B-197282.OM, JUL 22, 1980

B-197282.OM, JUL 22, 1980

PRECIS-UNAVAILABLE

COMPTROLLER GENERAL:

HERE IS THE FILE PERTAINING TO THE APPARENT VIOLATIONS OF THE DAVIS BACON ACT, 40 U.S.C. 276A, BY EDWARDS HOME IMPROVEMENTS AND FURNACE COMPANY PERFORMING WORK UNDER VARIOUS FEDERAL HOUSING ADMINISTRATION SINGLE RE-HAB CONTRACTS AT CLEVELAND, OHIO.

DETAILS OF THE VIOLATIONS AND ADMINISTRATIVE RECOMMENDATIONS CONCERNING DEBARMENT ARE CONTAINED IN THE ATTACHED INVESTIGATIVE REPORT AND DEPARTMENT OF LABOR TRANSMITTAL LETTER. WHILE IT WAS DETERMINED THAT 4 WORKERS WERE UNDERPAID A TOTAL OF $17,508.30, AND THE CONTRACTOR PAID 3 OF THE 4 WORKERS $6,366.68 BUT REFUSED TO PAY THE BALANCE, THERE IS NO EVIDENCE THAT ANY AMOUNT WAS WITHHELD FROM THE CONTRACTOR. THEREFORE, NO FUNDS ARE AVAILABLE FOR DISBURSEMENT.

ACCORDINGLY, THE MATTER OF WHETHER THE CONTRACTOR'S NAME SHOULD BE PLACED ON THE DEBARRED BIDDERS LIST FOR VIOLATIONS UNDER THE DAVIS BACON ACT IS FORWARDED FOR YOUR CONSIDERATION AND INSTRUCTIONS.

FOR FURTHER INFORMATION, PLEASE CONTACT MS. MARCIA BROWN ON EXTENSION 53218.

INDORSEMENT

ASSOCIATE DIRECTOR, FGMS DIVISION - CLAIMS GROUP

RETURNED. EDWARDS FURNACE COMPANY, INC., EDWARDS HOME IMPROVEMENT AND FURNACE COMPANY D/B/A EDWARDS HOME IMPROVEMENT COMPANY, AND BERNARD BECKERMAN, PRESIDENT, ARE BEING NOTIFIED OF DEBARMENT FOR VIOLATION OF THE DAVIS-BACON ACT, 40 U.S.C. SEC. 276A (1976), IN ACCORDANCE WITH THE ATTACHED LETTER AND FINDINGS (COPIES), AND THESE NAMES SHOULD BE INCLUDED ON THE NEXT LISTING OF INELIGIBLES. TO FURNISH THE LABOR AND TOOLS. EDWARDS CONTENDS THAT THE CARPENTERS DID NOT PERFORM UNDER EDWARDS' SUPERVISION OR CONTROL, BUT PERFORMED INSTEAD IN ACCORDANCE WITH THE SPECIFICATIONS WITH EDWARDS' MAKING A FINAL INSPECTION OF THE WORK AFTER PERFORMANCE TO INSURE COMPLIANCE WITH THE SPECIFICATIONS. EDWARDS FURTHER STATES THAT BEFORE THE SUBCONTRACTS WERE AWARDED THE CARPENTERS SUBMITTED BIDS AND, THEREFORE, HAD AN OPPORTUNITY TO MAKE A PROFIT OR LOSE MONEY.

HOWEVER, THE RECORD INDICATES THAT THE CARPENTERS WERE NOT BONA FIDE SUBCONTRACTORS BECAUSE (1) NOTWITHSTANDING THE CONTRACTS, THEY WERE PAID HOURLY WAGE RATES, (2) THEY HAD NO PRIOR EXPERIENCE AS SUBCONTRACTORS, AND (3) THEY HAD NO OFFICE ADDRESS, COMPANY STATIONARY OR EMPLOYER NUMBER. WHILE EDWARDS CONTENDS THAT IT EXERCISED NO SUPERVISION OR CONTROL OVER THE CARPENTERS, EXCEPT FOR THE FINAL INSPECTION OF THE WORK, THIS DOES NOT APPEAR TO BE ANY DIFFERENT THAN THE RELATIONSHIP ANY EMPLOYER WOULD HAVE WITH COMPETENT EMPLOYEES EXPERIENCED ENOUGH TO WORK INDEPENDENTLY.

IN THE CIRCUMSTANCES, WE CONCLUDE THAT EDWARDS' CONTINUED FAILURE TO MAKE COMPLETE RESTITUTION TO THE CARPENTERS AFTER REPEATED ADVICE THAT THE CARPENTERS ARE NOT CONSIDERED TO BE BONA FIDE SUBCONTRACTORS CONSTITUTES A WILLFUL INTENT TO UNDERPAY ITS WORKERS IN VIOLATION OF THE DAVIS-BACON ACT. BOTH THE DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT AND THE DEPARTMENT OF LABOR HAVE RECOMMENDED DEBARMENT.

WE, THEREFORE, FIND THAT EDWARDS FURNACE COMPANY, INC., EDWARDS HOME IMPROVEMENT AND FURNACE COMPANY D/B/A EDWARDS HOME IMPROVEMENT COMPANY AND BERNARD BECKERMAN, PRESIDENT, 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 AND, PURSUANT TO THE STATUTORY DIRECTIONS, NO CONTRACT SHALL BE AWARDED TO THEM OR TO ANY FIRM, CORPORATION, PARTNERSHIP, OR ASSOCIATION IN WHICH THEY HAVE AN INTEREST UNTIL 3 YEARS HAVE ELAPSED FROM THE DATE OF THE PUBLICATION OF SUCH LIST.