O. G. Sansone Co. v. Department of Transportation

Opinion

Plaintiffs O. G. Sansone Co. and Robert E. Fulton Co., as joint venturers, were prime contractors for defendant Department of Transportation on a federally funded public works project for the construction of 17.4 miles of Interstate Highway 5 in Kings County, California. After plaintiffs’ work on the project had been accepted as complete, defendant withheld from the amount earned by plaintiffs the sum of $29,578.65 on the ground that there had been violations of both state and federal laws relating to the payment of prevailing wages on a public works construction project. Thereafter plaintiffs brought this action seeking declaratory relief with respect to the constitutionality of Labor Code sections 1726, 1727 and 1775 and the Work Hours Standards and Safety Act of 1962 and with respect to the applicability of those statutes under the circumstances of this case. Plaintiffs also sought release of the sum withheld from them by defendant.

At the trial the case was submitted by plaintiffs and defendant on the “facts established by the pleadings, Answers to Interrogatories, response to Request for Admissions, and stipulation of the parties,” as well as certain other evidence which was documentary in nature. The court made findings óf fact and conclusions of law and rendered its judgment in favor of defendant.

Plaintiffs subcontracted pay item 18 under the contract which called for “incorporation of approximately 126,000 cubic yards of Class 3 aggregate subbase into the construction project.” On June 23, 1971, plaintiffs requested “that the State approve an intention to subcontract 33 percent of pay item 18 to L. D. Folsom, Inc., of Coalinga, California, that work being loading, placing, and compacting of the material, and 41 percent of pay item 18, involving hauling only, to Wright Brothers Transportation of Visalia, California.” The state approved the request as to a subcontract with Wright Brothers on July 21, 1971.

Plaintiffs entered into an agreement, designated as a subcontract, with Buddy Wright, an individual doing business as Wright Brothers Transportation, which incorporated the provisions of the prime contract and directed the attention of the subcontractor to section 7 of the State Highway Contract Special Provisions entitled “Federal Requirements for Federal Aid Construction Projects.”

Wright Brothers Transportation (hereinafter designated as “Wright”) subcontracted a portion of its work to John W. Heck Trucking, Inc. (hereinafter designated as “Heck”). The court found that “there was no privity of contract between plaintiffs and Heck, and Heck was never specifically requested as a subcontractor nor approved by the State . . . but did function as a second-tier subcontractor to Wright.” At all times herein involved Wright and Heck were “independent truckers serving the general public” and at no time were they licensed as contractors by the State of California.

Wright and Heck hauled .“Class 3 aggregate subbase materials from locations not on the project site, but located adjacent to and established exclusively to serve the project site pursuant to private borrow agreements between plaintiffs and third parties.”

The court found that from June 21, 1971, through July 14, 1971, and from September 8, 1971, through October 19, 1971, and on November

As a result of the wage underpayments and violations of both state and federal prevailing wage laws, the state withheld the sum of $29,578.65 from money earned by plaintiffs. The state determined that the underpayment of wage and fringe benefits with respect to the employees of Wright and Heck and the penalties resulting therefrom were as follows:

“ Wage and

Fringe State Federal

Benefits Penalties Penalties

Wright Brothers Transportation $8,102.45 $9,850.00 $1,470.00

John W. Heck Trucking, Inc. $4,677.96 $9,850.00 $1.340.Q0”

The court further found: “Plaintiffs were not given prior notice, apart from the language of the controlling State and Federal statutes and the terms of the contract documents, that defendants would withhold amounts earned by plaintiffs for work performed on the project by reason of the specific alleged failure of Wright and Heck to pay prevailing wages. [H] . . . There was no hearing conducted by defendant, either prior to or subsequent to the withholding of amounts earned by plaintiffs for work performed on the project here involved by reason of the failure of Wright and Heck to pay the contract minimum prevailing wage rates.”

Plaintiffs filed a claim with the State Board of Control which was denied. Thereafter this action was timely commenced.

At the times pertinent herein Labor Code section 1771 provided as follows: “Not less than the general prevailing rate of per diem wages for work of a similar character in the locality in which the public work is performed, and not less than the general prevailing rate of per diem wages for holiday and overtime work fixed as provided in this chapter, shall be paid to all workmen employed on public works exclusive of maintenance work.” Labor Code section 1772 was as follows: “Workmen employed by contractors or subcontractors in the execution of any contract for public work are deemed to be employed upon public work.” Labor Code section 1774 provided: “The contractor to whom the contract is awarded, and any subcontractor under him, shall pay not less than the specified prevailing rates of wages to all workmen employed in the execution of the contract.”

Plaintiffs contend that the California and federal statutes relating to payment of prevailing wages on public works projects apply only to wages paid by either the contractor or a subcontractor and that Wright and Heck were not subcontractors within the meaning of the state and federal prevailing wage statutes.

We have found no California cases discussing who is and who is not a subcontractor under the state’s prevailing wage laws. In contending that Wright and Heck were not subcontractors under the circumstances of this case, plaintiffs rely on cases dealing with the definition of a subcontractor under the mechanic’s lien law. (Theisen v. County of Los Angeles, 54 Cal.2d 170 , 183 [ 5 Cal.Rptr. 161 , 352 P.2d 529 ]; HihnHammond Lumber Co. v. Elsom, 171 Cal. 570 , 574-575 [ 154 P. 12 ]; George F. Kennedy, Inc. v. Miles & Sons Constr. Division, 5 Cal.App.3d 516 , 520 [ 85 Cal.Rptr. 298 ].) In Theisen a subcontractor is defined as follows (54 Cal.2d at p. 183): “. . . one who agrees with the prime contractor to perform a substantial specified portion of the work of construction which is the subject of the general contract in accord with the plans and specifications by which the prime contractor is bound has ‘charge of construction’ of that part of the work of improvement (Code Civ. Proc., § 1182, subd. (c)) and is a subcontractor although he does not undertake to himself incorporate such portion of the projected structure into the building.”

In Zachry the court held that Glover was not a subcontractor, stating (344 F.2d at pp. 360-361): “The suppliers from which the material for the contracts in suit were obtained were in the business of selling such materials to the general public and were not established specifically to furnish materials for plaintiff’s contracts. Glover was and is an indepen

In the case presently before this court the subbase materials were not obtained from an established independent material supplier. Rather, as stipulated by the parties: “28. The subbase materials hauled by Wright Bros. Transportation and John W. Heck Trucking, Inc. were not furnished to plaintiffs by the State of California; the subbase materials were acquired by plaintiffs from third parties pursuant to private borrow agreements. [18] [If] 29. The subbase materials hauled by Wright Bros. Transportation and John W. Heck Trucking, Inc. were taken from locations adjacent to and established exclusively to serve the project site, though not located physically on the project site, and were delivered by the said firms to the project site. [18]”

The parties further stipulated as follows: “30. The subbase materials hauled by Wright Bros. Transportation and John W. Heck Trucking, Inc. were used by plaintiffs in the performance of work item 18 of the prime contract identified as: Class 3 Aggregate Subbase.”

In section 25-1.01 of the Standard Specifications the work to be performed under work item 18 of the prime contract was described as follows: “This work shall consist offurnishing, spreading and compacting aggregate subbases as specified in these specifications and the special provisions.” (Italics added.) Plaintiffs did not furnish the subbase materials by securing them through a standard commercial supplier. Instead plaintiffs acquired the materials “from third parties pursuant to private borrow agreements.” In performance of plaintiffs’ agreement to furnish these subbase materials under the prime contract, plaintiffs subcontracted the hauling of the materials from the locations “adjacent to and established exclusively to serve the project site.”

In Green v. Jones, 23 Wis.2d 551 [ 128 N.W.2d 1 ], the court sought to determine whether employees of a trucking firm were covered under Wisconsin’s legislation which provided for the payment of wages at the prevailing rate for the area to employees of the contractor or of any subcontractor on a highway construction project. W.

In the course of determining wheth'er Jones’ employees were covered under the state’s prevailing wage law the court made reference to an opinion of the Wisconsin Attorney General (38 Ops.Wis.Atty.Gen. 481, 483) which the court treated as embodying authoritative internal legislative history of the statute. The court stated (128 N.W.2d at p. 6): “In response to specific questions the opinion elaborated the coverage tests. If certain materials were stockpiled at the site, then coverage depended upon whether the materials were hauled from a commercial pit operating continuously, in which event there would be no coverage, or whether the materials were hauled from a pit opened solely for the purpose of supplying materials, in which event there would be coverage. [Fn. omitted.] However, if the materials hauled were immediately utilized on the improvement, the drivers were covered regardless of the source of the material.’’

The Wisconsin court decided that Jones’ employees were covered because under the facts of that case the materials hauled were dumped or spread directly on the roadbed and were immediately used in the construction of the project. Thus, the court stated (128 N.W.2d at p. 7): “In the instant case, although the drivers hauled materials from both commercial and ‘adhoc’ pits, such materials were immediately distributed over the surface of the roadway. The drivers’ tasks were functionally related to the process of construction. The crushed base for the first layer of the highway above the ground was dumped or spread by the drivers and immediately leveled by graders under the supervision of the general contractor. The crushed base and granulated sub-base for shoulder material was dumped on the highway and immediately pushed onto the shoulder and leveled by the general contractor’s graders. The aggregate, utilized as filler in the concrete, was dumped adjacent to a ready-mix concrete set up. The aggregate was immediately mixed with cement, and the concrete was then immediately laid upon the highway strip. [Fn. omitted.] [1|] Clearly, the materials were applied to the process of highway improvement, almost immediately after the drivers arrived at the site. The delivery of materials was an integrated aspect of the ‘flow’ process of construction. The materials were ‘distributed over the surface of the roadway’ with no ‘rehandling’ out of the flow of construction. The

In the case presently before this court plaintiffs, contracted to furnish the subbase material. In order to fulfill the contract, plaintiffs entered into private borrow agreements with third parties so as to obtain borrow sites designed to supply the project site exclusively with subbase materials and plaintiffs contracted with Wright to haul the material to the adjacent project site. Wright and Heck were not materialmen or employees of materialmen. Rather, plaintiffs contracted with Wright to perform an integral part of plaintiffs’ obligation under the prime contract. The trial court properly determined that under the circumstances of the instant case Wright and Heck were subcontractors.

The Due Process Issue

Plaintiffs contend as follows: “No person may be deprived of his property without prior notice of proceedings held for such purpose and an opportunity to be heard therein. Such notice and an opportunity to be heard must be provided by the statute itself. Defendant has withheld funds admittedly earned by plaintiffs to pay additional wages to employees of subcontractors and to satisfy penalties and forfeitures provided by law for violation of the prevailing wage laws. The statutes upon which the State of California relies in this matter provide for the appropriation of plaintiffs’ property to satisfy claims and penalties that are the responsibility of a subcontractor without provision for notice or hearing in violation of the constitutional guarantees of due process of law.”

The statutory scheme which plaintiffs challenge herein provides for a penalty or forfeiture in the event of violations of the prevailing wage provisions. Labor Code section 1775 is in pertinent part as follows: “The contractor shall, as a penalty to the State or political subdivision on whose behalf the contract is made or awarded, forfeit twenty-five dollars ($25) for each calendar day, or portion thereof, for each workman paid less than the stipulated prevailing rates for such work or craft in which such workman is employed for any public work done under the contract by him or by any subcontractor under him. The difference between such stipulated prevailing wage rates and the amount paid to each workman for each calendar day or portion thereof for which each workman was paid less than the stipulated prevailing wage rate shall be paid to each

Labor Code section 1727 provides that “[bjefore making payments to the contractor of money due under a contract for public work, the awarding body shall withhold and retain therefrom all amounts which have been forfeited pursuant to any stipulation in a contract for public work, and the terms of this chapter [which chapter includes the provisions with respect to the payment of prevailing wages]. But no sum shall be withheld, retained or forfeited, except from the final payment, without a full investigation by either the Division of Labor Law Enforcement or by the awarding body.” Labor Code section 1733 provides that suit may be brought “by the contractor or his assignee without permission from the State or other authority and is limited to the recovery of the penalties or forfeitures without prejudice to the contractor’s or assignee’s rights in regard to other matters affecting the contract.”

It is provided in Labor Code section 1729 that“[i]t shall be lawful for any contractor to withhold from any subcontractor under him sufficient sums to cover any penalties withheld from him by the awarding body on account of the subcontractor’s failure to comply with the terms of this chapter, and if payment has already been made to the subcontractor the contractor may recover from him the amount of the penalty or forfeiture in a suit at law.”

Plaintiffs contend that “[t]he right given to the state to withhold funds earned by plaintiffs is, in effect, the right to effect prejudgment attachment.” Plaintiffs rely on recent cases which have held various pretrial provisional remedies to be unconstitutional. (Sniadach v. Family Finance Corp., 395 U.S. 337 [ 23 L.Ed.2d 349 , 89 S.Ct. 1820 ]; McCallop v. Carberry, 1 Cal.3d 903 [ 83 Cal.Rptr. 666 , 464 P.2d 122 ]; and Cline v. Credit Bureau of Santa Clara Valley, 1 Cal.3d 908 [ 83 Cal.Rptr. 669 , 464 P.2d 125 ], wage garnishment; Blair v. Pitchess, 5 Cal.3d 258 [ 96 Cal.Rptr. 42 , 486 P.2d 1242 , 45 A.L.R.3d 1206 ], claim and delivery; Randone v. Appellate Department, 5 Cal.3d 536 [ 96 Cal.Rptr. 709 , 488 P.2d 13 ], prejudgment attachment; Adams v. Department of Motor Vehicles, 11 Cal.3d 146 [ 113 Cal.Rptr. 145 , 520 P.2d 961 , 64 A.L.R.3d 803 ], garageman’s lien.) Such cases are concerned with statutory provisions for .prejudgment seizure or sequestration of a litigant’s property without

In Perkins v. Lukens Steel Co., 310 U.S. 113 [ 84 L.Ed. 1108 , 60 S.Ct. 869 ], the Supreme Court considered the validity of the federal Public Contracts Act of June 1936 which required that sellers who manufacture or furnish materials (in amounts exceeding $10,000) for or to the United States must pay their employees engaged in the manufacture or furnishing of such supplies not less than the prevailing minimum wage. Therein the Supreme Court stated (310 U.S. at p. 127 [84 L.Ed. at pp. 1114-1115]): “Likeprivate individuals and businesses, the Government

However, it is plaintiffs’ contention that under the prevailing wage legislation challenged here plaintiffs are subject to a deprivation of their property without notice or a hearing. . As was said by the United States Supreme Court in Lambert v. California, 355 U.S. 225 , 228 [ 2 L.Ed.2d 228 , 231, 78 S.Ct. 240 ], “[ejngrained in our concept of due process is the requirement of notice. Notice is sometimes essential so that the citizen has the chance to defend charges. Notice is required before property interests are disturbed, before assessments are made, before penalties are assessed. Notice is required in a myriad of situations where a penalty or forfeiture might be suffered for mere failure to act.”

Labor Code section 1775 does provide for the giving of notice to the effect that violations of the prevailing wage law will result in the imposition of certain penalties. Thus it is there provided as follows: “. . . and the body awarding the contract shall cause to be inserted in the contract a stipulation that the provisions of this section [Labor Code section 1775] will be complied with.” The provisions of the section as to which the parties to the contract stipulate there will be compliance are, of course, those provisions relating to the $25 per day forfeiture by the contractor with respect to each workman paid less than the prevailing rate required for work done by the contractor or any subcontractor. The parties are also required to stipulate to those provisions of law relating to payment of wages to workmen representing the difference between prevailing wages and those paid workmen for each day the workmen were paid less than prevailing wages. In the case presently before this court such a stipulation with respect to prevailing wages was entered into by the parties. Thus, in the Standard Specifications section 7-1.01D it is provided in pertinent part as follows: “The Contractor shall comply with Labor Code Section 1775. In accordance with said Section 1775 the Contractor shall forfeit as a penalty to the State of California, $25 for each calendar day or portion thereof, for each workman paid less than the stipulated prevailing rates for such work or craft in which such workman is employed for any work done under the contract by him or by any subcontractor under him in violation of the provisions of the

Furthermore, the trial court found as follows: “The State sent a letter to plaintiffs on December 23, 1971, giving notice that Wright and Heck had failed to pay prevailing wages and fringe benefits to their employees pursuant to the terms of the contract.”

Plaintiffs point out, however, and the trial court found that plaintiffs were not afforded a hearing prior to the imposition of the penalty. In Merco Constr. Engineers, Inc. v. Los Angeles Unified Sch. Dist., supra, 274 Cal.App.2d 154 , the court considered the constitutionality of the penalty provisions of the Subletting and Subcontracting Fair Practices Act (Gov. Code, §§ 4100-4113). The act provided that a contractor must list all proposed subcontractors in his bid and allowed substitutions or deletions of subcontractors only on certain conditions. The act provided the awarding authority various options in penalizing a prime contractor who violated the act. In its discretion the awarding authority could (1) cancel the contract, (2) assess a penalty in an amount no greater than 10 percent of the subcontract involved or (3) both cancel the contract and assess a penalty. The appellate court held the penalty provision of the act (Gov. Code, § 4110) to be unconstitutional as violative of the due process • clause because the statute granted the awarding body great discretion in determining the nature and extent of the penalty to be assessed and failed to give the contractor any opportunity to be heard. Thus the court stated (274 Cal.App.2d at p. 166): “In the case at bar the penalty assessed was the monetary maximum of $77,000. In addition, defendant could have cancelled the prime contract. On the other hand it could have assessed no penalty whatever. The proceeds of the penalty went to defendant. Having in mind the frequent squabbles between contractors and awarding authorities, such a power to be lenient' or stern, assumes rather alarming proportions. That, however, is perhaps a matter of legislative judgment. The aspect of section 4110 which, we are certain, violates basic notions of due process is that all this can be done without notice or hearing. As far as the statute is concerned, all that defendant had to do was to send plaintiff a bill or, easier yet, credit itself with $77,000 in the final accounting. [Fn. omitted.] [1Í] The constitutional requirement for a

That in Merco the appellate court was particularly concerned with the fact that the statute in question gave the awarding authority wide discretion with respect to the nature and extent of the penalty assessed is clear from the court’s discussion of the lack of need for a hearing under the prior law. Thus the court stated (274 Cal.App.2d at p. 168) as follows: “We are particularly persuaded that the Act and especially section 4110 do not contemplate a hearing by the fact that until 1961, former section 4106, the predecessor of section 4110, called for a mandatory penalty of a flat 20 percent. [Fn. omitted.] Of course no hearing is necessary when no discretion is involved and all that needs to be done is to divide a certain figure by 100 and multiply by 20. Apparently, when the law was changed in 1961 and the nature and size of the monetary penalty first became a matter of discretion, no thought was given to the fact that certain constitutional considerations now came into play. ” (Italics added.)

Under the California prevailing wage law the responsible awarding authority has no discretion with respect to the imposition of penalties. It is allowed only to assess $25 per calendar day for each workman paid less than the stipulated prevailing wage. Furthermore, the contractor may challenge the state’s assessment in a legal action, for which provision is made in Labor Code section 1733. In Madonna v. State of California, 151 Cal.App.2d 836 [ 312 P.2d 257 ], a contractor brought suit against the State of California to recover penalties withheld from the final payment due him under a highway construction contract. The appellate court affirmed the trial court’s determination that the contractor’s suit was barred because he failed to bring it within the 90-day period following completion of the contract pursuant to Labor Code sections 1732 and 1733. With respect to certain constitutional arguments raised by the contractor the appellate court stated (151 Cal.App.2d at p. 841): “Since the Legislature has provided in section 1733 for a

Devitt v. Haglin Co., 248 App.Div. 298 [ 289 N.Y.S. 626 ], involved the New York labor law which provided that before the state made payments due on a contract for a public improvement, the state comptroller was to require the contractor and the contractor’s subcontractors to file a certified statement of wages owed to any laborers on account of work performed under the contract. It was further provided that the state might deduct from moneys to be paid the contractor “the sum or sums admitted by any contractor or subcontractor” to be owing for wages in his certified statement and such sum might be withheld for the benefit of the unpaid workmen. In Devitt a subcontractor failed to pay plaintiffs and the subcontractor filed a certified statement admitting this failure. The state comptroller withheld from payments due to the general contractors on the job the amounts owed to plaintiffs. The court concluded that the statutory provisions validly provided for withholding from payments due to the general contractor where the subcontractor failed to pay his employees, stating (289 N.Y.S. at p. 631): “From a reading of the sections, and from the growing tendency of the Legislature to protect laborers on public jobs, and from all the surrounding facts and circumstances, it is apparent that the Legislature intended to assure to all laborers on public work the payment of their wages, no matter whether they were employees of the person with whom the state was doing business directly, or of some subcontractor who was unknown to the state.”

In Devitt the prime contractors argued that the statute so construed deprived them of their property without due process of la,w. The appellate court disagreed, stating (289 N.Y.S. at pp. 631-632): “We are here dealing with an agreement between individual corporations and the state, and the law is well settled that one who undertakes to perform public work for the state must take the contract as the state tenders it, or leave it altogether. Campbell v. City of New York, 244 N.Y. 317 , 155

Under the statutory scheme presently before us, in acting pursuant to Labor Code section 1727 the state did not take property belonging to plaintiffs; rather, it withheld sums pursuant to the terms of its contract with plaintiffs. An involuntary burden was not placed upon plaintiffs by virtue of the legislation reviewed herein. Plaintiffs’ execution of the contract with knowledge of the penalties to be imposed if they or their subcontractors failed to pay the prevailing wages required under the contract was voluntary, and constituted consent to the provisions now challenged. (See Winder Bros. v. Sterling, 118 Tex. 268 [ 12 S.W.2d 127 , 128-129].)

The prevailing wage legislation herein involved provides for notice with respect to the governmental agency’s prevailing wage determination prior to the submission of bids on public works projects. (Lab. Code, § 1773.2.) It also provides a procedure for contesting the agency’s determination. (Lab. Code, § 1773.4.) Thereafter the contractor submits a bid based on the agency’s determination with respect to prevailing wages to be paid, and the contract, subsequently awarded for said public work in accordance with statutory requirements, contains notice of the forfeiture to be made by the contractor if either he or his subcontractor fails to comply with the contractual provisions relating to the payment of prevailing wages. (Lab. Code, § 1775.) The contractor cannot claim that he lacked notice of. or an opportunity to contest, the prevailing wage provision as determined by the agency.

When the contractor submits his bid based on the prevailing wage determination and freely enters into a contract for the public work involved, in which contract he stipulates to be subject to the penalty provisions of the prevailing wage law, he cannot be heard to say that he was denied due process of law with respect to the enforcement of the penalty provisions.

HI

The Equal Protection Issue

Plaintiffs contend as follows: “Legislative classification must rest upon some substantial and intrinsic difference which suggests a reason for and justifies the particular legislation. There is neither authority nor persuasive reasoning for the arbitrary imposition of burdens upon public works contractors. The prevailing wage laws, stripped of their immunity from constitutional limitations, deny public works contractors equal protection of the laws.” Plaintiffs argue that the prevailing wage laws discriminate against public works contractors by requiring them -to pay prevailing wages whereas contractors employed by private persons and entities are not required to pay prevailing wages. Furthermore, plaintiffs complain that the prevailing wage legislation is not applicable to all public works contracts in that the California legislation does not apply to contracts awarded by a charter city or other municipal corporation and, moreover, that the law does not apply to public works construction carried out by a public agency using its own public employees.

In Russell v. Carleson, 36 Cal.App.3d 334 , at page 343 [ 111 Cal.Rptr. 497 ], it was stated: “Directing our attention to the constitutional guarantee of equal protection of the laws, we observe that the latter guarantee ‘compels recognition of the proposition that persons similarly situated with respect to the legitimate purpose of the law receive like treatment.’ (Purdy & Fitzpatrick v. State of California (1969) 71 Cal.2d 566 , 578 [ 79 Cal.Rptr. 77 , 456 P.2d 645 , 38 A.L.R.3d 1194 ].) ‘[T]he Legislature is vested with wide discretion in making the classification and . . . its decision as to what is a sufficient distinction to warrant the classification will not be overthrown by the courts unless it is palpably arbitrary and beyond rational doubt erroneous. [Citations.] . . . Only invidious discrimination offends the equal protection clause [citation]; the Legislature need not treat similar evils identically or legislate as to all phases of a field at once [citation]; legislative classification is permissible when it is based upon some distinction reasonably justifying differentiation in treatment [citations]; a classification is not void because it does not embrace within it every other class which might be included [citation] . . . .’ (People v. Aguiar, supra, 257 Cal.App.2d at p. 604 [ 65 Cal.Rptr. 171 ].) ‘ “A statutory discrimination will not be set aside if any state of facts reasonably may be conceived to justify it.” [Citation.]’ (Dandridge v. Williams (1970) 397 U.S. 471 , 485 [ 25 L.Ed.2d 491 , 502, 90 S.Ct. 1153 ].) (See also Allied Stores of Ohio v. Bowers (1959) 358 U.S. 522 , 527-528 [ 3 L.Ed.2d 480 , 485-486, 79 S.Ct. 437 ]; In re Ricky H., supra, 2 Cal.3d at p. 522 [ 86 Cal.Rptr. 76 , 468 P.2d 204 ].)”

However, as was said in McLaughlin v. Florida, 379 U.S. 184 , 191 [ 13 L.Ed.2d 222 , 228, 85 S.Ct. 283 ]: “Judicial inquiry under the Equal

The differences between public employment and employment by a private contractor noted in City of Monmouth v. Lorenz, supra, 30 Ill.2d 60 [ 195 N.E.2d 661 ], provide a rational basis for the distinctions made between those two types of employment by Labor Code section 1771.

Plaintiffs contend that there is no rational reason for application of prevailing wage laws to public works contracts and not to public contracts in general. Public works are defined in Labor Code section 1720 as follows: “As used in this chapter ‘public works’ means: [11] (a) Construction, alteration, demolition or repair work done under contract and paid for in whole or in part out of public funds, except work done directly by any public utility company pursuant to order of the Public Utilities Commission or other public authority. [U] (b) Work done for irrigation, utility, reclamation and improvement districts, and other districts of this type. ‘Public work’ shall not include the operation of the irrigation or drainage system of any irrigation or reclamation district, except as used in Section 1778 relating to retaining wages. [II] (c) Street, sewer or other improvement work done under the direction and supervision or by the authority of any officer or public body of the state, or of any political subdivision or district thereof, whether such political subdivision or district operates under a freeholder’s charter or not. [II] (d) The laying of carpet done under a building lease-maintenance contract and paid for out of public funds. [H] (e) The laying of carpet in a public building done under contract and paid for in whole or part out of public funds.”

The statutory scheme, the cases decided under the California prevailing wage law and under the Davis-Bacon Act, as well as the legislative history available with respect to the Davis-Bacon Act, show clearly that prevailing wage legislation was designed to benefit the construction worker on public construction projects. The Legislature may constitutionally single out a particular segment of industry for regulation without necessarily running afoul of the equal protection clauses of the state and federal Constitutions. As was said in Brown v. Merlo, 8 Cal.3d 855 , at page 861 [ 106 Cal.Rptr. 388 , 506 P.2d 212 , 66 A.L.R.3d 505 ], the “ ‘equal protection’ preserved by both state and federal Constitutions,... ‘does not preclude the state from drawing any distinctions between different groups of individuals’ {In re King (1970) 3 Cal.3d 226 , 232 [ 90 Cal.Rptr. 15 , 474 P.2d 983 ]), but it does require that, at a minimum, ‘persons similarly situated with respect to the legitimate purpose of the law receive like treatment.’ [Citations.]” There is a natural, intrinsic distinction between public works contracts and other public contracts. The Legislature having ascertained the existence of a situation in the field of construction of public works which called for remedial action could act to remedy that situation without making the legislation applicable to every public contract.

Appellants contend that the California prevailing wage law constitutes a denial of equal protection because it does not apply to public works contracts awarded by charter cities, citing City of Pasadena v. Charleville, 215 Cal. 384 [ 10 P.2d 745 ], and Smith v. City of Riverside, 34 Cal.App.3d 529 , 535 [ 110 Cal.Rptr. 67 ], or to public works projects constructed by a municipal corporation (with its own forces), citing Bishop v. City of San

Finally plaintiffs contend that “[t]he submission of certified payrolls by a subcontractor showing payment of prevailing wages satisfies all obligations of the contractor under the prevailing wage statutes.” As noted hereinabove, Labor Code section 1775 requires the contractor to pay penalties assessed by the state as well as the difference owed to workmen paid less than the prevailing wage. These statutory obligations are imposed on the contractor whether the contractor or a subcontractor failed in his obligation to pay prevailing wages. Thus the statutory scheme requires more of the contractor than procurement of certified payrolls from a subcontractor showing payment of prevailing wages. It must be remembered that a prime contractor subcontracts work on a construction project primarily for his own convenience. The Legislature has expressed its intention that the prevailing wage provisions apply to all workmen on public projects and that the provisions of the act not be frustrated because of the subcontracting of work required to be done under the provisions of the prime contract. It is not unreasonable to require that the contractor assume contractual responsibility for his subcontractor’s compliance with the prevailing wage law.

The legislation in question does not violate either due process or the equal protection of the law. No unconstitutional burdens have been imposed on plaintiffs. No basis for a reversal of the judgment has been shown.

The judgment is affirmed.

Allport, 1. and Potter, 1, concurred.

Appellants’ petition for a hearing by the Supreme Court was denied April 15, 1976.