Pending Letter From Operating Engineers, Local 324 Fringe Funds

This bulletin only applies to contractors who have signed power of attorney to MITA for Road and Utility Distribution construction. If you are an independent union contractor, you will have received a separate mailing and will be working under a separate set of rules that will not affect your fringe benefit payments, as directed in this bulletin.

As a signatory contractor, you may be receiving a letter this week or next regarding the acceptance and crediting of fringes. This letter is a follow-up to the MITA request that all fringe benefits be accepted by Operating Engineers, Local 324 (OE 324) and credited while contract talks are at a standstill. At this point, OE 324 representatives have rejected all MITA efforts to allow employees working under the Road and Utility Distribution Agreements to be credited with the fringes that are being sent in, and thus, the checks are being accepted and held (not cashed) by OE 324.

As MITA has suggested before, your company should continue to send in your monthly fringe benefit payments on time until further notice is given. It should also be noted that all fringes for ROAD AND UTILITY DISTRIBUTION WORK should be sent in via hard copy check through regular mail. All other fringes (for underground or other types of OE 324 work) will continue to be accepted and credited as usual.

Another issue that is addressed in the letter is the payment of the Vacation and Holiday fringe. Because this fringe is taxed to the employee prior to being sent into the OE 324 fringe funds, it is considered wages for the employee, based on the various payments of wage laws at the state and federal level. Therefore, at this time, it is suggested that all Vacation & Holiday Fund contributions (15% funded) be withheld from your monthly fringe contribution check and instead be included in the weekly paycheck of all OE 324 employees working under the Road and Utility Distribution Agreements.

So, to be clear, each company working under the MITA Road or Utility Distribution (OE 324) Agreements should do the following:

* If you have not sent in your OE fringe contribution check for June, remove all Vacation & Holiday contributions and send contributions only for Pension, Healthcare, Defined Contribution, Retiree Benefit, Labor Management Education Committee and Journeymen, Apprentice Training and Industry Advancement Fund via certified mail with the attached cover letter.

* If you have already sent your fringe contribution for June (and for May if you are contributing as a signatory MITA Utility Distribution contractor), send a new check as described in the bullet point above, along with a cover letter via certified mail requesting that the earlier check be returned and replaced with the updated fringe contribution.

* Once you have sent your contributions and letters into the fringe funds, use the sample letter to communicate with your OE 324 employees and cut a retroactive check for the Vacation & Holiday fringe to those employees back to June 1 for Road employees or back to May 1 for Utility Distribution employees. Then, continue to include the Vacation & Holiday contributions (15%) in the weekly wages of each OE employee until further notice.

These payments will obviously need to be tracked very carefully, as they will need to be recognized in any future contract discussions and will also need to be easily recognized in any audit that may take place in the future.

If you have questions or concerns about this letter when you receive it, please contact Mike Nystrom, Executive Vice President, at or at 517-896-1493.