Historically, the prevailing wage was calculated by averaging the wages within a certain industry and county. However, in 2018 the Washington Legislature amended the statute so that the prevailing wage would be assessed based on the highest wage set by collective bargaining agreements in the county. The amendment (RCW 39.12.015(3)) reads as follows:
(3)(a)…the industrial statistician shall establish the prevailing rate of wage by adopting the hourly wage, usual benefits, and overtime paid for the geographic jurisdiction established in collective bargaining agreements…
(b) For trades and occupations in which there are no collective bargaining agreements in the county, the industrial statistician shall establish the prevailing rate of wage by…conducting wage and hour surveys.
So, for example, if union engineers bargain for a wage, that is the wage all engineers in the county must be paid on public projects. The legislature passed this law for the sake of efficiency because it took significant resources for the Industrial Statistician to compute the prevailing wage for every trade and every county, but the law has significant knock-on effects.
One issue is that collective bargaining agreements do not necessarily observe county lines, and so a collective bargaining agreement may be in effect in multiple counties simultaneously. So, for instance, a collective bargaining agreement mandating a wage of $50/hr could be in effect in County A and County B. But the average wage for County A could be $49/hr and the average wage for County B could be $25/hr. So, in County A, the prevailing wage would be similar to the average wage, but in County B the prevailing wage would be double the average wage.
This amendment, and subsequent lawsuits, have somewhat of a tortured history, as chronicled in our blogs: Court of Appeals Reverses Prevailing Wage Rate Statute for Public Work Projects; Supreme Court Holds that Prevailing Wage Statute is Constitutional; Portion of Washington State’s Prevailing Wage Statute Struck Down…Again.
Most recently, the Association of General Contractors et. al., argued that the amendments were unconstitutional under the Washington State Constitution because they conflicted with another prevailing wage statute (RCW 39.12.026(1)). Associated Gen. Contractors of Washington v. State, 544 P.3d 486, 491 (2024).
The conflicting law reads:
- In establishing the prevailing rate of wage under RCW 39.12.010, 39.12.015, and 39.12.020, all data collected by the department of labor and industries may be used only in the county for which the work was performed.
The conflicting law required the use of data from only one county (the county where the work was performed). Collective bargaining agreements can, and often do, span multiple counties. Therefore, the AGC argued that the two statutes are in conflict. The Washington State Constitution Article II, Section 37 says that it is unconstitutional for the legislature to revise a law so that conflicts with an existing law. So, AGC argued, the new amendment was unconstitutional.
However, the Washington Supreme Court held that these two statutes were not, in fact, in conflict because the single county requirement refers only to the data collection method, and not collective bargaining agreements. The plain language of the single-county requirement is that “all data collected…may be used only in the county for which the work was performed.” RCW 39.12.026. The court held that adopting the rates specified in collective bargaining agreements are not “data collected.” Because the statute only mandated the single-county requirement to situations where data was collected, and rates in collective bargaining agreements are not data collection, the statutes do not conflict—they apply to different practices.
The court also highlighted the use of the word “adopt” in the amendment, which reads: “the industrial statistician shall establish the prevailing rate of wage by adopting the hourly wage.” While the amendment uses the word “adopt,” the conflicting law refers to “all data collected.” This difference in verb choice, the court said, indicates that the two laws do not refer to the same thing.
At the time the conflicting law was enacted, data collection was the only method contemplated for determining prevailing wage. So, the statute can only refer to that method. This seems a bit woolly as courts have held on a number of occasions that things that did not exist at the time a statute was enacted in fact are included within a statute.