B-166009, MAY 23, 1969

B-166009: May 23, 1969

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INC.: ENCLOSED IS A COPY OF OUR FINDING OF TODAY THAT WASHINGTON ELECTRIC AND MACHINE. HAVE DISREGARDED OBLIGATIONS TO EMPLOYEES WITHIN THE MEANING OF THE DAVIS BACON ACT. THESE NAMES WILL BE INCLUDED IN THE NEXT PUBLICATION OF THE DEBARRED LIST. NO GOVERNMENT CONTRACT WILL BE AWARDED TO THEM OR TO ANY FIRM. OR ASSOCIATION IN WHICH SUCH PERSON OR FIRM HAS AN INTEREST UNTIL THREE YEARS HAVE ELAPSED FROM THE DATE OF PUBLICATION. 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.

B-166009, MAY 23, 1969

TO WASHINGTON ELECTRIC AND MACHINE, INC.:

ENCLOSED IS A COPY OF OUR FINDING OF TODAY THAT WASHINGTON ELECTRIC AND MACHINE, INC., AND ITS RESPONSIBLE OFFICIALS, MR. EDWARD W. KEENE, PRESIDENT, AND MR. N. T. COURTNEY, VICE-PRESIDENT, INDIVIDUALLY, HAVE DISREGARDED OBLIGATIONS TO EMPLOYEES WITHIN THE MEANING OF THE DAVIS BACON ACT, 49 STAT. 1011, 40 U.S.C. 276A, IN THE PERFORMANCE OF A SUBCONTRACT UNDER CONTRACT NO. DA-36-058-ENG-5205 FOR THE CONSTRUCTION OF ABAR FACILITIES IN THE PITTSBURGH DEFENSE AREA, PENNSYLVANIA.

PURSUANT TO THE PROVISIONS OF SECTION 3 (A) OF THE ACT, THESE NAMES WILL BE INCLUDED IN THE NEXT PUBLICATION OF THE DEBARRED LIST, AND NO GOVERNMENT CONTRACT WILL BE AWARDED TO THEM OR TO ANY FIRM, CORPORATION, PARTNERSHIP, OR ASSOCIATION IN WHICH SUCH PERSON OR FIRM HAS AN INTEREST UNTIL THREE YEARS HAVE ELAPSED FROM THE DATE OF PUBLICATION.

FINDING

IN THE MATTER OF WASHINGTON ELECTRIC AND MACHINE, INC., AND ITS RESPONSIBLE OFFICIALS, EDWARD W. KEENE, PRESIDENT, AND N. T. COURTNEY, VICE-PRESIDENT.

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, OR 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. DA-36-058-ENG-5205 IN EXCESS OF $2,000, FOR THE CONSTRUCTION OF ABAR FACILITIES IN THE PITTSBURGH DEFENSE AREA, PENNSYLVANIA, WAS ENTERED INTO ON JUNE 30, 1967, BY THE DEPARTMENT OF THE ARMY WITH A. GERIS, INC., SPRINGDALE, PENNSYLVANIA. PORTIONS OF THE WORK WERE SUBCONTRACTED TO WASHINGTON ELECTRIC AND MACHINE, INC. THE CONTRACT AND SUBCONTRACT CONTAINED THE STIPULATIONS AND REPRESENTATIONS REQUIRED BY SECTION 1 (A) OF THE ACT.

AN INVESTIGATION CONDUCTED BY THE DEPARTMENT OF THE ARMY DISCLOSED THAT THE SUBCONTRACTOR HAVING FULL KNOWLEDGE OF HIS STATUTORY AND CONTRACTUAL RESPONSIBILITIES DID, NEVERTHELESS, DISREGARD THESE OBLIGATIONS AS EVIDENCED BY THE DELIBERATE PAYMENT OF SUBMINIMUM WAGE RATES TO LABORERS AND MECHANICS EMPLOYED ON THE SUBJECT PROJECT. AS A RESULT OF THIS INVESTIGATION, THREE EMPLOYEES WERE FOUND TO HAVE BEEN UNDERPAID A TOTAL OF $1,160 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.

BY REGISTERED LETTERS DATED OCTOBER 2, 1967, THE DEPARTMENT OF LABOR NOTIFIED THE SUBCONTRACTOR AND ITS RESPONSIBLE OFFICIALS IN DETAIL OF THE NATURE AND EXTENT OF THE LABOR STANDARDS VIOLATIONS, BUT NO ANSWER WAS RECEIVED THERETO.

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 ENSURING COMPLIANCE. THE DEPARTMENT OF THE ARMY AND THE DEPARTMENT OF LABOR HAVE RECOMMENDED IMPOSITION OF DEBARMENT.

WE, THEREFORE, FIND THAT WASHINGTON ELECTRIC AND MACHINE, INC., AND ITS RESPONSIBLE OFFICIALS, MR. EDWARD W. KEENE, PRESIDENT, AND MR. N. T. COURTNEY, VICE-PRESIDENT, 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 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.