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Sheet Metal Workers Intern. Ass'n, Local Union No. 19 v. U.S. Dept. of Veterans Affairs

February 09, 1998

SHEET METAL WORKERS INTERNATIONAL ASSOCIATION, LOCAL UNION NO. 19
v.
UNITED STATES DEPARTMENT OF VETERANS AFFAIRS, APPELLANT



On Appeal from the United States District Court for the Eastern District of Pennsylvania (D.C. Civil Action No. 96-cv-04120) Argued November 18, 1997

Before: Scirica and Lewis, Circuit Judges and Ackerman, District Judge*fn*

The opinion of the court was delivered by: Scirica, Circuit Judge.

(Filed February 9, 1998)

OPINION OF THE COURT

This case involves an interpretation of the Freedom of Information Act, 5 U.S.C.A. § 552 (West 1996 & Supp. 1997). The issue on appeal is the continuing vitality of our opinion in International Bhd. of Elec. Workers Local Union No. 5 v. United States Dep't of Hous. and Urban Dev. , 852 F.2d 87 (3d Cir. 1988) ("IBEW"). In IBEW, we held the Freedom of Information Act's § 552(b)(6) privacy exemption could not prevent disclosure of certain wage related information which the union used to measure compliance with the Davis-Bacon Act, 40 U.S.C.A. §§ 276a-276a-7 (West 1986 & Supp. 1997). The specific issue here requires us to once again balance the public interest served by disclosure against the harm resulting from the invasion of privacy in light of intervening decisions from the Supreme Court.

I.

A.

Plaintiff-appellee, the Sheet Metal Workers' International Association, Local Union No. 19, monitors "whether federal agencies are enforcing private contractors' compliance with [the Davis-Bacon Act]." Sheet Metal Workers' Int'l Ass'n Local Union No. 19 v. United States Dep't of Veterans Affairs, No. 96-4120, 1997 WL 34681, at *1 (E.D. Pa. Jan. 28, 1997). "The Davis-Bacon Act requires that the wages of work on a Government construction project shall be `not less' than the `minimum wages' specified in a schedule furnished by the Secretary of Labor." United States v. Binghamton Const. Co., 347 U.S. 171, 172, reh'g denied, 347 U.S. 940 (1954). Essentially, it provides "that all laborers and mechanics working on federally funded construction projects be paid not less than the prevailing wage in the locality in which the work is performed." IBEW, 852 F.2d at 88.

"The Davis-Bacon Act is enforced in part through the Copeland Act, 40 U.S.C. § 276c, which requires federal contractors to submit weekly payrolls to the government." Id. The Copeland Act authorizes the Secretary of Labor to make "reasonable regulations for contractors and subcontractors engaged in the construction, prosecution, completion or repair of public buildings . . . including a provision that each contractor and subcontractor shall furnish weekly a statement with respect to wages paid each employee during the preceding week." 40 U.S.C.A. § 276c (West 1986).

Contractors' payrolls must contain: "the name, address, and Social Security number of each such worker, his or her correct classification, hourly rates of wages paid (including rates of contributions or costs anticipated for bonafide fringe benefits or cash equivalents thereof . . . ), daily and weekly number of hours worked, deductions made and actual wages paid." 26 C.F.R. § 5.5(a)(3)(I) (1997). The public agency hiring the contractor must ensure compliance with these regulations. See 26 C.F.R. § 5.6(a)(3) ("The federal agency shall cause such investigations to be made as may be necessary to assure compliance with the labor standards clauses required by § 5.5 and the applicable statutes listed in § 5.1").

The union contends it uses this information (1) to ascertain whether the contractor is inflating the numbers of employees actually working on the job site; (2) to compare the employees' listed job classifications with the work actually performed on the job site; (3) to determine whether the contractor is using the same employee for two different classifications on the same job; (4) to check the consistency over time of the rate of pay for a particular classification; (5) to determine whether the employer is using the proper ratio of mechanics to journeymen apprentices; and (6) to determine if the apprentices are properly registered with the State Director of Apprenticeship and Training, whether they are working out of their classification, and whether they are receiving the proper rate of pay. (See App. at 50-52 (Clagg Aff. ¶¶ 10-12)).

B.

Boro Developers, Inc. is a construction company who contracted with defendant-appellant, the United States Department of Veterans Affairs. The Department of Veterans Affairs hired Boro to assist in the renovation of the Veterans Administration hospital in Wilmington, Delaware.

On January 16, 1996, the union requested from the Department of Veterans Affairs (1) copies of the certified payrolls Boro submitted for the hospital renovation, (2) copies of apprentice registration forms, and (3) "the applicable Prevailing Wage determination established by the Department of Labor" for the hospital renovation. (App. at 8 (Compl. Ex. A)).*fn1 By letter dated February 20, 1996, the Department of Veterans Affairs responded to the union's request: "Due to privacy act considerations, names, Social Security numbers, fringe benefits, etc. be redacted." (App. at 11 (Compl. Ex. B)).

The union renewed its request on March 6, 1996. (See App. at 13 (Compl. Ex. C)). A formal appeal was filed on March 20, 1996 through counsel, reiterating the union's demand: "the [Department of Veterans Affairs] is entitled under the FOIA only to redact Social Security numbers . . . . All other information . . . including employees' names, addresses, job classifications and pay rates, must be provided in full." (App. at 16-17 (Compl. Ex. D)).

On May 3, 1996, the Department of Veterans Affairs issued its final denial, relying primarily on §§ 552(b)(6) and 552(b)(7)(C) of the Freedom of Information Act:

Some of the information contained on the records you seek is personal in nature [§ 552(b)(6)], and the records themselves are considered to be law enforcement records [§ 552(b)(7)(C)]. The personal information in the requested records includes the record subjects' names and Social Security numbers, their home addresses, sex and racial status, together with a breakout of their payroll withholdings and net pay. As records containing such personal information, these records fall within the scope of records that are subject to the aforementioned exemptions.

the wages paid for work performed, the rates and job classifications of the payees should be available to the public.

please understand that individual identifiers, such as names, and Social Security numbers, addresses, sex, race, payroll withholdings and net pay, will be redacted.

(App. at 40-41(Compl. Ex. E)).

C.

On June 3, 1996, the union filed a complaint in the United States District Court for the Eastern District of Pennsylvania seeking disclosure under the Freedom of Information Act. (See App. at 4-5 (Compl.¶ 13)). The complaint requested, inter alia, (1) that the court order the Department of Veterans Affairs to provide the requested documents; (2) that, in the alternative, the Department of Veterans Affairs furnish the court with the records for an in camera inspection to determine if any exemptions apply; and (3) that the court enter a declaratory judgment that the Department of Veterans Affairs cannot rely on § 552(b)(6) as authority for withholding the requested information. (App. at 5-6 (Compl. Wherefore Cl.)).

The Department of Veterans Affairs moved for summary judgment, arguing §§ 552(b)(6) and 552(b)(7)(C) prohibit the disclosure of the requested information. The unionfiled a cross-motion for summary judgment. The district court granted the union's cross-motion for summary judgment and denied the Department of Veterans Affairs's motion.

The able district Judge described his task as follows: "to balance the privacy interest of the Boro employees in nondisclosure of the payroll information against`the extent to which disclosure would shed light on an agency's performance of its statutory duties or otherwise let citizens know what their government is up to.' " Sheet Metal Workers', Local No. 19, 1997 WL 34681, at *4 (citation omitted). Relying largely on our well reasoned opinion in IBEW, the district court nonetheless recognized a string of recent appellate decisions which questioned the rationale of that decision:*fn2

These cases, of course, cannot overrule IBEW. Only the Supreme Court and the Third Circuit can overrule that case, and neither court has done so expressly. The position taken by the Second, Ninth, Tenth, and District of Columbia circuits cannot bind this court.

The court recognizes that the case law in this area is evolving as a result of Supreme Court decisions, and that Courts of Appeals have taken a closer look at employees' privacy interests in light of the Supreme Court's Discussion of the issue. This court, however, is bound by the rulings of the Third Circuit until that court changes its position or its decisions are overruled by the Supreme Court. The court concludes that the IBEW decision controls this case, has not been overruled, and continues to be the law in this circuit.

The fact that the court has concluded that it is bound by the rule set forth in IBEW does not mean that the court agrees with the Third Circuit's balancing of interests in that case, especially as it relates to disclosure of the employees' names and home addresses. The court finds considerable merit in the position taken by the Second, Ninth, Tenth, and District of Columbia circuits and suggests that the Third Circuit consider using the facts of this case to re-examine IBEW in light of these decisions.

Sheet Metal Workers', Local No. 19, 1997 WL 34681, at *6 & n.1 (citations omitted). The Department of Veterans Affairs appealed.

II.

Generally, we apply a two-tiered test when reviewing an order granting summary judgment in proceedings seeking disclosure under the Freedom of Information Act:

The reviewing court must first decide whether the district court had an adequate factual basis for its determination.

t must then decide whether that determination was clearly erroneous. Under the clearly erroneous standard, this Court may reverse only if the findings are unsupported by substantial evidence, lack adequate evidentiary support in the record, are against the clear weight of the evidence or where the district court has misapprehended the weight of the evidence. The two tiered standard of review of the district court's determination that a particular document is or is not properly subject to exemption does not, of course, preclude plenary review of issues of law.

McDonnell v. United States, 4 F.3d 1227, 1242 (3d Cir. 1993) (citations omitted).*fn3 In this case, however, the district court based its grant of summary judgment on our ruling in International Bhd. of Elec. Workers Local Union No. 5 v. United States Dep't of Hous. and Urban Dev., 852 F.2d 87 (3d Cir. 1988). In that event, we exercise plenary review. McDonnell, 4 F.3d at 1242.

III.

A.

"The Freedom of Information Act was enacted to facilitate public access to Government documents." Sheet Metal Workers Int'l Assoc. Local No. 9 v. United States Air Force, 63 F.3d 994, 996 (10th Cir. 1995). See also Hopkins v. United States Dep't of Housing and Urban Dev., 929 F.2d 81, 83 (2d Cir. 1991) (the Freedom of Information Act "was enacted in 1966 to create a broad right of access to official information") (citation omitted). There is a presumption in favor of disclosure, and "FOIA expressly places the burden `on the agency to sustain its action.' " United States Dep't of justice et al. v. Reporters Committee for Freedom of the Press, et al., 489 U.S. 749, 755 (1988) (citations omitted). See also United States Dep't of Defense et al. v. Federal Labor Relations Auth., 510 U.S. 487, 494 (1994) ("disclosure, not secrecy, is the dominant objective of FOIA") (citation omitted).

"Public access to government information is not, however, `all encompassing.' " Sheet Metal Workers', Local No. 9, 63 F.3d at 996 (citation omitted). The act "reflects a general philosophy of full agency disclosure unless information is exempted under clearly delineated ...


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