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NATIONAL SHOPMEN PENSION FUND v. BURTMAN IRON WORKS

July 13, 2001

NATIONAL SHOPMEN PENSION FUND, ET AL., PLAINTIFFS,
v.
BURTMAN IRON WORKS, INC., AND QUALITY STRUCTURES OF AMERICA, INC., DEFENDANTS.



The opinion of the court was delivered by: Ellen Segal Huvelle, United States District Judge.

MEMORANDUM OPINION

Before the Court are the motion for summary judgment of plaintiffs National Shopmen Pension Fund (the "Fund") and its Trustees, the opposition of defendants Burtman Iron Works, Inc. ("Burtman") and Quality Structures of America, Inc. ("Quality"), and plaintiffs' reply. Plaintiffs bring this action pursuant to the Employee Retirement Income Security Act ("ERISA"), 29 U.S.C. § 1132(g)(2), which entitles trustees to bring an action for or on behalf of a plan to collect delinquent contributions. This action is also brought under Section 301 of the Labor Management Relations Act, 29 U.S.C. § 185, which provides for enforcement of the terms of a collective bargaining agreement. Plaintiffs seek to recover delinquent contributions, interest thereon, liquidated damages, attorney's fees, audit fees, and other costs. Plaintiffs also seek an injunction preventing defendants from failing to furnish required contributions and remittance reports in a timely fashion. Based on the record before the Court, plaintiffs' motion for summary judgment is granted in part and denied in part.

BACKGROUND

The National Shopmen Pension Fund is a joint labor-management fund that provides pension, retirement, and related benefits to the eligible employees of those employers who contribute to the Fund. Employers contribute to the Fund pursuant to various collective bargaining agreements with affiliated Shopmen's Local Unions of the International Association of Bridge, Structural, Ornamental and Reinforcing Iron Workers (the "Union"). Burtman is a Massachusetts corporation, and Quality is a Rhode Island corporation. Both defendants conduct business in the State of Massachusetts. The Union and Burtman have been parties to and bound by a series of collective bargaining agreements since 1995, and the Union has been the exclusive bargaining representative of Burtman's production and maintenance employees. The two applicable agreements were signed in 1995 and 1998. The agreements require Burtman to pay 71 cents into the Fund "for each hour of pay paid to each employee. . . ."

In February 1999 Quality moved all of its operations from Rhode Island to Burtman's Readville, Massachusetts facility. Plaintiffs and defendants have jointly stipulated that Burtman and Quality constitute a single employer, and therefore, they are jointly and severally liable for any failure to contribute to the Fund. See Board of Trustees, Sheet Metal Workers' Local Union 102 Health Benefit Fund v. Gibson Brothers, No. 820329, 1982 U.S. Dist. Lexis 10069, *8 (D.D.C. Oct. 27, 1982) (single employer doctrine enunciated in Radio and Television Broadcast Technicians Local Union 1264 v. Broadcast Services of Mobile, Inc., 380 U.S. 255 (1965), provides the appropriate framework for determining non-signatory's liability for obligations under the terms of signatory's collective bargaining agreement).

The Fund hired Patrick Reid, a certified public accountant, to perform a payroll review for the period 1996 through 2000. Reid's payroll review showed that defendants failed to report to the Fund a number of hours allegedly amounting to a delinquency of $48,805.77. It is also alleged that defendants have breached the agreement by failing to remit contributions or remittance reports (reports listing the hours for which contributions are due) for Burtman's covered employees for January 2001 and for Quality's covered employees for January through March 2001. Based on hours reported to the Fund, defendants claim $8,032.90 for January and February 2001.

The motion raises six principal issues: (1) whether defendants are obligated under the contract to make contributions on behalf of temporary employees; (2) whether defendants are obligated under the contract to make contributions for the hours of paid commuting time; (3) whether defendants must contribute for part-time employee Jose Neal; (4) whether defendants must contribute to the fund starting on the first day of employment; (5) whether plaintiffs are abusing their discretion by not waiving liquidated damages, attorney's fees, audit costs, and other costs; and (6) whether plaintiffs are entitled to an injunction to require defendants to submit contributions and remittance reports.

LEGAL ANALYSIS

Standard of Review

Under Fed.R.Civ.P. 56, a motion for summary judgment shall be granted if the pleadings, depositions, answers to interrogatories, admissions on file, and affidavits show that there is no genuine issue of material fact, and that the moving party is entitled to judgment as a matter of law. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). In considering a motion for summary judgment, the "evidence of the non-movant is to be believed, and all justifiable inferences are to be drawn in his favor." Id. at 255; see also Washington Post Co. v. United States Dep't of Health and Human Servs., 865 F.2d 320, 325 (D.C. Cir. 1989).

The non-moving party's opposition, however, must consist of more than mere unsupported allegations or denials and must be supported by affidavits or other competent evidence setting forth specific facts showing that there is a genuine issue for trial. Fed.R.Civ.P. 56(e); Celotex Corp. v. Catrett, 477 U.S. 317, 324 (1986). The non-moving party must provide evidence that would permit a reasonable jury to find in the non-moving party's favor. Laningham v. United States Navy, 813 F.2d 1236, 1242 (D.C. Cir. 1987). "If the evidence is merely colorable, or is not significantly probative, summary judgment may be granted." Liberty Lobby, 477 U.S. at 249-50 (citations omitted).

"Whether an agreement is clear on its face or ambiguous has a direct bearing on the

appropriateness of summary judgment in contract disputes. Generally, interpretation of a facially clear contract is considered a question of law and is for the court." NRM Corp. v. Hercules, Inc., 758 F.2d 676, 682 (D.C. Cir. 1985) (quotations and citations omitted). In a matter involving a contract, summary judgment is appropriate where the agreement "admits of only one reasonable interpretation." United Mine Workers of America 1974 Pension v. Pittston Co., 984 F.2d 469, 473 (D.C. Cir. 1993).

Section 502 of ERISA allows plan fiduciaries to sue employers in federal court to recover delinquent payments to benefit plans. 29 U.S.C. § 1132. Section 515 of ERISA states that every "employer who is obligated to make contributions to a multiemployer plan under the terms of the plan or under the terms of a collectively bargained agreement shall, to the extent not inconsistent with law, make such contributions in accordance with the terms and conditions of such plan or such agreement." 29 U.S.C. § 1145.

Temporary Employees

From approximately April 2000 through October 2000, defendants employed production and maintenance workers who were hired through two temporary employment agencies. According to defendants, 95% of these temporary workers' time was devoted to work covered by the 1998 Agreement. (See Memorandum in Support of Plaintiffs' Motion for Summary Judgment Ex. I at p. 41-42.) However, defendants argue that they are not obligated to contribute to the Fund for these employees.

Defendants claim that they do not owe contributions to the Fund because the temporary employees are not common-law employees based on the 12-factor test articulated in Nationwide Mutual Insurance Company v. Darden, 503 U.S. 318 (1992). As a result, defendants argue that at a minimum, there are issues of fact as to whether the temporary employees are common-law employees. Darden, however, is inapposite because it addressed whether a person had standing under ERISA to bring an action for benefits. Id. at 320-321. Determining whether temporary employees hours are covered by the collective bargaining agreement is an issue of contract interpretation, because "employers must contribute to multiemployer ...


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