B-17687, JUNE 23, 1941, 20 COMP. GEN. 921

B-17687, JUNE 23, 1941, 20 COMP. GEN. 921

CONTRACTS - COST-PLUS - INCLUSION OF TRAVELING EXPENSES OF PROSPECTIVE EMPLOYEES A COST-PLUS-A-FIXED-FEE CONTRACTOR MAY BE REIMBURSED, UNDER A CONTRACT PROVIDING FOR REIMBURSEMENT FOR LABOR PROCUREMENT EXPENSES, THE REASONABLE EXPENSES OF TRAVEL OF PROSPECTIVE EMPLOYEES WHO TRAVELED TO THE CONTRACTOR'S PLACE OF BUSINESS FOR INTERVIEWS REGARDING THEIR QUALIFICATIONS FOR EMPLOYMENT, EVEN THOUGH IN SOME INSTANCES THEY WERE FOUND NOT QUALIFIED.

COMPTROLLER GENERAL WARREN TO CAPT. W. GRITZ, U.S. ARMY, JUNE 23, 1941:

THERE HAS BEEN RECEIVED, BY REFERENCE FROM THE SECRETARY OF WAR, YOUR LETTER OF MAY 1, 1941, REQUESTING DECISION WHETHER YOU ARE AUTHORIZED TO MAKE PAYMENT ON A VOUCHER TRANSMITTED THEREWITH IN FAVOR OF MCQUAY-NORRIS MANUFACTURING CO. IN THE AMOUNT OF $114.63, COVERING REIMBURSEMENT UNDER CONTRACT NO. W-ORD-505, DATED FEBRUARY 26, 1941, FOR TRAVEL EXPENSES PAID BY THE CONTRACTOR TO PERSONS WHO TRAVELED TO THE CONTRACTOR'S PLACE OF BUSINESS IN ST. LOUIS, MO., FOR INTERVIEWS WITH A VIEW TOWARD EMPLOYMENT, BUT WHO WERE NOT EMPLOYED BY THE CONTRACTOR.

BY THIRD INDORSEMENT OF MAY 26, 1941, TO THE CHIEF OF FINANCE, THE ORDNANCE OFFICE, WAR DEPARTMENT, MAKES THE FOLLOWING EXPLANATION OF THE EXPENDITURES FOR WHICH REIMBURSEMENT IS CLAIMED ON THIS VOUCHER.

1. THE ATTACHED VOUCHER COVERS REIMBURSEMENT TO THE MCQUAY-NORRIS MANUFACTURING COMPANY FOR TRAVEL EXPENSES INCURRED BY FOUR PROSPECTIVE EMPLOYEES FROM THEIR HOMES TO ST. LOUIS MISSOURI, AND RETURN, FOR THE PURPOSE OF AN INTERVIEW TOWARD EMPLOYMENT UNDER COST-PLUS-A-FIXED-FEE CONTRACT NUMBER W-ORD-505. SUCH EXPENSES ARE AUTHORIZED BY SECTION ID, ARTICLE III-A OF TITLE III OF SAID CONTRACT WHICH PROVIDES FOR REIMBURSEMENT FOR "* * * EXPENSES OF PROCURING LABOR * * *.'

2. IT IS RECOGNIZED THAT ALL PERSONS REQUESTED TO REPORT FOR AN INTERVIEW TOWARD EMPLOYMENT WILL NOT BE EMPLOYED, AND WITH THE EXIGENCY OF NATIONAL DEFENSE PLACING A PREMIUM ON QUALIFIED PERSONNEL, IT IS NECESSARY TO OFFER TO REIMBURSE PROSPECTIVE EMPLOYEES FOR TRAVEL FROM THEIR HOMES TO PLACE OF INTERVIEW AND RETURN. INASMUCH AS THE PROSPECTIVE EMPLOYEES IN THE INSTANT CASE WERE NOT QUALIFIED TO FILL THE POSITIONS THEY SOUGHT, EMPLOYMENT WAS NOT CONSUMMATED AND THEY WERE REIMBURSED BY THE CONTRACTOR FOR TRAVEL EXPENSES INCURRED. THIS APPEARS TO BE CLEARLY AN EXPENSE OF PROCURING LABOR AS CONTEMPLATED BY THE CONTRACT.

3. THE EXPENSES ARE SUCH AS ARE USUALLY INCURRED BY AN EMPLOYER DESIRING TO INTERVIEW POTENTIAL EMPLOYEES FOR KEY POSITIONS, ARE IN ACCORDANCE WITH THE USUAL PRACTICE OF THE CONTRACTOR, AND WERE APPROVED BY THE CONTRACTING OFFICER'S REPRESENTATIVE. IT HAS NOT BEEN THE USUAL PRACTICE OF THE CONTRACTOR TO REQUIRE THAT RECEIPTS BE FURNISHED FOR TRAVEL EXPENSES, AND THEREFORE THE PROSPECTIVE EMPLOYEES WERE NOT INFORMED THAT SAME WOULD BE REQUIRED.

4. IT IS RECOMMENDED THAT THE ABOVE VOUCHER BE PAID INASMUCH AS THE EXPENDITURES ARE IN ACCORDANCE WITH THE CONTRACTOR'S USUAL PROCEDURES, ARE AUTHORIZED BY THE CONTRACT, AND HAVE BEEN APPROVED BY THE CONTRACTING OFFICER'S REPRESENTATIVE.

5. INASMUCH AS THIS IS THE FIRST VOUCHER PRESENTED FOR PAYMENT COVERING REIMBURSEMENT FOR TRAVEL EXPENSES BY POTENTIAL EMPLOYEES, AND AS OTHER CONTRACTS ENTERED INTO BY THE ORDNANCE DEPARTMENT INCLUDE A PROVISION AUTHORIZING SUCH EXPENDITURES, IT IS REQUESTED THAT THE MATTER BE SUBMITTED TO THE COMPTROLLER GENERAL FOR DECISION AS TO WHAT EVIDENCE SHOULD BE SUBMITTED IN SUPPORT OF VOUCHERS COVERING REIMBURSEMENT FOR EXPENSES OF PROCURING LABOR FOR FUTURE GUIDANCE.

THE VOUCHER IS SUPPORTED BY ITEMIZED STATEMENTS OF THE EXPENSES INCURRED BY THE VARIOUS TRAVELERS, TOGETHER WITH THEIR SIGNED RECEIPTS INDICATING THE PAYMENT OF SUCH EXPENSES TO THEM BY THE CONTRACTOR.

CONTRACT NO. W-ORD-505 PROVIDES FOR THE EQUIPMENT, PREPARATION FOR OPERATIONS (INCLUDING TRAINING OF OPERATING PERSONNEL) AND OPERATION OF AN ORDNANCE MANUFACTURING PLANT, IN CONSIDERATION OF THE REIMBURSEMENT BY THE GOVERNMENT OF THE CONTRACTOR'S EXPENDITURES AS PROVIDED IN THE CONTRACT, PLUS A STIPULATED FIXED FEE. BY ARTICLE II-D OF THE CONTRACT THE CONTRACTOR IS AUTHORIZED TO DO ALL THINGS NECESSARY OR CONVENIENT IN AND ABOUT THE OPERATING AND CLOSING DOWN OF THE PLANT, INCLUDING THE EMPLOYMENT OF ALL PERSONS ENGAGED IN THE WORK UNDER THE CONTRACT.

ARTICLE III-A OF THE CONTRACT PROVIDES, IN PERTINENT PART, THAT:

1. THE CONTRACTOR SHALL BE REIMBURSED IN THE MANNER HEREINAFTER DESCRIBED FOR SUCH OF ITS ACTUAL EXPENDITURES IN THE PERFORMANCE OF THE WORK UNDER THIS CONTRACT AS MAY BE APPROVED OR RATIFIED BY THE CONTRACTING OFFICER AND WHICH COSTS AND EXPENSES SHALL INCLUDE BUT SHALL NOT BE LIMITED TO THE FOLLOWING ITEMS:

D. TRANSPORTATION, TRAVELING AND HOTEL EXPENSES TO AND FROM THE WORK OF THE NECESSARY FIELD FORCES FOR THE ECONOMICAL AND SUCCESSFUL PROSECUTION OF THE WORK; EXPENSES OF PROCURING LABOR AND EXPEDITING THE PRODUCTION AND TRANSPORTATION OF MATERIAL AND EQUIPMENT.

IT APPEARS PROPER TO CONSIDER THAT THE CONTRACTOR'S EXPENSES OF PROCURING LABOR, FOR WHICH REIMBURSEMENT IS AUTHORIZED BY THE ABOVE QUOTED CONTRACT PROVISION, COMPREHENDS SUCH REASONABLE TRAVEL EXPENSES AS IT MAY BE REQUIRED TO PAY TO PROSPECTIVE EMPLOYEES IN ORDER TO SECURE THEIR PRESENCE AT AN INTERVIEW FOR THE PURPOSE OF DETERMINING THEIR QUALIFICATIONS FOR THE POSITIONS SOUGHT, EVEN THOUGH IN SOME INSTANCES THE CONTRACTOR MAY FIND THE APPLICANT UNQUALIFIED FOR EMPLOYMENT.

ACCORDINGLY, THE VOUCHER, TOGETHER WITH SUPPORTING PAPERS, IS RETURNED WITH THE ADVICE THAT PAYMENT THEREOF IS AUTHORIZED, IF OTHERWISE CORRECT.