B-163045, APR. 29, 1968

B-163045: Apr 29, 1968

Additional Materials:

Contact:

Edda Emmanuelli Perez
(202) 512-2853
EmmanuelliPerezE@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

TO WHICH THE UNITED STATES * * * IS A PARTY. SECTION 3 (A) OF THE ACT PROVIDES THAT - "* * * THE COMPTROLLER GENERAL OF THE UNITED STATES IS FURTHER AUTHORIZED AND IS DIRECTED TO DISTRIBUTE A LIST TO ALL DEPARTMENTS OF THE GOVERNMENT GIVING THE NAMES OF PERSONS OR FIRMS WHOM HE HAS FOUND TO HAVE DISREGARDED THEIR OBLIGATIONS TO EMPLOYEES AND SUBCONTRACTORS. OR ASSOCIATION IN WHICH SUCH PERSONS OR FIRMS HAVE AN INTEREST UNTIL THREE YEARS HAVE ELAPSED FROM THE DATE OF PUBLICATION OF THE LIST CONTAINING THE NAMES OF SUCH PERSONS OR FIRMS.'. WAS ENTERED INTO ON JUNE 29. 12 EMPLOYEES WERE FOUND TO HAVE BEEN UNDERPAID A TOTAL OF $573.01 IN VIOLATION OF THE DAVIS-BACON ACT UNDER THE TERMS OF THE CONTRACT.

B-163045, APR. 29, 1968

FINDING

IN THE MATTER OF BROWN ELECTRIC AND MR. FLOYD B. BROWN, MANAGER, P.O. BOX 786, PLATTSBURGH, NEW YORK

SECTION 1 (A) OF THE DAVIS-BACON ACT OF AUGUST 30, 1935, 49 STAT. 1011, 40 U.S.C. 276A, PROVIDES IN PART THAT --

"THE ADVERTISED SPECIFICATIONS FOR EVERY CONTRACT IN EXCESS OF $2,000, TO WHICH THE UNITED STATES * * * IS A PARTY, FOR CONSTRUCTION,ALTERATION, AND/OR REPAIR, INCLUDING PAINTING AND DECORATING, OF PUBLIC BUILDINGS OR PUBLIC WORKS OF THE UNITED STATES * * * AND WHICH REQUIRES OR INVOLVES THE EMPLOYMENT OF MECHANICS AND/OR LABORERS SHALL CONTAIN A PROVISION STATING THE MINIMUM WAGES TO BE PAID VARIOUS CLASSES OF LABORERS AND MECHANICS * * * AND EVERY CONTRACT BASED UPON THESE SPECIFICATIONS SHALL CONTAIN A STIPULATION THAT THE CONTRACTOR OR HIS SUBCONTRACTOR SHALL PAY ALL MECHANICS AND LABORERS EMPLOYED DIRECTLY UPON THE SITE OF THE WORK, UNCONDITIONALLY AND NOT LESS OFTEN THAN ONCE A WEEK AND WITHOUT SUBSEQUENT DEDUCTION OR REBATE ON ANY ACCOUNT, THE FULL AMOUNTS ACCRUED AT TIME OF PAYMENT, COMPUTED AT WAGE RATES NOT LESS THAN THOSE STATED IN THE ADVERTISED SPECIFICATIONS, REGARDLESS OF ANY CONTRACTUAL RELATIONSHIP WHICH MAY BE ALLEGED TO EXIST BETWEEN THE CONTRACTOR OR SUBCONTRACTOR AND SUCH LABORERS AND MECHANICS * * *.' SECTION 3 (A) OF THE ACT PROVIDES THAT -

"* * * THE COMPTROLLER GENERAL OF THE UNITED STATES IS FURTHER AUTHORIZED AND IS DIRECTED TO DISTRIBUTE A LIST TO ALL DEPARTMENTS OF THE GOVERNMENT GIVING THE NAMES OF PERSONS OR FIRMS WHOM HE HAS FOUND TO HAVE DISREGARDED THEIR OBLIGATIONS TO EMPLOYEES AND SUBCONTRACTORS. NO CONTRACT SHALL BE AWARDED TO THE PERSONS OR FIRMS APPEARING ON THIS LIST OR TO ANY FIRM, CORPORATION, PARTNERSHIP, OR ASSOCIATION IN WHICH SUCH PERSONS OR FIRMS HAVE AN INTEREST UNTIL THREE YEARS HAVE ELAPSED FROM THE DATE OF PUBLICATION OF THE LIST CONTAINING THE NAMES OF SUCH PERSONS OR FIRMS.'

CONTRACT NO. AF 30 (603) 1966, IN EXCESS OF $2,000, FOR THE CONVERSION OF HEATING UNITS FROM COAL TO OIL AND THE INSTALLATION OF WATER HEATERS AT THE STEWART AIR FORCE BASE, NEW YORK, WAS ENTERED INTO ON JUNE 29, 1965, BY THE DEPARTMENT OF THE AIR FORCE WITH BROWN ELECTRIC, MR. FLOYD B. BROWN, MANAGER. THE CONTRACT CONTAINED THE STIPULATIONS AND REPRESENTATIONS REQUIRED BY SECTION 1 (A) OF THE ACT.

AN INVESTIGATION CONDUCTED BY THE DEPARTMENT OF THE AIR FORCE DISCLOSED THAT THE CONTRACTOR HAVING FULL KNOWLEDGE OF HIS STATUTORY AND CONTRACTUAL RESPONSIBILITIES DID NEVERTHELESS DISREGARD THESE OBLIGATIONS AS EVIDENCED BY THE DELIBERATE PAYMENT OF SUB-MINIMUM WAGE RATES TO LABORERS AND MECHANICS EMPLOYED ON THE SUBJECT PROJECT. AS A RESULT OF THIS INVESTIGATION, 12 EMPLOYEES WERE FOUND TO HAVE BEEN UNDERPAID A TOTAL OF $573.01 IN VIOLATION OF THE DAVIS-BACON ACT UNDER THE TERMS OF THE CONTRACT. THE INVESTIGATION REPORT ALSO REVEALED THAT CERTIFIED PAYROLLS SUBMITTED TO THE CONTRACTING AGENCY CONTAINED INCORRECT INFORMATION DESIGNED TO SIMULATE COMPLIANCE WITH THE APPLICABLE LABOR STANDARDS REQUIREMENTS. IN PARTICULAR, THE INVESTIGATION REPORT REVEALED THAT THE NAMES OF THE 12 UNDERPAID EMPLOYEES WERE NOT LISTED IN THE CERTIFIED PAYROLLS SUBMITTED BY BROWN ELECTRIC, EVEN THOUGH MR. BROWN HAD REPRESENTED THEREIN THAT SUCH PAYROLLS WERE CORRECT AND COMPLETE. THE CONTRACTOR FAILED TO TAKE CORRECTIVE ACTION AND THE BONDING COMPANY SUBSEQUENTLY SUBMITTED A CHECK IN THE AMOUNT OF $825.26 TO COVER THE DAVIS -BACON ACT AND OTHER LABOR STANDARDS VIOLATIONS DISCLOSED BY THE INVESTIGATION.

BY REGISTERED LETTER DATED SEPTEMBER 26, 1967, THE DEPARTMENT OF LABOR ATTEMPTED TO NOTIFY THE CONTRACTOR IN DETAIL OF THE NATURE AND EXTENT OF THE LABOR STANDARDS VIOLATIONS. HOWEVER, THAT LETTER WAS NOT DELIVERED, BEING RETURNED BY THE POST OFFICE WITH THE NOTATION "MOVED, LEFT NO ADDRESS.'

IT IS CLEAR, PARTICULARLY IN THE LIGHT OF THE FALSE PAYROLLS, THAT GOOD FAITH WAS NOT SHOWN IN COMPLYING WITH THE ACT AND CONTRACTUAL PROVISIONS. ONLY THROUGH INVESTIGATION AND DETECTION OF THE MISLEADING INFORMATION FURNISHED IN THE PAYROLL REPORTS WAS IT POSSIBLE FOR THE GOVERNMENT TO ADOPT MEASURES PROTECTING THE EMPLOYEES INVOLVED AND INSURING COMPLIANCE. THE DEPARTMENT OF THE AIR FORCE AND THE DEPARTMENT OF LABOR HAVE RECOMMENDED IMPOSITION OF DEBARMENT.

WE, THEREFORE, FIND THAT BROWN ELECTRIC, AND MR. FLOYD B. BROWN, MANAGER, INDIVIDUALLY, HAVE DISREGARDED "OBLIGATIONS TO EMPLOYEES" WITHIN THE MEANING OF THE DAVIS-BACON ACT. ACCORDINGLY, THESE NAMES WILL BE INCLUDED ON A LIST FOR DISTRIBUTION TO ALL AGENCIES OF THE GOVERNMENT PURSUANT TO THE STATUTORY REQUIREMENTS, AND NO CONTRACT SHALL BE AWARDED TO THEM OR TO ANY FIRM, CORPORATION, PARTNERSHIP, OR ASSOCIATION IN WHICH THEY HAVE AN INTEREST UNTIL THREE YEARS HAVE ELAPSED FROM THE DATE OF PUBLICATION OF SUCH LIST.