Labor & Employment Law Daily Wrap Up, STATE-LAW CLAIMS—1st Cir.: District court erred in granting summary judgment against employees’ prevailing wage claims, (Aug 20, 2026)

By Ronald Miller, J.D.

As to the first certified question, the Massachusetts high court held that the phrase “construction and design of improvements” is not synonymous with the term “construction” as defined by the Prevailing Wage Act.

The First Circuit reversed a district court’s order granting summary judgment in favor of an employer against a claim brought by employees alleging that they were entitled to prevailing wages for repair and replacement work performed under a wastewater-services contract. The summary judgment ruling could not stand because the Massachusetts Supreme Judicial Court answered certified questions, concerning the state Prevailing Wage Act, that rejected the legal interpretations on which it relied. The appeals court determined that it is for the district court in the first instance to determine whether, and to what extent, the repair and replacement work for which plaintiffs seek prevailing wages constitutes “construction and design of improvements” under Section 6 of the Special Act, and to address any other unresolved issues of fact or law (Nicholls v. Veolia Water Contract Operations USA, Inc. fka Suez Water Environmental Services, Inc. , No. 24-1931 (1st Cir. Aug. 19, 2026)).

Prevailing wages. Employees of Veolia sought prevailing wages under the Massachusetts Prevailing Wage Act (PWA) for certain repair and replacement work they performed under Veolia’s service contract with the Springfield Water and Sewer Commission. The Commission entered into that contract pursuant to a 1997 special act, Section 6 of which provides that work falling within “the construction and design of improvements” remains governed by the PWA.

The service contract between Veolia and the Commission contemplated “two distinct stages of work.” The first stage consisted of contract-defined Initial Capital Improvements (ICI), “specific structural improvements intended to upgrade the [C]ommission’s main wastewater treatment facility.” The second stage consisted of “ongoing operation, maintenance, repair, and replacement services for the [C]ommission’s wastewater facilities and equipment,” for which Veolia employees were paid according to collective bargaining agreements. The employees’ claims concern only certain repair and replacement work they performed during the second stage.

After discovery, the parties filed cross-motions for summary judgment. The district court entered summary judgment for Veolia, holding that the PWA did not apply to the work for which the employees sought prevailing wages. The district court’s ruling rested on two interpretations of the relevant Massachusetts statutes. First, the court held categorically that the work the employees performed during the second stage did not fall within the phrase “construction and design of improvements” as used in § 6 of the Special Act.

Second, relying on the Massachusetts Supreme Court’s decision in Metcalf v. BSC Group, Inc., 214 N.E.3d 1043 (Mass. 2023), the district court held that “the nature of the procurement scheme here is inconsistent with applying the PWA to the service contract as a whole.”

Certification of questions of state law. On appeal, the First Circuit certified two unresolved and dispositive questions of Massachusetts law to the Massachusetts high court: (1) What is meant by the phrase “construction and design of improvements” as used in section 6 of 1997 Mass. Acts ch. 155? and (2) Is 1997 Mass. Acts ch. 155 incompatible with the Prevailing Wage Act, Mass. Gen. Laws ch. 149, §§ 26-27H (2024), under the court’s decision in Metcalf.

As to the first certified question, the state high court held that the phrase “construction and design of improvements” is not synonymous with the term “construction” as defined by the PWA. Rather, the Special Act employs the “technical meaning of ‘improvements’ as it pertains to property.” The Massachusetts court explained that an “improvement” is “[a] valuable addition made to property . . . or an amelioration in its condition, amounting to more than mere repairs or replacement, costing labor or capital, and intended to enhance its value, beauty or utility or to adapt it for new or further purposes.” With that understanding, the Massachusetts high court held that “the phrase ‘construction and design of improvements’ does not encompass ordinary repairs, routine inspections, day-to-day operations and maintenance, or ordinary replacements.”

However, the Massachusetts court did not determine which, if any, of the employees’ particular tasks fell within that statutory phrase. It expressly left that question open, observing that “[t]he parties appear to dispute the scope of the employees’ day-to-day work” and explaining that “[t]hese disparate descriptions do not affect our answers to the certified questions.”

As to the second certified question, the Massachusetts high court held that the Special Act is not incompatible with the PWA. The Massachusetts court distinguished Metcalf in several respects, including that the Special Act expressly provides that “[w]ork that falls within the ‘construction and design of improvements’ is governed by the PWA.” Thus, the Massachusetts court held that “Metcalf does not control the application of the [S]pecial [A]ct or its compatibility or incompatibility with the PWA.”

Summary judgment. The district court entered summary judgment for Veolia without the benefit of the Massachusetts Supreme Court’s answers to the First Circuit’s certified questions. In light of those answers, concluded the appeals court, the judgment can no longer be sustained on either of the grounds on which the district court relied.

Veolia nonetheless argued that the Massachusetts court’s answer to the first certified question requires affirmance, asserting that the employees “conceded in the trial court that their work was limited to the same set of tasks that the SJC held to be excluded from the PWA.” However, that assertion was contradicted by the record. The employees admitted only that they did not perform the contract-defined ICI or ICI Design-Build work. Throughout the litigation, they maintained that at least some of their second stage repair and replacement work constitutes “construction and design of improvements.”

Veolia also asserted that the Massachusetts high court “explicitly held that the PWA applies only to the [ICI] under the Contract, to the exclusion of ongoing repair and maintenance work.” The state court did not so hold, observed the First Circuit. It noted that nothing in the state court’s opinion equates the statutory term “improvements” with the contract-defined ICI. Instead, the state court construed “improvements” according to its “technical meaning . . . as it pertains to property,” not by reference to the contract’s ICI designation.

Accordingly, the judgment of the district court granting summary judgment to Veolia was reversed, and the matter remanded for further proceedings consistent with the opinion.

The case is No. 24-1931.

Judge: Lynch, S.

Attorneys: Terence E. Coles (Pyle Rome Ehrenberg) for Jeremy Nicholls, Walter Goodrow, Wesley Dinsmore, and Richard Ruppert. Stephen T. Melnick (Littler Mendelson) for Veolia Water Contract Operations USA, Inc. fka Suez Water Environmental Services, Inc.

Companies: Veolia Water Contract Operations USA, Inc.; Suez Water Environmental Services, Inc.

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