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Amaya v. DGS Construction, LLC

United States District Court, D. Maryland

August 19, 2019

MARIO ERNESTO AMAYA, JOSE NORLAND GONZALEZ and JOSE AMADEO CASTILLO, Plaintiffs,
v.
DGS CONSTRUCTION, LLC and THE WHITING-TURNER CONTRACTING COMPANY, Defendants.

          MEMORANDUM OPINION

          THEODORE D. CHUANG UNITED STATES DISTRICT JUDGE

         Plaintiffs Mario Ernesto Amaya, Jose Norlan Gonzalez, and Jose Amadeo Castillo, carpenters formerly employed by Defendant DGS Construction, LLC, d/b/a Schuster Concrete Construction ("Schuster") on the construction of the MGM Resort Casino at National Harbor in Prince George's County, Maryland, have brought suit against Schuster and Defendant The Whiting-Turner Contracting Company ("Whiting-Turner") for violations of the Maryland Wage and Hour Law ("MWHL"), Md. Code Ann., Lab & Empl. §§ 3-101 to 3-131 (West 2016), and the Maryland Wage Payment and Collection Law ("MWPCL"), Md. Code Ann., Lab & Empl. §§ 3-501 to 3-509, as well as for state law claims of breach of contract and unjust enrichment. Plaintiffs also seek a declaratory judgment that they are third-party beneficiaries of a Project Labor Agreement ("PLA") signed by Whiting-Turner and various trade unions. Plaintiffs allege that Schuster failed to pay Plaintiffs at the rate for carpenters for every hour worked and failed to pay certain fringe benefits for overtime work as required by the PLA. Pending before the Court are Plaintiffs' Motion for Partial Summary Judgment and separate Motions for Summary Judgment filed by Whiting-Turner and Schuster. For the reasons that follow, Plaintiffs' Motion is DENIED, Whiting-Turner's Motion is GRANTED, and Schuster's Motion is GRANTED IN PART and DENIED IN PART.

         BACKGROUND

         Relevant factual and procedural background is set forth in the Court's July 10, 2018 Memorandum Opinion granting Plaintiffs' Motion for Class Certification and certifying two classes, the Carpenter Class and the Overtime Fringe Benefit Class. Amaya v. DGS Constr., LLC, 326 F.R.D. 439, 444-16 (D. Md. 2018). Additional information relevant to these Motions is set forth below.

         Whiting-Turner served as the Project Contractor for the construction of the MGM Resort Casino at National Harbor ("the Project"), which was developed by MGM National Harbor, LLC ("MGM"). On September 15, 2014, Whiting-Turner and 16 trade unions ("Unions") entered into the PL A, which governed various aspects of the construction of the Project. Brent Booker, Secretary-Treasurer of the North America's Building Trades Union, representing the Unions, and Hunter Clayton of MGM negotiated the terms of the PLA. The PLA defines the Signatories of the PLA as "all construction contractors and subcontractors of whatever tier engaged in onsite construction work within the scope of this Agreement that sign this Agreement or a letter of assent thereto." Joint Record ("J.R.") 0001, ECF No. 208. The PLA further states that Whiting-Turner "shall require all contractors and subcontractors who have been awarded contracts for work covered by this Agreement to accept and be bound by the terms and conditions" of the PLA "by executing the Letter of Assent... prior to commencing work." J.R. 0003. In paragraph 12.5, the PLA also provides that:

         In the event that the Project Contractor or a Signatory does not receive at least three bids on any trade package from contractors or subcontractors that are qualified to perform the work identified in the trade package and have the business resources necessary to perform the work and which may also have been prequalified prior to bidding ("Qualified Contractor") and are signatories to a collective bargaining agreement with a Union with jurisdiction over the work to be performed, then that trade package shall be exempt from the requirements of this Agreement; provided, however that the Agreement shall apply if the lowest bidder on the trade package is a Qualified Contractor and is a signatory to such a collective bargaining agreement.

         J.R. 0016. The same provision, however, clarified that:

         Exemption from this Agreement shall not automatically relieve the successful bidder from complying with Project based requirements, such as, but not limited to, safety and quality programs. For all contractors working on the project, payment of prevailing wages and fringe benefit rates of the project as indicated on the Maryland Department of Labor, Licensing, and Regulation Informational Wage Rate for Prince George's County determined at the commencement of the Project, which Developer has voluntarily adopted for the Project, shall be a minimum requirement and contractors are free to provide wages and fringe benefits at rates in excess of such prevailing rates.

         Id.

         On December 4, 2014, Schuster entered into an express contract with Whiting-Turner to perform concrete work on the Project. Schuster is a contractor that does not have a collective bargaining agreement with a Union. Schuster was one of only two companies to bid on a particular trade package for concrete work on the project. Since only two bids were received and only one was from a contractor with a signed collective bargaining agreement, the trade package was exempt from the requirements of the PLA, and Schuster did not sign a Letter of Assent or similar document expressly agreeing to the terms of the PLA. Schuster therefore was not a Signatory to the PLA. However, as a subcontractor on the Project, Schuster was required by the PLA to pay prevailing wages and fringe benefit rates as stated in the Maryland Department of Labor, Licensing, and Regulation ("DLLR") Informational Wage Rate for Prince George's County.

         Schuster was also subject to the Whiting-Turner Project Manual, which established basic hourly rates and fringe benefit payments for various classifications of workers. According to the Project Manual, these rates "were derived from" the DLLR Informational Wage Rates for Prince George's County. J.R. 0146. Plaintiffs were each employed by Schuster during several months in 2015.

         When Schuster hired workers for the Project, its representatives met with prospective workers and completed a "Referral Sheet" for each applicant. J.R. 00375. Schuster considered the Referral Sheet to be an "employment offer" that, along with other documents, formed an employment agreement with a particular employee. Id. According to Lorraine Burns, Schuster's Chief Financial Officer ("CFO"), a representative from Human Resources would review the Referral Sheet, which listed the applicant's starting job title and hourly rate for Schuster jobs, with the applicant. If the applicant did not approve of the rate of pay listed on the Referral Sheet, there was no hire. Although Schuster has Referral Sheets for Amaya, Gonzalez, and Castillo that list the employee's name, the date of application and hire, the Schuster foreman who referred the employee, the salary as approved by that foreman, the work assignment at the Project, and the date of the employee's first day on the Project, neither a Schuster employee nor the Plaintiff signed the document.

         The Referral Sheets reference a pay rate of $17 per hour for Amaya and Gonzalez and $20 per hour for Castillo for work performed for Schuster outside of the Project. According to Burns, "whenever the Plaintiffs worked at the Project, Schuster paid the Plaintiffs in accordance with the minimum wage rates in Section S.3 of the Project Manual," which were higher than these figures. J.R. 00376.

         In their depositions, Amaya, Gonzalez, and Castillo explained how they were hired to work on the Project. Amaya stated that he applied for the job on the Project because he had heard from Gonzalez, who is his nephew, and other workers that Schuster was paying carpenters a wage of $35 per hour. He denied that he was told that his rate on Schuster projects other than the Project would be $17 per hour or that the Referral Sheet was used in discussions regarding his pay rate. He acknowledged, however, that he was given the Referral Sheet so that he would know where and when to report for training and for work. Amaya did not remember what other employment documents he filled out and stated that Schuster's human resources representative filled out those documents for him.

         Gonzalez stated that he was told by a colleague at another construction company that he would be paid at "scale" if he worked for Schuster on the Project. J.R. 01688. He then went to Schuster's office and filled out an application to work on the Project, with the assistance of a human resources representative. The representative told him that his regular salary would be $17 per hour - the amount listed on the Referral Sheet - but when he stated that he had been making $27 per hour at another company, she told him that his salary on the Project would be higher and that it would be arranged later with his foreman.

         Castillo learned of the Project from one of Schuster's foremen, Sergio Martinez, who told Castillo that Schuster paid $26 per hour and offered a retirement plan. Castillo also filled out an application at Schuster's office with the help of a secretary and was told where to report the next day. Castillo was angry when his first paycheck was at a rate of $20 per hour, not $26.

         In Count I of the Amended Complaint, Plaintiffs seek a declaratory judgment against Defendants that they are third-party beneficiaries of the PLA. In Count II, Plaintiffs assert a breach of contract claim against Defendants, alleging that Schuster breached the PLA by failing to pay Plaintiffs in accordance with the PLA and that Whiting-Turner breached that agreement by not assuring Schuster's compliance with the PLA. In Count III, Plaintiffs assert that Schuster violated the MWHL by failing to pay Plaintiffs legally mandated overtime pay. In Count IV, they assert a violation of the MWPCL based on Schuster's failure to pay Plaintiffs' wages in accordance with the rates required by the PLA and the Project Manual, including overtime and fringe benefits. Finally, in Count V, Plaintiffs allege a claim of unjust enrichment against Schuster because Schuster inequitably retained a benefit from Plaintiffs' labor by not compensating them under the terms of the PLA. On July 10, 2018, the Court certified two classes of Plaintiffs, the Carpenter Class and the Overtime Fringe Benefit Class. Amaya, 326 F.R.D. at 448, 450.

         DISCUSSION

         Plaintiffs seek summary judgment on behalf of the Carpenter Class and the Overtime Fringe Benefit Class on both Counts I and II, arguing that the Unions' intent that non-union workers benefit from the PLA gives them status as third-party beneficiaries to the PLA and that Schuster's time-splitting scheme and failure to pay fringe benefits on overtime hours and Whiting-Turner's failure to correct Schuster's conduct breached the terms of the PLA as to both classes of Plaintiffs. Plaintiffs also seek summary judgment on ...


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