STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

FLORIDA HOME BUILDERS )

ASSOCIATION, et al., )

)

Petitioners, )

)

vs. ) CASE NO. 77-1569RX

) DIVISION OF LABOR, BUREAU OF ) APPRENTICESHIP, )

)

Respondent, )

and )

) FLORIDA BUILDING TRADES COUNCIL, )

et al., )

)

Intervenors. )

)

RECOMMENDED ORDER

Pursuant to notice, an administrative hearing pursuant to the provisions of Florida Statutes, Section 120.56, was held before Diane D. Tremor, Hearing Officer with the Division of Administrative Hearings, commencing on September 28 and continuing on October 2, 1978, in Room 103, Collins Building, Tallahassee, Florida.

APPEARANCES

For Petitioners: Steven W. Metz

Post Office Box 1259 Tallahassee, Florida 32302

For Respondent: Kenneth H. Hart, Jr.

Room 401, Collins Building Tallahassee, Florida 32304

For Intervenors: Jerry G. Traynham

Patterson and Traynham 1215 Thomasville Road

Tallahassee, Florida 32303

1. By a petition, as amended, filed pursuant to Florida Statutes, Section 120.56, petitioners challenge the respondent's Rule 8C-16.05, subsections (2)(e)(2) and (5) claiming that it is an invalid exercise of delegated legislative authority. The sections of the rule being challenged herein provide as follows:

   
   

   8C-16.05 Standards of Apprenticeship.

   The following standards are prescribed for an apprenticeship program:

   * * *

   (e) Wage Provision -

   * * *

   (2) The entry apprentice wage rate shall be not less than 50 percent of the established journeyman hourly rate paid by all partici- pating employers in the program, unless a different percentage is provided for in a collective bargaining agreement. Provided further that if a higher journeyman hourly rate is established for a particular project pursuant to state or federal law, the higher rate so established shall be controlling for purposes of determining apprentice wages applicable to the particular project.

   (5) The minimum hourly apprentice wage rate paid during the last period of apprenticeship shall be not less that 85 percent of the established journeyman wage rate, unless a different percentage is provided for in a collective bargaining agreement.

   
   

2. It is the petitioners' contentions that the cited portions of Rule 8C-

   16.05 lack statutory authority, conflict with F.S. Section 446.081(1), rely upon a standard never adopted as a rule, have no factual basis, constitute an arbitrary, irrational and unreasonable exercise of authority and have an invalid economic impact statement. The respondent and the intervenor deny these assertions, and respondent further contends that petitioners have failed to demonstrate that they are substantially affected by the subject rule and therefore that they lack standing to challenge it. Respondent further contends that petitioners are barred from raising the issue concerning the rule's statement of economic impact by virtue of F.S. Section 120.54(2)(c).

   
   

3. With regard to the issue of whether an adequate statement of economic impact was provided, the undersigned agrees with respondent that the rule cannot be declared invalid on this ground due to the provisions of F.S. Section 120.54(2)(c), as amended by Chapter 78-425, Laws of Florida. This section now provides:

   
   

   (c) Failure to provide an adequate state- ment of economic impact is grounds for holding the rule invalid; however, beginning October 1, 1978, no rule shall be declared invalid for want of an adequate statement of economic impact unless the issue is raised in an administrative or judicial proceeding within 1 year of the effective date of the rule to which the statement applies."

   
   

4. The rule under challenge in this proceeding became effective on February 3, 1977. The original petition was filed with the Division of Administrative Hearings on September 1, 1977. Said petition did not claim the lack of an adequate economic impact statement as grounds for invalidating the rule. This ground was not raised by petitioners until September 20, 1978, the date of their amended petition. The statutory language cited above is without ambiguity. The Legislature clearly barred, as of October 1, 1978, the act of declaring a rule invalid for want of an adequate economic impact statement

   unless the issue is raised within one year of the effective date of the rule. The effective date of the subject rule being February 3, 1977, and the issue not being raised by petitioners until September 20, 1978, renders the Division of Administrative Hearings without jurisdiction to consider the issue of the adequacy of the respondent's statement of economic impact.

   
   

5. As statutory authority for the challenged rule, respondent points to various provisions of Chapter 446, Florida Statutes. Section 446.031(2) directs the Division of Labor to establish standards and policies regarding apprentice programs and agreements, and authorizes the Division to issue rules and regulations necessary to carry out such standards and policies. Section 446.041(3) mandates that the Department of Commerce

   
   

   "Shall also establish uniform apprentice- ship standards which shall not be limited to traditional training standards or tradi- tional apprenticeable occupations."

   
   

   Section 446.041(2)(a)(2) mandates the Bureau of Apprenticeship to administer the "uniform preapprenticeship and apprenticeship standards established by the Department of Commerce. Respondent further points to Sections 446.011 and

   446.101 to illustrate that the intent of the Legislature in enacting laws pertaining to apprentices, and thus of the respondent in promulgating a rule relating to apprenticeship wages, was the protection of the apprentice and the furtherance of apprenticeship training programs in Florida. The undersigned finds and so concludes that a rule, if otherwise valid, relating to wages to be paid apprentices constitutes a standard or policy within the meaning of the statutory language cited above.

   
   

6. Having found that a rule relating to wages for apprentices is statutorily authorized, it now is necessary to determine whether the rule in question is a valid exercise of that authority. The portions of the rule in question do two things: they set a specified percentage to be paid to certain apprentices and they exempt from said percentage requirements those apprentices covered by a collective bargaining agreement which provides for a "different" percentage. These provisions must be considered in light of the statutory authorization and intent.

   
   

7. After carefully reviewing the evidence, statutory provisions and the parties' legal argument with regard to this issue, it is concluded that a rule relating to wages which exempts from its provisions the "different" percentages provided for in a collective bargaining agreement constitutes an invalid exercise of delegated legislative authority. As noted above, the statutory provision relating to standards for the apprenticeship program speak in terms of "uniform" standards. "Uniform" is generally regarded to apply equally to all those affected. The only exception or limitation to this requirement of uniformity is contained in F.S. Section 446.081, which provides as follows:

"(1) Nothing in this chapter or in any apprentice agreement approved under this chapter shall operate to invalidate any apprenticeship provision in any collective agreement between employers and employees

setting up higher apprenticeship standards." 1/

Thus, while a collective agreement between employers and employees may set up higher apprenticeship standards than the minimum standards approved or

authorized by Chapter 446, it follows that such agreements may not contain lower standards. Stated differently, F.S. Section 446.081 allows different standards between union and nonunion apprenticeship programs only when higher standards are provided in the collective bargaining agreement. Had the Legislature intended to exempt all provisions of a collective bargaining agreement from the statewide standards, it would have been a simple matter to indicate such intent by using the word "different," "other" or by simply omitting any adjective to describe such apprenticeship standards. Having specifically exempted "higher" standards, it cannot be assumed that the Legislature also intended to exempt lower standards.

8/ The rule in question, by referring to a "different percentage" provided for in a collective bargaining agreement, rather than a "higher" percentage, allows unions or other groups covered by a collective bargaining agreement to establish standards lower than the statewide minimum uniform standards. Indeed, the evidence adduced at the hearing illustrates that some collective bargaining agreements do in fact provide for an entry apprentice wage rate of thirty-five percent (35 percent) of the established journeyman hourly rate. This conflicts with the statutory requirement of uniformity in standards, and is not within the exception or limitation allowed in Section 446.081(1). The respondent and the intervenor assert that the purpose and rationale for the subject rule are to protect apprentices where they are not otherwise represented through the collective bargaining process. They further point out that the collective bargaining agreements generally contain provisions for apprentices to receive fringe benefits in addition to their rate of pay. While such rationale may be laudable, it simply finds no authority in the statutes and, indeed, conflicts with Section 446.081(1). The Legislature recognized the existence of collective bargaining agreements and expressly provided that said agreements could contain higher standards. Such an expression negates the promulgation of a rule which would permit a lower standard. Therefore, those portions of Rule 8C- 16.05(2)(e)(2) and (5) which contain the language "unless a different percentage is provided for in a collective bargaining agreement" are without statutory authority and constitute an invalid exercise of delegated legislative authority. Having found a lack of statutory authority, it is unnecessary to rule upon the arguments concerning the State's intrusion into an area (collective bargaining) regulated and/or prompted by federal law.

1. Petitioners allege that the rule in question is invalid because the apprentice wage rate is based upon the established journeyman hourly rate and the method and manner of calculating this latter rate is not established or defined by a promulgated rule. This contention lacks merit and does not provide grounds for invalidating the challenged protions of Rule 8C-16.05. "Established journeyman hourly rate" is defined in the respondent's Rule 8C-16.02(17). If petitioners are of the opinion that said rule does not constitute an adequate definition, they may exercise their right to petition the respondent for adoption of a more detailed rule, pursuant to the provisions of Florida Statutes, Section 120.54(5). The present rule challenge proceeding is not the proper forum for such an allegation.

   
   

2. It is further alleged by the petitioners that the fifty percent (50 percent) figure set forth in the challenged rule finds no basis in fact and is not supported by any studies, research or statistics performed or obtained on behalf of the respondent. The testimony adduced at the hearing indicates that none of the respondent's present administrators participated in any studies or statistical findings regarding the appropriateness of the percentages of fifty and eighty-five for the two levels of apprentices. The testimony established that the present administrators who had a part in promulgating this rule relied

   upon the Department's past experience with these percentages and the expertise of past administrators and advisory councils. The testimony further established that the purpose of the wage rule is to protect apprentices and to further the apprenticeship training program. Absent any conclusive proof by the petitioners that these percentages bear no relationship to the purposes of the wage rule, the undersigned concludes that this contention is without merit.

   
   

3. Finally, it is concluded that petitioners have adequately illustrated that they are substantially affected by the challenged rule. The petitioners represent nonunion or nonjoint contractors in Florida and do not participate in collective bargaining agreements. As such, they are subject to the rule's requirement to pay their apprentices the entry wage rate of not less than fifty percent of the established journeyman hourly rate and to pay eighty-five percent of said rate to their apprentices during the last period of apprenticeship. The rule's exclusionary provision for apprentices represented by a collective bargaining agreement presents a distinct competitive economic disadvantage to nonunion employers when bidding upon prevailing wage or public works contracts. The evidence established that the prevailing wage rate is generally the negotiated rate set forth in a collective bargaining agreement, at least in the large, urban areas of the State. If the nonunion employer is required to pay his apprentices fifty percent of said rate, and the union employer is permitted to pay his apprentices only thirty-five percent of that rate, the nonunion employer is obviously at a distinct disadvantage in the competitive bidding process. The petitioners thus are substantially affected by the provisions of Rule 8C-16.05, and have standing to challenge said rule pursuant to F.S. Section 120.56.

Whereupon, it is ORDERED that:

1. Petitioners are substantially affected by Rule 8C-16.05(2)(e)(2) and

   (5) and have standing to seek an administrative determination of their validity under F.S. Section 120.56;

   
   

2. The Division of Administrative Hearings lacks authority to rule upon the adequacy of the rule's statement of economic impact by virtue of F.S. Section 120.54(2)(c);

   
   

3. The respondent has statutory authority to promulgate a rule relating to the wages to be paid apprentices;

   
   

4. Those portions of Rule 8C-16.05(2)(e)(2) and (5) reading "unless a different percentage is provided for in a collective bargaining agreement" constitute an invalid exercise of delegated legislative authority; and

   
   

5. Petitioners have failed to demonstrate that the remaining portions of the challenged rule are invalid.

Done and ordered this 1st day of November, 1978 in Tallahassee, Florida.

DIANE D. TREMOR

Hearing Officer

Division of Administrative Hearings

530 Carlton Building Tallahassee, Florida 32304 (904) 488-9675

ENDNOTE

1/ Also see F.S. Section 215.19(1)(d) which refers to the "apprenticeship agreement of higher standards as provided in Section 446.081."

COPIES FURNISHED:

Steven W. Metz

Post Office Box 1259 Tallahassee, Florida 32302

Kenneth H. Hart, Jr.

Room 401, Collins Building Tallahassee, Florida 32304

Jerry G. Traynham Patterson and Traynham 1215 Patterson Road

Tallahassee, Florida 32303

Liz Cloud, Chief

Bureau of Administrative Code 1802 Capitol Building

Tallahassee, Florida 32304

Carroll Webb, Executive Director Administrative Procedures Committee Room 120 - Holland Building Tallahassee, Florida 32304

Docket for Case No: 77-001569RX

Orders for Case No: 77-001569RX