B-199252.OM, JUL 22, 1980

B-199252.OM: Jul 22, 1980

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PRECIS-UNAVAILABLE COMPTROLLER GENERAL: WE ARE FORWARDING THE FILE PERTAINING TO THE APPARENT VIOLATIONS OF THE DAVIS-BACON ACT. DETAILS OF THE VIOLATIONS AND ADMINISTRATIVE RECOMMENDATIONS CONCERNING DEBARMENT ARE CONTAINED IN THE ATTACHED INVESTIGATIVE REPORT AND DEPARTMENT OF LABOR TRANSMITTAL LETTER. OUR PROPOSAL AND THE MATTER OF WHETHER THE CONTRACTOR'S NAME SHOULD BE PLACED ON THE DEBARRED BIDDERS LIST FOR VIOLATIONS UNDER THE DAVIS-BACON ACT ARE FORWARDED FOR YOUR CONSIDERATIONS AND INSTRUCTIONS. MOST OF SUPER KLEEN'S EMPLOYEES WERE CLASSIFIED AND PAID AS "JANITORS. AFTER BEING ADVISED BY THE NAVY THAT THE JANITOR WAGE RATE WAS TOO LOW AND THAT IT WOULD HAVE TO PAY THE HIGHER "LABORER" RATE INCLUDED IN THE WAGE DETERMINATION.

B-199252.OM, JUL 22, 1980

PRECIS-UNAVAILABLE

COMPTROLLER GENERAL:

WE ARE FORWARDING THE FILE PERTAINING TO THE APPARENT VIOLATIONS OF THE DAVIS-BACON ACT, 40 U.S.C. 276A, AND THE CONTRACT WORK HOURS AND SAFETY STANDARDS ACT, 40 U.S.C. 327 ET SEQ., BY SUPER KLEEN INDUSTRIAL MAINTENANCE SERVICE CO., WHICH PERFORMED WORK UNDER DEPARTMENT OF THE NAVY, CONTRACT NO. N62472-74-C-0059 AT NAVAL COMPLEX, U. S. NAVAL BASE, PHILADELPHIA, PA.

DETAILS OF THE VIOLATIONS AND ADMINISTRATIVE RECOMMENDATIONS CONCERNING DEBARMENT ARE CONTAINED IN THE ATTACHED INVESTIGATIVE REPORT AND DEPARTMENT OF LABOR TRANSMITTAL LETTER.

WE PROPOSE, WITH YOUR APPROVAL TO DISBURSE THE $36,363.00 ON DEPOSIT HERE TO THE 46 AGGRIEVED WORKERS, ON A PRO RATA BASIS, IN ACCORDANCE WITH ESTABLISHED PROCEDURES. OUR PROPOSAL AND THE MATTER OF WHETHER THE CONTRACTOR'S NAME SHOULD BE PLACED ON THE DEBARRED BIDDERS LIST FOR VIOLATIONS UNDER THE DAVIS-BACON ACT ARE FORWARDED FOR YOUR CONSIDERATIONS AND INSTRUCTIONS.

FOR FURTHER INFORMATION, PLEASE CONTACT GLENN WOLCOTT ON EXTENSION 53218.

INDORSEMENT

ASSOCIATE DIRECTOR, FGMS DIVISION-CLAIMS GROUP

RETURNED. TMW (TOWNE AND REALTY, INC., WOERFEL CORP., AND MILLER, WALTZ & ASSOCIATES, A JOINT VENTURE) AWARDED A SUBCONTRACT TO SUPER KLEEN INDUSTRIAL MAINTENANCE SERVICE CO., INC. (SUPER KLEEN), FOR THE PERFORMANCE OF FINAL CLEANUP OPERATIONS ON FAMILY HOUSING UNITS BEFORE ACCEPTANCE OF THESE UNITS BY THE NAVY. SUPER KLEEN PAID ITS EMPLOYEES WAGE RATES AS ESTABLISHED BY A COLLECTIVE BARGAINING AGREEMENT BETWEEN SUPER KLEEN AND THE SERVICE EMPLOYEES INTERNATIONAL UNION, LOCAL 36, AFL- CIO.

MOST OF SUPER KLEEN'S EMPLOYEES WERE CLASSIFIED AND PAID AS "JANITORS," A CLASSIFICATION INCLUDED IN THE ABOVE-MENTIONED COLLECTIVE BARGAINING AGREEMENT, BUT NOT INCLUDED IN THE WAGE DETERMINATION FOR THE FAMILY HOUSING UNIT CONTRACT. AFTER BEING ADVISED BY THE NAVY THAT THE JANITOR WAGE RATE WAS TOO LOW AND THAT IT WOULD HAVE TO PAY THE HIGHER "LABORER" RATE INCLUDED IN THE WAGE DETERMINATION, SUPER KLEEN AND TMW REQUESTED THAT THE NAVY AUTHORIZE AN ADDITIONAL CLASSIFICATION, "JANITORIAL CLEANER." THE NAVY DENIED THIS REQUEST, TAKING THE POSITION THAT THE CLEANUP OPERATION WAS THE LAST PHASE OF A CONSTRUCTION PROJECT COVERED BY THE DAVIS-BACON ACT AND, THEREFORE, THE WORK BY SUPER KLEEN'S EMPLOYEES WAS COVERED BY THE ACT. SUPER KLEEN ARGUES THAT NOT ONLY IS THE WORK PERFORMED UNDER THE SUBCONTRACT (WASHING WINDOWS AND DOOR FRAMES, CLEANING AND WAXING FLOORS, DUSTING, AND CLEANING OF WASHROOMS AND KITCHEN APPLIANCES) NOT COVERED BY THE DAVIS-BACON ACT, BUT THAT THE WORK DOES NOT COME WITHIN THE WORK DESCRIBED IN THE WAGE DETERMINATION AS "LABORER'S" WORK. ALSO, SUPER KLEEN ARGUES THAT THE WAGE RATE ESTABLISHED BY THE DEPARTMENT OF LABOR IS ERRONEOUS. ON APPEAL, THE DEPARTMENT OF LABOR CONCURRED WITH THE NAVY'S POSITION.

THE DAVIS-BACON ACT REQUIRES THAT THE 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 WORK SHALL CONTAIN A PROVISION SETTING FORTH THE MINIMUM PREVAILING WAGE RATE TO BE PAID LABORERS AND MECHANICS AS DETERMINED BY THE SECRETARY OF LABOR, REGARDLESS OF WHETHER THEY ARE EMPLOYED BY THE CONTRACTOR OR A SUBCONTRACTOR. THE CONTRACT IN THE PRESENT CASE WAS FOR THE CONSTRUCTION OF 350 FAMILY HOUSING UNITS AT THE UNITED STATES NAVAL BASE IN PHILADELPHIA, PENNSYLVANIA, AND WAS SUBJECT TO THE DAVIS-BACON ACT. ONE OF THE CONTRACT REQUIREMENTS WAS THAT THE UNITS BE CLEANED. THUS, THE CLEANING PERFORMED BY SUPER KLEEN WAS THE LAST PHASE OF THE CONSTRUCTION AND AN INTEGRAL PART OF THE CONTRACT REQUIREMENTS. THEREFORE, WE MUST CONCLUDE THAT SUPER KLEEN'S SUBCONTRACT WAS SUBJECT TO THE DAVIS-BACON ACT. WE DO NOT DISPUTE THE STATEMENT BY SUPER KLEEN THAT IF THE GOVERNMENT WERE TO CONTRACT SOLELY FOR THE TYPE OF WORK PERFORMED BY SUPER KLEEN, THE CONTRACT WOULD BE SUBJECT TO THE SERVICE CONTRACT ACT RATHER THAN THE DAVIS-BACON ACT. HOWEVER, SINCE THE WORK PERFORMED BY SUPER KLEEN IN THE PRESENT CASE IS PERFORMANCE OF CONSTRUCTION REQUIREMENTS, WE ARE UNABLE TO CONCLUDE THAT IT IS NOT THE TYPE OF WORK PERFORMED BY GENERAL LABORERS.

REGARDING THE ALLEGATION BY SUPER KLEEN THAT THE WAGE RATE WAS ERRONEOUS, THIS OFFICE, PURSUANT TO JUDICIAL DECISIONS CONSTRUING THE SECRETARY OF LABOR'S AUTHORITY TO MAKE DETERMINATIONS OF PREVAILING WAGES, DOES NOT REVIEW THE CORRECTNESS OF WAGE DETERMINATIONS ISSUED BY THE DEPARTMENT OF LABOR IN SITUATIONS SUCH AS WE HAVE IN THE PRESENT CASE. SEE PAINTING & DRYWALL WORK PRESERVATION FUND, INC., B-197362.2, MARCH 28, 1980, 80-1 CPD 230, AND CASES CITED THEREIN.

ALSO, IN REGARD TO THE REFUSAL BY THE DEPARTMENT OF LABOR TO AUTHORIZE THE ADDITIONAL CLASSIFICATION OF "JANITORIAL CLEANER," IT HAS LONG BEEN THE POSITION OF OUR OFFICE THAT THE REFUSAL OF THE SECRETARY OF LABOR, AS IN THE PRESENT CASE, TO APPROVE THE LISTING OF AN ADDITIONAL CLASSIFICATION OF WORKERS TO HIS WAGE SCHEDULE IS NOT REVIEWABLE BY THE GENERAL ACCOUNTING OFFICE. SEE NELLO L. TEER COMPANY V. UNITED STATES, 348 F2D 533 (1965), UNIVERSAL MECHANICAL ENGINEERING CONTRACTORS, INC., B-190004, SEPTEMBER 28, 1977, 77-2 CPD 238, AND 45 COMP.GEN. 318 (1965).

CONCERNING THE IMPOSITION OF DEBARMENT SANCTIONS, THE DEPARTMENT OF LABOR DID NOT RECOMMEND SUCH ACTION. WE CONCUR IN THIS VIEW. WE DO NOT BELIEVE THAT THE VIOLATIONS BY SUPER KLEEN WERE OF SUCH A WILLFUL NATURE AS TO WARRANT DEBARMENT. SUPER KLEEN PAID ITS EMPLOYEES UNION SCALE FOR SERVICE WORKERS, WHICH IT HAD GOOD REASON TO BELIEVE WAS THE CORRECT WAGE SCALE SINCE IN MOST INSTANCES, I.E., ON CONTRACTS COVERED BY THE SERVICE CONTRACT ACT AND ON REGULAR SERVICE JOBS, IT WOULD HAVE BEEN THE PROPER WAGE RATE. THE VIOLATIONS WERE THE RESULT OF SUPER KLEEN'S FAILURE TO REALIZE THAT WHEN PERFORMING ON A DAVIS-BACON CONSTRUCTION PROJECT, DAVIS- BACON WAGE RATES HAD TO BE PAID, RATHER THAN A DELIBERATE OR WILLFUL INTENT BY SUPER KLEEN TO UNDERPAY ITS WORKERS.

THE FUNDS ON DEPOSIT WITH YOUR OFFICE SHOULD BE DISBURSED ON A PRO RATA BASIS TO THE AGGRIEVED EMPLOYEES IN ACCORDANCE WITH ESTABLISHED PROCEDURES.

DIGEST

1. SUBCONTRACTOR, WHO WAS AWARDED SUBCONTRACT FOR CLEANING OF FAMILY HOUSING UNITS BEFORE ACCEPTANCE OF UNITS BY PROCURING ACTIVITY, MUST PAY ITS EMPLOYEES DAVIS-BACON WAGE RATES EVEN THOUGH FIRM'S COLLECTIVE BARGAINING AGREEMENT (APPLICABLE TO SERVICE WORKERS) CALLED FOR LOWER WAGE RATES, SINCE CLEANING OF HOUSING UNITS WAS LAST PHASE OF CONSTRUCTION AND, THEREFORE, SUBJECT TO DAVIS-BACON ACT.

2. GAO, PURSUANT TO JUDICIAL DECISIONS CONSTRUING SECRETARY OF LABOR'S AUTHORITY TO MAKE DETERMINATIONS OF PREVAILING WAGES, DOES NOT REVIEW CORRECTNESS OF WAGE DETERMINATIONS ISSUED BY DEPARTMENT OF LABOR. ALSO, REFUSAL BY DEPARTMENT OF LABOR TO ADD NEW WORKER CLASSIFICATION TO ITS WAGE DETERMINATION IS NOT REVIEWABLE BY GAO.

3. DEBARMENT OF SUBCONTRACTOR IS NOT WARRANTED SINCE UNDERPAYMENTS WERE RESULT OF SUBCONTRACTOR'S FAILURE TO REALIZE THAT WHEN PERFORMING ON DAVIS -BACON CONTRACT, DAVIS-BACON WAGES HAD TO BE PAID EMPLOYEES, REGARDLESS OF FACT THAT IF GOVERNMENT CONTRACTED SOLELY FOR SAME WORK LOWER SERVICE CONTRACT ACT RATES WOULD BE PAID. THUS, VIOLATIONS WERE NOT RESULT OF WILLFUL INTENT TO UNDERPAY WORKERS SO AS TO WARRANT DEBARMENT.