Hon. Tanya Walton Pratt of the Southern District of 

Indiana, sitting by designation.

In the

United States Court of Appeals

For the Seventh Circuit

No. 11-1920

BEARY LANDSCAPING, INC., et al.,

Plaintiffs-Appellants,

v.

JOE COSTIGAN, in his official capacity as

Director of the Illinois Department of Labor,

Defendant-Appellee.

Appeal from the United States District Court

for the Northern District of Illinois, Eastern Division.

No. 05 C 5697—James B. Zagel, Judge.

ARGUED NOVEMBER 29, 2011—DECIDED JANUARY 31, 2012

Before POSNER and KANNE, Circuit Judges, and

PRATT, District Judge.



POSNER, Circuit Judge. Illinois law provides that

“workers . . . employed by or on behalf of any public

body engaged in the construction or demolition of
2 No. 11-1920

public works” (defined as “all fixed works constructed or

demolished by any public body, or paid for wholly or in

part out of public funds,” 820 ILCS 130/2) shall be paid

“not less than the general prevailing rate of hourly

wages for work of a similar character on [nonfederal]

public works in the locality in which the work is performed.” 820 ILCS 130/3. The “public body awarding [the]

contract” is required to determine what the prevailing

wage is, 820 ILCS 130/4(a), but the Department of Labor

is required to conduct annual investigations to determine the prevailing wage for each type of construction

and demolition work in each locality (generally defined

as a county, 820 ILCS 130/2) in which such work

is being performed, and in practice the public bodies

simply adopt that determination.

The Department’s determination may, though only

within 30 days after it is published, be challenged administratively by “any person affected” by it. 820 ILCS

130/9. If the Department rejects the challenge, the challenger can appeal to the Illinois courts. Id.; 735 ILCS 5/3-

102; see Hayen v. County of Ogle, 463 N.E.2d 124, 126

(Ill. 1984); Beary Landscaping, Inc. v. Ludwig, 479 F. Supp. 2d

857, 862 (N.D. Ill. 2007); People ex rel. Dep’t of Labor v. Skoog

Landscape & Design, 785 N.E.2d 992, 995 (Ill. App. 2003).

If an employer pays less than the prevailing wage to

employees working on a nonfederal public work, the

Department can sue for the underpayment on behalf of

the employees and also levy a separate penalty that it

retains. 820 ILCS 130/11; Brandt Construction Co. v.

Ludwig, 878 N.E.2d 116, 121 (Ill. App. 2007).
No. 11-1920 3

A number of landscape contractors in eight Illinois

counties who do nonfederal public-works projects involving construction tasks, such as planting trees, installing ornaments, sodding and seeding, stabilizing stream

banks, and applying fertilizer and other chemicals to the

soil, brought this suit against the Department. They

argue that it has violated the due process clause by delegating the ascertainment of the prevailing wage for publicly financed landscape construction work to private

entities, namely a labor union and the contractors

with which it has a collective bargaining agreement.

The district judge granted summary judgment in favor

of the Department.

Landscape laborers (as distinct from operators of equipment, including trucks, used in landscape construction

projects, whom we can disregard) employed by these

contractors are called “plantsmen.” This is an unconventional usage—“plantsman” as ordinarily understood

means either an enthusiastic and knowledgeable

gardener or someone who raises or sells plants commercially. But no matter. Traditionally in Illinois plantsmen

in the sense of landscape laborers have been represented

by the Laborers Union, which represents many other

types of construction laborer as well. To determine the

prevailing wage for laborers, the Department in its

annual investigations simply asks the Laborers Union

to certify the current wage of laborers employed in

public works (by locality within Illinois) under the

Union’s collective bargaining agreement with construction contractors. A contractor who pays a lower wage to

a worker on a public work than the wage specified in
4 No. 11-1920

that agreement receives a demand letter from the Department and if he doesn’t comply the Department can, as

we know, sue him; it may also bar him from bidding

on future public contracts if he is a repeat offender.

820 ILCS 130/11a.

In 2005 the Illinois Landscape Contractors Bargaining

Association signed a collective bargaining agreement

with the Teamsters Union and the International Union

of Operating Engineers that specified a wage for plantsmen that was substantially below the wage in the

Laborers Union collective bargaining contract. The

Illinois Landscape Contractors Association—a different

organization from the Illinois Landscape Contractors

Bargaining Association but with an overlapping membership—asked the Department to recognize plantsmen as a subclassification of laborers, having their

own prevailing wage, which the association argued

was the wage specified in the Teamsters/Operating Engineers collective bargaining agreement. (We shall

refer to that collective bargaining agreement as the

“Landscapers Contract” and the one signed by the Laborers Union as the “Laborers Contract.”) The Department refused and its refusal was upheld in Illinois Landscape Contractors Ass’n v. Department of Labor, 866

N.E.2d 592 (Ill. App. 2007). As a result of that decision, the

Department, without investigating the prevailing wage

for landscape laborers employed on public works in

the localities in which the plaintiffs operate, continues

basing the prevailing wage for plantsmen on the wage

in the Laborers Contract.
No. 11-1920 5

The plaintiffs refuse to pay that wage, and have been

sued by the Department in state court. Those suits have

been stayed, however, pursuant to 735 ILCS 5/2-619(a)(3),

which authorizes such a stay if there is another action

pending between the same parties that involves the

same claim. The other action is this suit, in which

the plaintiffs argue that by rubber-stamping the wage

rate in the Laborers Contract the Department has delegated a governmental function to private entities—the

union, and the employers who have signed a collective bargaining contract with the union. (The stay

makes the otherwise attractive option of the federal

courts’ abstaining in favor of the state court’s enforcement action unavailable.) The plaintiffs contend that

the money that the Department is seeking from them in

its state court suits is their property (which it is), and

that a state that delegates the taking of private property

to a private entity violates the nondelegation doctrine

of constitutional law (which is sometimes true).

The doctrine as usually understood and applied, however, just forbids Congress to delegate federal legislative

powers, which are vested in Congress by Article I, section 1 of the Constitution, to agencies without giving

them guidance on how the delegated powers should be

exercised. Whitman v. American Trucking Associations, Inc.,

531 U.S. 457, 472-76 (2001); Mistretta v. United States,

488 U.S. 361, 371-73 (1989); National Broadcasting Co. v.

United States, 319 U.S. 190, 215-16, 225-26 (1943) (Frankfurter, J.); Lac Courte Oreilles Band of Lake Superior

Chippewa Indians of Wisconsin v. United States, 367 F.3d

650, 658-59 (7th Cir. 2004). (Why guidance should make
6 No. 11-1920

the delegation okay is unclear, especially since the guidance is often vague or open-ended.) But nothing in the

Constitution prescribes the allocation of powers within

state governments, Whalen v. United States, 445 U.S. 684, 689

n. 4 (1980); Mayor of City of Philadelphia v. Educational

Equality League, 415 U.S. 605, 615 and n. 13 (1974); Chicago

Observer, Inc. v. City of Chicago, 929 F.2d 325, 328 (7th Cir.

1991); Straley v. Utah Board of Pardons, 582 F.3d 1208, 1215

(10th Cir. 2009); Consolidated Edison Co. of New York, Inc. v.

Pataki, 292 F.3d 338, 346 n. 4 (2d Cir. 2002)—not even

the clause guaranteeing to each state a republican form

of government, Art. IV, § 4. For to be a “republic,” a

state or nation need not parcel out powers among

different branches in any particular fashion, such as that

in the federal Constitution.

But an offshoot of the constitutional nondelegation doctrine that is applicable to the states forbids them

to authorize private persons to deprive other private

persons of life, liberty, or property without due process of

law. The standard example is a law that empowers landowners to determine, by whim, how a neighbor may use

his own property. Washington ex rel. Seattle Title Trust Co. v.

Roberge, 278 U.S. 116, 121-22 (1928); Eubank v. City of

Richmond, 226 U.S. 137, 143-44 (1912); cf. Philly’s v. Byrne,

732 F.2d 87, 92 (7th Cir. 1984); Young v. City of Simi Valley,

216 F.3d 807, 817-18 (9th Cir. 2000).

But the present case is remote from that example. It

doesn’t involve a comparable threat to property rights,

given settled law that, contrary to older understandings,

authorizes a good deal of “delegated” encroachment on
No. 11-1920 7

property rights. See Philly’s v. Byrne, supra. A state can

prescribe a minimum wage, which is bound to be based

on private wage determinations, and it can require employers that have contracts with the state to pay their

employees a prevailing wage, Atkin v. Kansas, 191 U.S.

207, 222-23 (1903); Frank Bros., Inc. v. Wisconsin Dep’t of

Transportation, 409 F.3d 880, 889-90 and n. 9 (7th Cir.

2005), which is a minimum wage determined by reference to what private employers are paying. Parker v.

Brown, 317 U.S. 341 (1943), upheld against a variety of

constitutional challenges a state program for establishing minimum prices for raisins that was administered by raisin producers. Minimum product prices

are analogous to minimum wages, which are minimum

prices for labor services. But in this case a state agency

merely has determined that plantsmen are comparable

to other laborers and so should receive the same

minimum wage. That is a routine type of determination

made en route to fixing a prevailing wage, and the plaintiffs have not shown that the decision in Illinois

Landscape Contractors Ass’n v. Department of Labor

that upheld the determination was unreasonable. They

would not be permitted even to try to show it, in this

case at any rate, because as members of the contractors

association, sharing the interest of the other members

in defeating the determination and represented by the

same lawyer who represented the association in

the landscape contractors case, they are bound by

that determination. See Stichting Ter Behartiging Van de

Belangen Van Oudaandeelhouders In Het Kapitaal Van

Saybolt International B.V. v. Schreiber, 327 F.3d 173, 184-86
8 No. 11-1920

(2d Cir. 2003); Tahoe-Sierra Preservation Council, Inc. v. Tahoe

Regional Planning Agency, 322 F.3d 1064, 1082 (9th Cir.

2003); Expert Electric, Inc. v. Levine, 554 F.2d 1227, 1233-34

(2d Cir. 1977); 18A Charles Alan Wright et al., Federal

Practice and Procedure § 4456, pp. 502-05 (2d ed. 2002).

Their objection, rather, is to the Department’s rubberstamping the wage in the Laborers Contract as the prevailing wage for plantsmen. Maybe plantsmen on public

projects are actually paid a different wage, and that

different wage is the prevailing wage for such workers.

But before the Department’s determination of the

prevailing wage for landscape workers became final, any

party or parties affected by it, such as these plaintiffs,

could object to the determination within thirty days of

its posting and by doing so obtain both administrative

and judicial review. The plaintiffs did not object to the

determination. They argue that they couldn’t because

they weren’t “person[s] affected” by it, not yet having

bid on public landscape construction projects to which

the latest annual determination of the prevailing wage

(based on the wage rate in the Laborers Contract)

would apply. But they were affected prospectively. The

price they bid on such projects will be higher if they

have to pay that rate, and they will probably have to

post a larger surety bond as well. See 820 ILCS 130/4(c). So

they will be less likely to be the low bidders than if, as

signatories of the Landscapers Contract, they can pay

a lower wage to their plantsmen than their competitors

who employ general construction laborers whose wages

are prescribed in the Laborers Contract.
No. 11-1920 9

The plaintiffs argue that a challenge to the Department’s

determination would have been futile because most

landscape contractors would be afraid to buck the Department, and if enough bowed to the new determination

the wage in the Laborers Contract would be the prevailing

wage. But that is wrong too, because if the plaintiffs’

challenge succeeded, either as a direct challenge or as an

affirmative defense in an enforcement action, the Department would be required to recalculate the prevailing

wage. 735 ILCS 5/3-111(a)(5)-(6); Hayen v. County of

Ogle, supra, 463 N.E.2d at 126; see also 820 ILCS 130/9.

Given these administrative and judicial remedies, we

conclude that the Illinois legislature and the Illinois

Department of Labor haven’t delegated regulatory

power to private parties (namely the signatories of the

Laborers Union collective bargaining contract). But

before engraving this conclusion in stone we need to

address the lone case that might be thought to support

the plaintiffs’ position: General Electric Co. v. New York

State Dep’t of Labor, 936 F.2d 1448, 1457-59 (2d Cir. 1991).

Having paid a lower wage to electrical workers than a

wage deemed by the state department of labor to be the

prevailing wage (for public projects) that had been fixed

in collective bargaining agreements between a union and

an association of electrical contractors, GE challenged as

an unconstitutional delegation of governmental power to

private entities the law under which the department

had determined the prevailing wage. The court held

that the challenge had prima facie merit:

The two “adversary” parties [the union and the

contractors association] set a relatively low rate for
10 No. 11-1920

electrical work done in the private sector in order

(from the union’s perspective) to make employment

of union workers more attractive to employers, and

(from the employers’ perspective) to achieve lower

labor costs for private sector employers. A higher

wage rate for public work projects was agreed to in

order (from the union’s perspective) to make up

some of the wages lost on the private sector work,

and (from the employers’ perspective) to give the

unions higher wages without the employers incurring greater labor costs since the higher wages

would be passed on to the taxpayers.

If this is in fact what occurred—and we express no

view as to whether it did or did not—then neither

side was forced to curb its self-interest, and the rates

set in the agreement are potentially arbitrary

because they reflect not the wage rates of an adversarial marketplace, but the wage rates in a setting

skewed by the bargaining parties’ knowing use of

their agreement to achieve selfish ends. . . .

Thus, the Department’s procedures seem not to

involve the exercise of any discretion in setting prevailing wage and supplement rates. The state’s insistence that it does not merely take whatever rates

the unions submit, but sets the prevailing rate at

that actually paid in the locality may well be the

case, but we must take as true for purposes of this

appeal GE’s allegations regarding the actual procedure followed by the state.

This disputed fact is material because both collective

bargaining agreements from which the rates were
No. 11-1920 11

drawn explicitly provide for two wage rates, and bar

application of the lower wage rate to public work

projects. If this two wage rate system was collusively

negotiated, and simply adopted pro forma by the

state (without exercising any discretion) as the resulting wage rates, this would clearly establish an

unconstitutional delegation of authority under the

statute as applied.

Id. at 1457-59.

The court thus assimilated the case to ones we cited

earlier in which a state or local government authorizes

landowners to impair at will their neighbors’ property

rights. That is not the character of the action by the

Illinois Department of Labor. It merely decided what the

relevant category of workers on public landscaping

projects was (namely laborers) and hence what collective

bargaining agreement it should look to for determining

the prevailing wage rate for workers in that category.

The decision to look to the Laborers Contract rather than

to the Landscapers Contract to determine the prevailing

wage for plantsmen was reasonable. Even if they outnumber other laborers on most public landscaping projects,

many of those projects are not subject to the Prevailing

Wage Act, as we learn from a chart published on the

Department’s website: “Prevailing Wage Act: Coverage

of Landscaping Activities,” www.state.il.us/agency/idol/

forms/pdfs/PWLandscapeRates.pdf (visited Jan. 16, 2012).

For aught that appears, construction workers do most

of the landscaping work on public projects that are subject to the Act, thus making their wage—the wage in
12 No. 11-1920

the Laborers Contract—the prevailing wage of landscape

laborers (plantsmen).

Illinois’s procedure is further distinguishable from

New York’s because of the 30-day deadline for challenging the Illinois department’s determination of the

prevailing wage. That deadline is proximate enough to

the initial wage determination to make the challenge

proceeding part of the wage-setting process rather than

process belatedly bestowed after an unconstitutional

delegation is complete.

AFFIRMED.

1-31-12