S 0907

S‑0907.1 _____________________________________________

SENATE BILL 5926

_____________________________________________

State of Washington 57th Legislature 2001 Regular Session

By Senators Costa, Prentice, Roach and Fairley

Read first time 02/08/2001. Referred to Committee on Labor, Commerce & Financial Institutions.

_1 AN ACT Relating to prevailing wage civil penalties; and

_2 amending RCW 39.12.050, 39.12.065, and 39.12.080.

_3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

_4 Sec. 1. RCW 39.12.050 and 1985 c 15 s 3 are each amended to read

_5 as follows:

_6 (1) Any contractor or subcontractor who files a false statement

_7 or fails to file any statement or record required to be filed

_8 under this chapter and the rules adopted under this chapter,

_9 shall, after a determination to that effect has been issued by the

10 director after hearing under chapter 34.05 RCW, forfeit as a civil

11 penalty the sum of five hundred dollars for each false filing or

12 failure to file, and shall not be permitted to bid, or have a bid

13 considered, on any public works contract until the penalty has

14 been paid in full to the director. The civil penalty under this

15 subsection shall not apply to a violation determined by the

16 director to be an inadvertent filing or reporting error. Civil

17 penalties shall be deposited in the public works administration

18 account.

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_1 To the extent that a contractor or subcontractor has not paid

_2 wages at the rate due pursuant to RCW 39.12.020, and a finding to

_3 that effect has been made as provided by this subsection, such

_4 unpaid wages shall constitute a lien against the bonds and

_5 retainage as provided in RCW 18.27.040, ((~~19.28.120~~)) 19.28.041,

_6 39.08.010, and 60.28.010.

_7 (2) If a contractor or subcontractor is found to have violated

_8 the provisions of subsection (1) of this section for a second time

_9 within a five year period, the contractor or subcontractor shall

10 be subject to the sanctions prescribed in subsection (1) of this

11 section and shall not be allowed to bid on any public works

12 contract for one year. The one year period shall run from the date

13 of notice by the director of the determination of

14 noncompliance. When an appeal is taken from the director's

15 determination, the one year period shall commence from the date of

16 the final determination of the appeal.

17 The director shall issue his or her findings that a contractor

18 or subcontractor has violated the provisions of this subsection

19 after a hearing held subject to the provisions of chapter 34.05

20 RCW.

21 Sec. 2. RCW 39.12.065 and 1994 c 88 s 1 are each amended to read

22 as follows:

23 (1) Upon complaint by an interested party, the director of

24 labor and industries shall cause an investigation to be made to

25 determine whether there has been compliance with this chapter and

26 the rules adopted hereunder, and if the investigation indicates

27 that a violation may have occurred, a hearing shall be held in

28 accordance with chapter 34.05 RCW. The director shall issue a

29 written determination including his or her findings after the

30 hearing. A judicial appeal from the director's determination may be

31 taken in accordance with chapter 34.05 RCW, with the prevailing

32 party entitled to recover reasonable costs and attorneys fees.

33 A complaint concerning nonpayment of the prevailing rate of

34 wage shall be filed with the department of labor and industries no

35 later than thirty days from the acceptance date of the public

36 works project. The failure to timely file such a complaint shall

37 not prohibit a claimant from pursuing a private right of action

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_1 against a contractor or subcontractor for unpaid prevailing

_2 wages. The remedy provided by this section is not exclusive and is

_3 concurrent with any other remedy provided by law.

_4 (2) To the extent that a contractor or subcontractor has not

_5 paid the prevailing rate of wage under a determination issued as

_6 provided in subsection (1) of this section, the director shall

_7 notify the agency awarding the public works contract of the amount

_8 of the violation found, and the awarding agency shall withhold, or

_9 in the case of a bond, the director shall proceed against the bond

10 in accordance with the applicable statute to recover, such amount

11 from the following sources in the following order of priority

12 until the total of such amount is withheld:

13 (a) The retainage or bond in lieu of retainage as provided in

14 RCW 60.28.010;

15 (b) If the claimant was employed by the contractor or

16 subcontractor on the public works project, the bond filed by the

17 contractor or subcontractor with the department of labor and

18 industries as provided in RCW 18.27.040 and ((~~19.28.120~~))

19 19.28.041;

20 (c) A surety bond, or at the contractor's or subcontractor's

21 option an escrow account, running to the director in the amount of

22 the violation found; and

23 (d) That portion of the progress payments which is properly

24 allocable to the contractor or subcontractor who is found to be in

25 violation of this chapter. Under no circumstances shall any portion

26 of the progress payments be withheld that are properly allocable

27 to a contractor, subcontractor, or supplier, that is not found to

28 be in violation of this chapter.

29 The amount withheld shall be released to the director to

30 distribute in accordance with the director's determination.

31 (3) A contractor or subcontractor that is found, in accordance

32 with subsection (1) of this section, to have violated the

33 requirement to pay the prevailing rate of wage shall be subject to

34 a civil penalty of not less than one thousand dollars or an amount

35 equal to twenty percent of the total prevailing wage violation

36 found on the contract, whichever is greater, and shall not be

37 permitted to bid, or have a bid considered, on any public works

38 contract until such civil penalty has been paid in full to the

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_1 director. If a contractor or subcontractor is found to have

_2 participated in a violation of the requirement to pay the

_3 prevailing rate of wage for a second time within a five-year

_4 period, the contractor or subcontractor shall be subject to the

_5 sanctions prescribed in this subsection and as an additional

_6 sanction shall not be allowed to bid on any public works contract

_7 for two years. Civil penalties shall be deposited in the public

_8 works administration account. If a previous or subsequent

_9 violation of a requirement to pay a prevailing rate of wage under

10 federal or other state law is found against the contractor or

11 subcontractor within five years from a violation under this

12 section, the contractor or subcontractor shall not be allowed to

13 bid on any public works contract for two years. A contractor or

14 subcontractor shall not be barred from bidding on any public works

15 contract if the contractor or subcontractor relied upon written

16 information from the department to pay a prevailing rate of wage

17 that is later determined to be in violation of this chapter. The

18 civil penalty and sanctions under this subsection shall not apply

19 to a violation determined by the director to be an inadvertent

20 filing or reporting error. To the extent that a contractor or

21 subcontractor has not paid the prevailing wage rate under a

22 determination issued as provided in subsection (1) of this

23 section, the unpaid wages shall constitute a lien against the

24 bonds and retainage as provided herein and in RCW 18.27.040,

25 ((~~19.28.120~~)) 19.28.041, 39.08.010, and 60.28.010.

26 Sec. 3. RCW 39.12.080 and 1993 c 404 s 2 are each amended to read

27 as follows:

28 The public works administration account is created in the state

29 treasury. The department of labor and industries shall deposit in

30 the account all moneys received from fees or civil penalties

31 collected under RCW 39.12.050, 39.12.065, and 39.12.070.

32 Appropriations from the account, not including moneys transferred

33 to the general fund pursuant to RCW 39.12.070, may be made only

34 for the purposes of administration of this chapter, including, but

35 not limited to, the performance of adequate wage surveys, and for

36 the investigation and enforcement of all alleged violations of

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_1 this chapter as provided for in this chapter and chapters 49.48

_2 and 49.52 RCW.

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