “public” and “persons working on public works” are its especial beneficiaries. See Minn.Stat. § 177.41.

In addition, there is no indication of a legislative intent to create a judicial remedy prior to exhaustion of the administrative remedy. The statute explicitly provides for administrative remedies for aggrieved parties. Minn.Stat. § 174.44, subd. 4.

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489 N.W.2d 265, 1 Wage & Hour Cas.2d (BNA) 422, 1992 Minn. App. LEXIS 918, 1992 WL 208572, Counsel Stack Legal Research, https://law.counselstack.com/opinion/counties-of-blue-earth-v-minnesota-department-of-labor-industry-minnctapp-1992.