In an important decision, the Appellate Division Third Department upheld the Department of Labor’s determination that construction work on a volunteer firehouse was public work subject to the mandates of Article 8 of the Labor Law (the “Prevailing Wage Law”).  In MATTER OF M.G.M. INSULATION, INC. v. GARDNER, 2011 NY Slip Op 05996, (July 21, 2011), the Appellate Division held that the Not-For Profit Bath Volunteer Fire Department (“BVFD”) – which received funding from the local village tax revenues – was that BVFD was “the functional equivalent of a municipal department, thus qualifying as a public agency within the meaning of Labor Law § 220, and, further, that the construction of the new fire station constituted a public work project.”  The Court held that contrary to the Fire Department’s arguments, the Court would find it to be a public work project because of numerous factors, specifically:

· that under the Nor-for-Profit corporation law (1402 (b)), the BVFD remained "under the control of the city, village, fire district or town authorities having, by law, control over the prevention or extinguishment of fires therein";

· that the village board controlled bidding process for construction, owned the trucks and furnished the fuel for the trucks;

· that the Village owned the building out of which BVFD previously operated and, through the provision of the underlying service agreements, funded the lion's share of BVFD's operating expenses.

While some municipalities have, rather disingenuously, attempted to evade the law on this subject, this decision provides firm guidance for municipalities and fire departments that the updating and construction of fire house are subject to the prevailing wage law.

Please feel free to contact one of our labor law attorneys for more information on the applicability of the Prevailing Wage Law to similar projects.