Rodney L. Bean, Esquire
Charles
F. Donnelly, Esquire
Robert M. Steptoe, Jr., Esquire
Donnelly
& Carbone
Steptoe & Johnson
Charleston,
West Virginia
Charleston, West Virginia
Attorney
for Appellees
Attorneys for Island Creek, CONSOL
& Laurel Run
The Opinion of the Court was delivered PER CURIAM.
JUSTICE STARCHER dissents and reserves the right to file a dissenting Opinion.
JUSTICE MCGRAW dissents and reserves the right to file a dissenting Opinion.
Per Curiam:
Through this appeal, Appellant
Island Creek Coal Company (Island Coal) seeks a reversal of the January
3, 2000, decision of the Circuit Court of Logan County finding it liable under
the West Virginia Wage Payment and Protection Act (Act), West Virginia
Code §§ 21-5-1 to -18 (1996), for two arbitration awards and one Mine
Safety and Health Administration (MSHA) award issued against Mutual
Mining, Inc. (Mutual Mining) in favor of Appellees John Taylor et
al.See footnote 1 1 After
examining this issue, we determine that the lower court was in error and accordingly,
reverse.
In Conrad, this Court
was asked to determine whether a lower court correctly ruled that payments required
under the federal WARNSee footnote 6 6
Act (for failure to give workers a full sixty-day notice and wages prior
to a plant closing) were not wages under the Act. Disregarding the
rubric used in describing the WARN payments (back pay), we considered and adopted
the reasoning of other courts on this issue--that such payments are viewed as
damages awarded for violation of a legislative act and not compensation
for past services. Affirming the lower court's ruling, we held that the WARN
payments were not compensation for services rendered but [we]re damages designed to compensate employees for an employer's failure to provide the
required sixty days' notice prior to [plant] closure. 206 W.Va. at 50,
521 S.E.2d at 542.
The circuit court, upon being
apprised of the Conrad ruling, informed counsel that I do not find
it to have altered this decision. By order dated January 3, 2000, the
lower court awarded to Appellees the amount of $519,681.94, plus interest. Appellants
do not challenge the portion of this amount which represents wages or fringe
benefits owed to Appellees.See footnote
7 7 Instead, they challenge the inclusion of $279,291.12 based
on the fact that this amount represents moneys that were either awarded through
arbitration proceedings or as a result of an MSHA proceeding. Appellants contend
that Conrad prohibits collection of these amounts under the Act since
such amounts are more in the nature of a damage award, rather than
payment for labor or services. See W.Va. Code § 21-5-1(c) (defining
wages under the Act).
Given the differing facts underlying each of the three awards challenged by Appellants, we briefly set forth the particulars concerning the arbitration and MSHA awards at issue.
.
Like the circuit court, Appellees
treat Conrad as inapposite authority,See
footnote 13 13 and rely instead on a decision issued by the United
States District Court of Appeals in Stump v. Cyprus Kanawha Corp., 919
F.Supp. 221 (S.D. W.Va. 1995). Appellees cite Stump for the proposition
that arbitration awards can be enforced through the Act. Appellees' reliance on
Stump was clearly misguidedSee footnote
14 14 for several reasons. In deciding that preemption under the
Labor Management Relations Act was not required in Stump, the district
court relied on Albradco, Inc. v. Bevona, 982 F.2d 82 (2nd Cir. 1982).
The New York statute being interpreted in Albradco, as Appellants note,
is written in much broader terms than our Act. Rather than limiting recovery under
the applicable statute to wages, as our Act does, the New York statute
encompasses all debts, wages or salaries due and owing. Id.
at 84 (quoting N.Y.B.C.L. § 630(a)) (emphasis supplied). Most critical,
however, is the fact that both Albradco and Stump were concerned
with the issue of preemption, under either ERISA or the Labor Management Relations
Act. Thus, the issue of whether an arbitration award can be enforced through a wage payment
and collections act was not directly under consideration. Rather than looking
to the Stump decision, the lower court should have viewed Conrad
as the controlling authority since that decision, unlike Stump, directly
addressed what constitutes wages under the Act.
Notwithstanding its remedial
purposes,See footnote 15 15
Appellants observe that the Act, is clearly geared toward the collection
of wages. See Farley v. Zapata Coal Corp., 167 W.Va.
630,639, 281 S.E.2d 238, 244 (1981) (stating that [b]oth the Wage Payment
and Collection Act and our mechanics' lien statutes are designed to protect
the laborer and act as an aid in the collection of compensation wrongfully
withheld) (emphasis supplied). Emphasizing that the Act is not a collection
mechanism for other types of debts for which alternate collection means are
available, Appellants reason that, by permitting the Act to be used to collect
debts other than those properly falling within its parameters, the Court would
be fashioning a remedy that was not sanctioned by the Legislature and thereby
wrongly subjecting entities to the punitive penalties associated with the Act's
violation, such as liquidated damages and attorney's fees.See
footnote 16 16 See W.Va. Code §§ 21-5-4(e);
21-5- 12(b).
Both the MSHA award and the
Tanzman award easily fall within the reaches of our Conrad decision.
In each of those matters, the remedy fashioned was an award of back pay. Such
amounts, just as in Conrad, were awarded not for labor or services
rendered, but instead as a form of damages for violation of the collective
bargaining agreement. We were clear in Conrad that amounts awarded as
a form of damages do not qualify as wages under the Act. See
206 W.Va. at 50, 521 S.E.2d at 542.
Less clear, however, is the
Parkinson award, which concerned the award of graduated vacation pay. Appellees
properly characterize graduated vacation pay as fringe benefits. See
W.Va. Code § 21-5-1(l). Given the inclusion of fringe benefits within
the definition of wages, Appellees summarily conclude that the award
of graduated vacation pay is necessarily an amount they can recover under the
Act. See W.Va. Code §§ 21-5-1(c), (l). Despite the
inclusion of fringe benefits within the definition of wages, Appellants point
out that the graduated vacation pay at issue in the arbitration award was not earned by Appellees in connection with their work for Mutual
Mining. See W.Va. Code § 21-5-1(c). Instead, it was a form
of pay to which the terms of the wage agreement entitled them based on their
previous years of employment with Elk Mining. Appellants argue that because
the Parkinson award only resulted through an adjudication and finding
of liability, it is a form of damage that falls outside the
reach of the Act. See Conrad, 206 W.Va. at 48, 521 S.E.2d at 540.
If this award of graduated
vacation pay had first accruedSee footnote
17 17 during the period when Appellees were employed by Mutual
Mining, rather than when they were employed by Elk Mining, we would be more
willing to consider that vacation pay as having been earned rather
than being awarded as a form of damages as a direct result of legal proceedings
under the rationale of Conrad. See 205 W.Va. at 48, 521 S.E.2d
at 540. Under the facts presented, we find the graduated vacation pay awarded
by the arbitrator in the Parkinson matter to be more akin to an award of damages
than to an award of wages, as that term is defined by the Act. See
W.Va. Code § 21-5-1(c); Conrad, 205 W.Va. at 50, 521 S.E.2d
at 542.
Based on the foregoing, we reverse
the decision of the Circuit Court of Logan County.
Reversed.
Whenever
any person, firm or corporation shall contract with another for the performance
of any work which the prime contracting person has undertaken to perform for
another, the prime contractor shall become civilly liable to employees engaged
in the performance of work under such contract for the payment of wages and
fringe benefits, exclusive of liquidated damages as provided in section four
(e) of this article, to the extent that the employer of such employee fails
to pay such wages and fringe benefits. . . .
W.Va. Code § 21-5-7.