No. SCWC-19-0000095, Thursday, December 5, 2024, 2 p.m.

ECKARD BRANDES, INC., Respondent/Appellant-Appellee, vs. DEPARTMENT OF LABOR AND INDUSTRIAL RELATIONS, Respondent/Appellee-Appellee and SCOTT FOYT, Petitioner/Intervenor-Appellant.

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The above-captioned case has been set for oral argument on the merits at:

Supreme Court Courtroom
Ali‘iōlani Hale, 2nd Floor
417 South King Street
Honolulu, HI 96813

The oral argument will also be livestreamed for public viewing via the Judiciary’s YouTube channel at YouTube.com/hawaiicourts and ʻŌlelo Community Television olelo.org/tv-schedule/.

Attorney for Petitioner/Intervenor-Appellant SCOTT FOYT:
     Shawn A. Luiz

Attorney for Respondent/Appellant-Appellee ECKARD BRANDES, INC.: 
     Richard M. Rand of Marr Jones & Wang

NOTE: Certificate of Recusal, by Associate Justice Lisa M. Ginoza, filed 07/31/24.

NOTE: Order assigning Circuit Judge Matthew J. Viola in place of Ginoza, J., recused, filed 09/09/24.

NOTE: Order accepting Application for Writ of Certiorari, filed 09/12/24.

COURT: Recktenwald, C.J., McKenna, Eddins, Devens, JJ., and  Circuit Judge Viola, in place of Ginoza, J., recused

Brief Description:

     This case concerns a dispute over wages paid by Eckard Brandes, a contractor for public works projects in Hawai‘i, and Scott Foyt, a former employee of Eckard Brandes.  HRS Chapter 104-2(b) requires that every laborer working on the construction site of a public work project must be paid no less than a prevailing wage by the director of the Department of Labor and Industrial Relations (DLIR).  During the times relevant to this case, Eckard Brandes did public works projects including inspection, cleaning, and repair work on sewer pipes.

In 2005, the DLIR director sent a letter to Eckard Brandes indicating that inspection and cleaning functions would no longer be covered by HRS Chapter 104, so Eckard Brandes would no longer be required to pay employees performing inspection and cleaning work at the higher prevailing wage.  Eckard Brandes thus paid employees different wages, depending on the work being done and tools being used.  Foyt’s main duties included cleaning, and Eckard Brandes paid him at a lower wage.  In 2013, the DLIR director (a different director from 2005) wrote another letter indicating that when cleaning and inspection work are performed as part of a project that also includes repair work, the cleaning and inspection work is covered by HRS Chapter 104 and thus subject to a higher wage.

Foyt then filed a complaint with the DLIR, alleging that Eckard Brandes inappropriately paid him the lower wage when he was doing cleaning work for projects he worked on between 2011 and 2013.  A DLIR hearings officer agreed, and the DLIR director affirmed the inspector’s penalty assessment.  Eckard Brandes appealed the decision to the circuit court, which reversed.  The circuit court concluded that it was “arbitrary and capricious for the department to vary from the clear statements made in the director’s July 26, 2005 Letter upon which [Eckard Brandes] reasonably relied in calculating its expenses to submit its bids on [] these state contracts. . . the State cannot change the rules after a clear statement like this without notice being given to the employer.”

The Intermediate Court of Appeals affirmed the circuit court’s decision, holding that the 2005 letter was within the then-DLIR director’s power to issue, and that Eckard Brandes reasonably relied on that letter in making calculations for its bid.  Foyt filed an application for writ of certiorari with this court, arguing, among other things, that (1) the then-director’s 2005 letter directly conflicted with Hawai‘i Administrative Rules (HAR) Rule 12-22-1 and that the director should not receive deference, (2) because inspection and cleaning is integral to construction work, it should have been compensated at the higher rate, and (3) cleaning work counts as excavation work under HAR § 12-22-1.