Montana Administrative Register Notice 24-17-334 No. 8   04/27/2018    
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                                       OF THE STATE OF MONTANA

In the matter of the amendment of ARM 24.17.127, pertaining to classification of workers for heavy construction services on public works projects






     TO: All Concerned Persons 


            1. On February 9, 2018, the Department of Labor and Industry (department) published MAR Notice No. 24-17-334 regarding the public hearing on the proposed amendment of the above-stated rule, at page 232 of the 2018 Montana Administrative Register, Issue No. 3.


            2. On March 2, 2018, a public hearing was held on the proposed amendment of the above-stated rule in Helena. Members of the public commented on the proposed amendment at the public hearing and also submitted written comment during the rule comment period.


            3. The department has thoroughly considered the comments received. A summary of the comments received, and the department's responses are as follows:


COMMENT 1: Numerous commenters representing pipefitters in various capacities commented that they agreed with the results of the area practice survey and the department's corresponding proposal to classify the work in question as pipefitter. 


RESPONSE 1: The department acknowledges the comments. The work in question that was the focus of the area practice survey only included work performed on heavy construction projects, specifically water and wastewater treatment plants and projects of a similar nature, when the work occurred inside a building structure or was performed at a location which would later be inside of a building. Further, the work in question particularly only included joining steel pipe larger than 12 inches in diameter with bolted flange connections that has been pre-fabricated off site and does not require any modification such as cutting, grinding, welding, or other fabrication in order to be installed.


COMMENT 2: A number of commenters representing pipefitters in various capacities commented that they disagreed with the department's clarification that the work, when it occurs at a location that will always be outside a building, would continue to be classified as laborer/pipelayer. The commenters assert that historically pipefitters have claimed this work and another area practice survey on this issue will show that result. The commenters stated they understand the department's position that the question of work done outside a building was not in dispute.  They further understand the department indicated this issue was not directly addressed by the area practice survey, and that the department did not review any data it received on this question because this work was outside the scope of the survey.  Because the survey did ask a question about inside versus outside work, the commenters note they did submit data on outside work.  Since the question of outside work was not a focus of the survey, the commenters believe the clarification regarding the laborer classification on this work should not be included in the department's proposal.  The commenters request another area practice survey on this question alone in order to address outside work.


RESPONSE 2: The department responds that the dispute involved work that was performed outside but would later be inside a building. The clearest way to distinguish that work was to clarify the difference between work outside versus work outside that would later be inside a building. Therefore, although the survey asked about outside work, it was only to obtain and determine proper survey responses regarding the disputed work. The definition of laborer/pipelayer includes this work when it is outside a building, hence the dispute. The department notes that neither the survey nor the proposed rule address work that involves fabrication of pipe outside. Because the work outside a building was not in dispute and because the work falls within the definition of laborer, the department declines to conduct another area practice survey at this time. The department will continue to monitor the issue in the future. The department is adopting the proposed rule with the clarification as set out in the proposal notice.


COMMENT 3: A commenter stated their position that the joining of prefabricated steel pipe larger than 12 inches in diameter with bolted flange connections should be classified as laborer/pipelayer work, regardless of where that pipe is located.  The commenter stated that the department should change its proposal classifying it as pipefitter work and should instead classify it as laborer/pipelayer work. 


RESPONSE 3: The department acknowledges the comment, but disagrees because the area practice survey results demonstrated the prevailing classification occurring in Montana for this type of work is pipefitter. Therefore, the department will not change its proposal and is adopting the classification proposed.


COMMENT 4: One commenter stated that the way the department set out the classification change in the publication was confusing because the entire change was put under "S," but only part of the clarification was put under the pipefitter definition, and nothing was put under the laborer definition. The commenter suggested putting the entire change under "S" and then cross-referencing the change under both pipefitters and laborers. 


RESPONSE 4: The department agrees and has changed the final publication accordingly.


COMMENT 5: One commenter stated that if the survey data showed differences in what classifications prevailed in the eastern versus western side of the state, that the department should create separate districts. 


RESPONSE 5: The department disagrees. Legislation enacted in recent legislative sessions has directed the department to use fewer districts, for prevailing wage purposes, rather than break the state into more districts. Further, for heavy construction, there is not a clear distinction so the department will continue to classify heavy construction statewide.


COMMENT 6: One commenter stated they believed the reporting of pipefitter apprentices in the data could unfairly affect the data results because an apprentice is not fully trained and can be paid less. The commenter stated that if the majority of reported workers are pipefitter apprentices rather than pipefitters, that laborers/pipelayers could possibly do the same work, so the survey would not properly show what is the prevailing classification. 


RESPONSE 6: The department disagrees. For purposes of determining the prevailing classification, apprentices are properly included. If apprentices are used in an industry and that is what is prevailing in the industry, then the correct classification is still that classification because that is what is prevailing in the industry. Further, the area practice survey results collected in this case are not overly weighted by apprentices. Very few of the projects used apprentices. If three-fourths of the pipefitter workers were removed from the data, the pipefitter classification would still prevail over the laborer/pipelayer classification as prevailing in the industry. 


            4. The department has amended ARM 24.17.127 as proposed.




Mark Cadwallader

Alternate Rule Reviewer


Galen Hollenbaugh, Commissioner



            Certified to the Secretary of State April 17, 2018.

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