APPRENTICESHIPS ‑- STATE APPRENTICESHIP COUNCIL ‑- DEPARTMENT OF LABOR AND INDUSTRIES ‑- ADMINISTRATIVE PROCEDURES ACT

APPRENTICESHIPS ‑- STATE APPRENTICESHIP COUNCIL ‑- DEPARTMENT OF LABOR AND INDUSTRIES ‑- ADMINISTRATIVE PROCEDURES ACT 

1.         The State Apprenticeship Council is an "agency" within the meaning of chapter 34.04 RCW and chapter 34.05 RCW, the old and new Administrative Procedures Acts. 

2.         The State Apprenticeship Council is required to promulgate its standards for approving apprenticeship agreements as rules under the Administrative Procedures Act. 

3.         Disapproval by the State Apprenticeship Council of an apprenticeship agreement would not ordinarily give rise to a "contested case" or "adjudicative proceeding" under the Administrative Procedures Act, but might do so in some cases depending on the facts. 

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                                                                   June 27, 1989 

The Honorable James E. West
State Senator, 6th District
P.O. Box 2792
Spokane, WA 99220-0792 

Cite as:  AGO 1989 No. 12                                                                                                                

 Dear Senator West:

             By letter previously acknowledged, you have requested our opinion on the following questions:

             1.         Is the State Apprenticeship Council an "agency" within the meaning of chapter 34.04 RCW, the state administrative procedure act?

             2.         Is the State Apprenticeship Council required to promulgate its standards for approving apprenticeship agreements as rules as defined in the administrative procedure act?

             3.         If the State Apprenticeship Council does not approve an apprenticeship agreement, is it required to specify its reasons for denial?

              [[Orig. Op. Page 2]]

             4.         If the State Apprenticeship Council does not approve an apprenticeship agreement, is the decision appealable before an administrative law judge of the Office of Administrative Hearings?  What are the subsequent appeal procedures?

             We answer your first two questions in the qualified affirmative and your third and fourth questions in the negative, as explained in the analysis below.

                                                                      ANALYSIS

Question 1

             Is the State Apprenticeship Council an "agency" within the meaning of chapter 34.04 RCW, the state administrative procedure act?

             RCW 34.04.010(1) defines "agency" as "any state board, commission, department, or officer, authorized by law to make rules or to adjudicate contested cases, except those in the legislative or judicial branches."  The Apprenticeship Council is created pursuant to RCW 49.04.010.  It consists of six members appointed by the Director of Labor and Industries and one member appointed by the Governor (in addition to certain officers serving ex-officio).  The statute provides that the Council shall:

             (1) Establish standards for apprenticeship agreements in conformity with the provisions of this chapter; (2) issue such rules and regulations as may be necessary to carry out the intent and purposes of this chapter, including a procedure to resolve an impasse should a tie vote of the council occur; and (3) perform such other duties as are hereinafter imposed.

 RCW 49.04.010.  The remainder of chapter 49.04 RCW pertains to the establishment of apprenticeship programs in various vocations and industries, administered by the Department of Labor and Industries under the general supervision of the Apprenticeship Council.

             The Apprenticeship Council obviously has been created as an agency with statewide (not merely local) jurisdiction.  The Council has explicit authority to issue rules and regulations, in addition to authority to establish standards for apprenticeship agreements.  As we discuss more fully in our answer to question 2, we are satisfied that this authority mounts to the power to "make rules" and therefore makes the Apprenticeship Council an "agency" for purposes of the administrative procedure act,  [[Orig. Op. Page 3]] chapter 34.04 RCW.1/

            By the plain language of the statute then, we reach an affirmative answer to your first question.

 Question 2

             Is the State Apprenticeship Council required to promulgate its standards for approving apprenticeship agreements as rules as defined in the administrative procedure act?

             RCW 34.04.010(2) defines "rule" as follows:

             "Rule" means any agency order, directive, or regulation of general applicability (a) the violation of which subjects a person to a penalty or administrative sanction; (b) which establishes, alters, or revokes any procedure, practice, or requirement relating to agency hearings; (c) which establishes, alters, or revokes any qualification or requirement relating to the enjoyment of benefits or privileges conferred by law; (d) which establishes, alters, or revokes any qualifications or standards for the issuance, suspension, or revocation of licenses to pursue any commercial activity, trade, or profession; or (e) which establishes, alters, or revokes any mandatory standards for any product or material which must be met before distribution or sale.  The term includes the amendment or repeal of a prior rule, but does not include (i) statements concerning only the internal management of an agency and not affecting private rights or procedures available to the public, (ii) declaratory rulings issued pursuant to RCW 34.04.080, as now or hereafter amended, or (iii) traffic restrictions for motor vehicles, bicyclists, and pedestrians established by the secretary of transportation or his designee where notice of such restrictions is given by official traffic control devices.

 If agency standards or directives meet this statutory definition of "rule", then they may be unenforceable if not adopted in substantial compliance with the administrative procedure act.  See RCW 34.04.025(5).

              [[Orig. Op. Page 4]]

             We are satisfied that the standards for apprenticeship agreements established by the Apprenticeship Council are "rules" as defined in RCW 34.04.010(2).  These standards are directives of general applicability, and they arguably establish qualifications or requirements relating to the enjoyment of benefits or privileges conferred by law.  Under the statutory scheme, a trade or group of trades can establish an apprenticeship committee that, in turn, can devise standards for apprenticeship agreements in the trade subject to the approval of the Council.  RCW 49.04.040.2/

             Approval of such apprenticeship committee standards by the Council is associated with an important collateral privilege.  On state and local public works projects, skilled labor must be paid the prevailing journeyman wage.  Apprentices in approved programs, however, can be paid less than prevailing journeyman rates, but must be paid at least the prevailing rate for apprentices in that trade.  RCW 39.12.021.  Thus, contractors who employ apprentices from approved programs can pay such apprentices prevailing apprentice wages, rather than the more costly journeyman wages, on public works projects.

             We thus conclude that apprenticeship agreement standards promulgated by the Apprenticeship Council probably are "rules" subject to the administrative procedure act.  The Council apparently agrees with this conclusion because it has adopted these standards pursuant to the administrative procedure act.  See WAC 296-04-270(2), [296-04]-275.  We answer your second question in the affirmative.

 Question 3

             If the State Apprenticeship Council does not approve an apprenticeship agreement, is it required to specify its reason for denial?

 Question 4

             If the State Apprenticeship Council does not approve an apprenticeship agreement, is the decision appealable before an administrative law judge of the Office of  [[Orig. Op. Page 5]] Administrative Hearings?  What are the subsequent appeal procedures?

            In posing these two questions, you seem to be asking whether the disapproval of an apprenticeship agreement by the Apprenticeship Council either is a "contested case" within the meaning of the administrative procedure act, RCW 34.04.010(3), or could give rise to such a "contested case".  We conclude that the disapproval of an apprenticeship agreement probably does not give rise to a contested case.3/

              Your final two questions assume that the Apprenticeship Council finally approves apprenticeship agreements.  The relative functions of the Apprenticeship Council and the Supervisor of Apprenticeship (an assistant director of the Department of Labor and Industries) are set forth in RCW 49.04.010 and RCW 49.04.030 and are discussed in some length in AGO 1947-49 No. 570 (copy attached).  See also WAC 296-04-005.  As clarified in that earlier opinion, the Apprenticeship Council approves agreements proposed by local or state joint apprenticeship committees in particular trades or groups of trades.  RCW 49.04.040.  The term "apprenticeship agreement" is defined in RCW 49.04.060 as:

                         (1) An individual written agreement between an employer and apprentice, or (2) a written agreement between an employer, or an association of employers, and an organization of employees describing conditions of employment for apprentices, or (3) a written statement describing conditions of employment for apprentices in a plant where there is no bona fide employee organization.

             This statute provides that an apprenticeship agreement can take several forms, ranging from an individual employer-employee agreement to an agreement between a group of employers and a group of employees covering an entire trade.

             RCW 34.04.010(3) provides:

                         "Contested case" means a proceeding before an agency in which an opportunity for a hearing before  [[Orig. Op. Page 6]] such agency is required by law or constitutional right prior or subsequent to the determination by the agency of the legal rights, duties, or privileges of specific parties.  Contested cases shall also include all cases of licensing and rate making in which an application for a license or rate change is denied except as limited by RCW 66.08.150, or a license is revoked, suspended, or modified, or in which the granting of an application is contested by a person having standing to contest under the law or agency rules.

 The disapproval of an apprenticeship agreement is not a denial of a license within the meaning of this definition because, as explained in footnote 2, supra, it is not unlawful to operate an unapproved apprenticeship program.  Therefore, the second sentence of RCW 34.04.010(3) is not applicable here.  The basic definition of "contested case", however, is contained in the first sentence of RCW 34.04.010(3).  Determining whether that sentence applies here it is more difficult.

             No provision of chapter 49.04 RCW grants an opportunity for hearing before the Council in connection with the approval or disapproval of an apprenticeship agreement.  We have found no other statute granting such an opportunity for hearing.  Therefore, an opportunity for hearing before the Council does not seem to be required by state statutory law.

             We are unable to determine with certainty whether an opportunity for hearing is required by constitutional right.  This concept refers primarily to procedural due process guarantees in the state and federal constitutions. Amendment 14 to the United States Constitution and article 1, section 3 of the Washington Constitution both provide that no person shall be deprived of "life, liberty, or property, without due process of law".  The requirements of procedural due process apply only to the deprivation of protected liberty and property interests encompassed by these constitutional provisions.  When such protected interests are implicated, some kind of hearing is usually required by the state and federal constitutions before persons may be deprived of the interests.  But the range of interests protected by procedural due process is not infinite.  See Board of Regents v. Roth, 408 U.S. 564, 33 L. Ed. 2d 548, 92 S. Ct. 2701 (1972).  We cannot conceive of any protected liberty interests affected by the disapproval of an apprenticeship agreement.  The issue thus presented is whether the disapproval of an apprenticeship agreement might deprive any person of "property", thereby triggering a due process opportunity for hearing before the Council.

             Property interests for federal due process purposes are not created by the United States Constitution, but instead stem from  [[Orig. Op. Page 7]] independent sources such as state law.  Cleveland Bd. of Educ. v. Loudermill, 470 U.S. 532, 538, 84 L. Ed. 2d 494, 105 S. Ct. 1487 (1985); Haberman v. Washington Pub. Power Supply Sys., 109 Wn.2d 107, 744 P.2d 1032, 750 P.2d 254 (1987), appeal dismissed, ___ U.S. ___, 102 L. Ed. 2d 15, 109 S. Ct. 35 (1988).  The existence of a due process property interest depends upon the claimant's having a legitimate claim of entitlement, rather than a mere unilateral expectation.  Meyer v. University of Wash., 105 Wn.2d 847, 853-54, 719 P.2d 98 (1986).  To have a property interest in a benefit, a person clearly must have more than an abstract need or desire for it.  Board of Regents v. Roth, 408 U.S. 564, 577, 33 L. Ed. 2d 548, 92 S. Ct. 2701 (1972).

            We can find no basis for concluding that any "property" interests are created by the statutes governing the Apprenticeship Council at the stage of the process before the Council's approval of an agreement.  Furthermore, we cannot conceive of any other source of law creating "property" interests at this stage of the regulatory process.4/

              Therefore, we answer your third and fourth questions in the negative.

             We trust the foregoing will be of assistance to you.

 Very truly yours,
KENNETH O. EIKENBERRY
Attorney General

JAMES K. PHARRIS
Senior Assistant Attorney General