Teamsters Health and Welfare Fund of Philadelphia and Vicinity v. Meco Trucking Co.

          MEMORANDUM OPINION WITH FINDINGS OF FACT AND CONCLUSIONS OF LAW AND ORDER ^[1]

          JOEL SCHNEIDER United State Magistrate Judge.

         This Memorandum Opinion with Findings of Fact and Conclusions of Law serves as the Court's decision with regard to the non-jury trial of this matter. The Court has jurisdiction over this matter pursuant to 29 U.S.C. §§ 185(a), 1132 and 1145, and 28 U.S.C. § 1367. Pursuant to 28 U.S.C. § 636(c), the parties consented to the jurisdiction of this Court to hear this matter. For the reasons to be discussed, the Court will enter Judgment in plaintiffs' favor.^[2]

         FINDINGS OF FACT

         The plaintiffs are Teamsters Health and Welfare Fund of Philadelphia and Vicinity (“Welfare Fund”), Teamsters Pension Trust Fund of Philadelphia and Vicinity (“Pension Fund”), and Adam H. Garner, Administrator.^[3] (Hereinafter the two Funds will be collectively referred to as the “Funds”). Plaintiffs filed this ERISA collection action on December 18, 2014. In brief summary, the Funds are multi-employer Trust Funds that provide pension benefits and medical insurance, among other benefits, to eligible participants who work for contributing employers. Plaintiffs seek to recover from defendant Meco Constructors, Inc. d/b/a Meco Trucking Company (“Meco”) alleged delinquent payments due the Funds for the calendar years 2006-2014, plus interest, liquidated damages and attorney's fees and costs.

         Meco is an employer that provides hauling and construction services in Southeastern Pennsylvania and New Jersey. Meco employs members of Teamsters Local 384. Meco contracted to pay its union employees wages and benefits pursuant to two sets of Collective Bargaining Agreements. The location and type of work an employee performed determined which Agreement applied. First, Meco is a party to a series of Collective Bargaining Agreements with Teamsters Local 384, which is affiliated with the International Brotherhood of Teamsters, Chauffeurs, Warehouseman and Helpers of America. In particular, Meco was a party to the “Material Hauling Agreement” (“MHA”) with Teamsters Local 384 for all time periods relevant to this action. A worker was paid pursuant to the MHA when he/she hauled to or from a work site. These workers did not have to be union members and were not required to be paid prevailing wages. There is no geographic limitation under the MHA. Second, Meco was also a signatory to the FHA with Teamsters Local 384 for all relevant periods to this action.^[4] See JFPTO at &7. The FCA covers work performed in Bucks, Chester, Delaware, Montgomery and Philadelphia Counties. Id. The wage rates in the FCA were designed to be in compliance with prevailing wage requirements.

         Pursuant to the FCA, all work performed in the five-county area was subject to its terms. However, Teamsters Local 384 and Meco agreed on a compromise to permit Meco to compete with nonunion employers. Pursuant to their agreement, Meco only had to pay its workers pursuant to the FCA when he/she worked “exclusively on a construction job site” in the five-county area. See MHA at Article 30. The amount Meco contracted to pay for wages and benefits under the FCA was higher than what was due for work done pursuant to the MHA.

         Under the MHA and the FCA, Meco is obligated to submit monthly contributions to the Funds. The amount of contributions due is determined by the terms of the applicable MHA and FCA, but is generally calculated by multiplying the hours worked by the rate in the Agreements. Meco is obligated to submit contribution reports and payments to the Funds the month following the month in which the work was performed. The contribution reports contain Meco's employees' names, social security numbers, hours worked and the total contributions paid. The Funds provide employee benefits to Meco's employees covered under the Agreements, including but not limited to retirement benefits by the Pension Fund and medical, life and disability benefits by the Welfare Fund. Article VI, Section 6 of the Amended and Restated Agreement and Declaration of Trust of the Teamsters Pension Trust Fund of Philadelphia and Vicinity permits the Pension Fund to conduct payroll audits of contributing employers, including Meco. Section 9(e) of the Agreement and Declaration of Trust of the Teamsters Health and Welfare Fund of Philadelphia and Vicinity permits the Welfare Fund to conduct payroll audits of contributing employers, including Meco.

         Plaintiffs' audits for the year 2006-2014 are at issue in the case. On September 28, 2007, Meco was sent a copy of the audit for 2006. Meco disputed the audit which noted a deficiency. On March 12, 2010, Meco was sent a copy of the audit for 2006 to 2009. The audit noted another deficiency which Meco disputes. On December 18, 2014, plaintiffs filed their complaint against Meco seeking payment of contributions based upon the audit results for the period from January 1, 2006 to December 31, 2009. As part of discovery, an audit was conducted for the period from January 1, 2010 to December 31, 2014. The audit reflected another deficiency that Meco disputed.^[5] The parties' primary dispute for the time period of January 1, 2006 to December 31, 2014, relates to whether the “cap” on hours to be paid under the MHA applies to work performed under the FCA. The parties' second dispute involves the trigger date for the statute of limitations that applies to plaintiffs' claim.

         The first main issue to be decided involves the interpretation of the parties' Agreements. As to the MHA, Article 28, Section A (effective 8/1/2003 to 7/31/2006) states:

The Employer will contribute to the Teamsters Health & Welfare fund the sum of Four dollars, fifty four and three quarters ($4.5475) dollars for each hour worked by a covered Employee up to the maximum of eight (8) hours per calendar day, or ten (10) hours per calendar day for employees assigned to work a ten hour day, forty (40) hours per calendar week and one hundred sixty (160) hours per calendar month.

         Each successive MHA has similar language in Article 28, with the exception of the hourly rate. Article 29 of the MHA (effective 8/1/2003 to 7/31/2006) states:

The Employer will contribute to the Teamsters Pension Fund the sum of Three dollars and three quarters of a cent ($3.075) for each hour worked by a covered Employee up to the maximum of eight (8) hours per calendar day, or ten (10) hours per calendar day for employees assigned to work a ten hour day, forty (40) hours per calendar week and one hundred sixty (160) hours per calendar month[.]

         Each successive MHA has similar language in Article 29, with the exception of the hourly rate. As is apparent, the MHA has a cap on the contributions to be paid to the Funds.

         As to the FCA, Article VII (effective May 1, 2004 to April 30, 2007) states:

Section 7.1 For the period beginning May 1, 2004 to April 30, 2005, each Employer shall pay weekly into the Teamsters' Health, Welfare and Insurance Fund, the sum of Four Dollars and Ninety Cents ($4.90) per hour for each hour for which payment has been made to each chauffeur or helper employed by such Employer, including overtime hours. Effective May 1, 2005 ($1.35) to be apportioned among Wages, Welfare and Pension. Effective May 1, 2006 ($1.35) to be apportioned among Wages, Welfare and Pension.

         Each successive FCA has similar language in Article VII, with the exception of the hourly rate. Article VIII of the FCA ...