B-201219.OM, MAR 30, 1981

B-201219.OM: Mar 30, 1981

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DIVISION OF FINANCIAL AND GENERAL MANAGEMENT STUDIES 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 CONSIDERATION AND INSTRUCTIONS. THERE ARE THE CLASSIFICATION VIOLATIONS. WORKERS WERE CLASSIFIED AND PAID AS "APPRENTICES" OR "TRAINEES. " WHEN THE EVIDENCE INDICATES THAT THEY SHOULD HAVE BEEN CLASSIFIED EITHER AS "LABORERS" OR "CARPENTERS" AND PAID AS SUCH SINCE THEY PERFORMED WORK GENERALLY PERFORMED BY THESE TWO CLASSIFICATIONS AND NEITHER THE "APPRENTICE" NOR "TRAINEE" CLASSIFICATION WAS AUTHORIZED.

B-201219.OM, MAR 30, 1981

DIVISION OF FINANCIAL AND GENERAL MANAGEMENT STUDIES

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 LARRIEU BROTHERS DECORATING SERVICE, INC. WHICH PERFORMED WORK UNDER GENERAL SERVICES ADMINISTRATION, CONTRACT NO. GS-05 BCA-0357-SBA AT RAILROAD RETIREMENT BOARD BUILDING, CHICAGO, ILLINOIS.

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 $632.94 ON DEPOSIT HERE TO THE 7 AGGRIEVED WORKERS 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 CONSIDERATION AND INSTRUCTIONS.

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

INDORSEMENT

ASSOCIATE DIRECTOR-AFMD, CLAIMS GROUP:

RETURNED. FOR THE MOST PART, THE VIOLATIONS OF THE DAVIS-BACON ACT BY THE CONTRACTOR, LARRIEU BROTHERS DECORATING SERVICE, INC., FALL INTO TWO CATEGORIES. FIRST, THERE ARE THE CLASSIFICATION VIOLATIONS, I.E., WORKERS WERE CLASSIFIED AND PAID AS "APPRENTICES" OR "TRAINEES," WHEN THE EVIDENCE INDICATES THAT THEY SHOULD HAVE BEEN CLASSIFIED EITHER AS "LABORERS" OR "CARPENTERS" AND PAID AS SUCH SINCE THEY PERFORMED WORK GENERALLY PERFORMED BY THESE TWO CLASSIFICATIONS AND NEITHER THE "APPRENTICE" NOR "TRAINEE" CLASSIFICATION WAS AUTHORIZED. HOWEVER, SINCE THE PAYROLLS WERE NOT FALSIFIED, BOTH THE ERRONEOUS CLASSIFICATIONS AND THE AMOUNTS PAID THE WORKERS BEING INDICATED ON THE PAYROLLS, IT APPEARS THAT THE CONTRACTOR BELIEVED THAT IT COULD HIRE INEXPERIENCED WORKERS AND CLASSIFY THEM AS "APPRENTICES" OR "TRAINEES" EVEN THOUGH IT HAD NO APPROVED APPRENTICE PROGRAM. THEREFORE, WE ARE OF THE VIEW THAT WITH RESPECT TO THESE EMPLOYEES, THE CONTRACTOR'S VIOLATIONS COULD NOT BE CONSIDERED TO BE OF SUCH A WILLFUL NATURE AS TO WARRANT DEBARMENT. SEE B-193560-O.M., MARCH 12, 1979, AND B-195948 O.M., NOVEMBER 5, 1979.

THE SECOND CATEGORY OF VIOLATIONS WAS THE FAILURE BY THE CONTRACTOR TO PAY FRINGE BENEFITS. WE NOTE THAT THE CONTRACTOR STATES THAT IT PAID THE CURRENT CARPENTER'S RATE OF $9.15 PER HOUR AND THAT TWO JOURNEYMEN CARPENTERS, BOTH OF WHOM CLAIMED NOT TO HAVE BEEN PAID FOR FRINGE BENEFITS, STATED THAT THEY RECEIVED $9.15 PER HOUR. HOWEVER, THE WAGE DETERMINATION CALLED FOR A BASIC HOURLY RATE OF $8.30 PER HOUR PLUS $1.115 IN FRINGE BENEFITS. THUS, IT APPEARS THAT THE CONTRACTOR DID PAY AT LEAST PART OF THE FRINGE BENEFITS. SINCE THE CONTRACTOR ADMITTED THAT IT DID NOT PAY ALL OF THE REQUIRED FRINGE BENEFITS AND THE RECORD DOES INDICATE THAT CERTAIN FRINGE BENEFITS WERE NOT PAID, IT COULD BE IMPLIED THAT THESE VIOLATIONS WERE OF SUCH A WILLFUL NATURE AS TO WARRANT DEBARMENT. HOWEVER, WE ARE OF THE VIEW THAT IT IS QUESTIONABLE WHETHER THE RECORD, TAKEN AS A WHOLE, ESTABLISHES THAT THE CONTRACTOR'S ACTIONS WERE OF SUCH A WILLFUL NATURE AS TO WARRANT DEBARMENT. MOREOVER, WE DO NOT BELIEVE DEBARMENT IS WARRANTED FOR THE REASON THAT IT HAS BEEN IN EXCESS OF 6 YEARS SINCE THE VIOLATIONS OCCURRED, AND THIS PERIOD WOULD BE FURTHER LENGTHENED IF WE WERE TO INITIATE DEBARMENT PROCEEDINGS AT THIS TIME, SINCE THE CONTRACTOR WOULD HAVE TO BE ACCORDED DUE PROCESS. THIS WOULD REQUIRE NOTICE AND HEARINGS. SEE B-192682, OCTOBER 17, 1978. THE DEPARTMENT OF LABOR DOES NOT RECOMMEND THE IMPOSITION OF DEBARMENT.

THE FUNDS ON DEPOSIT WITH YOUR OFFICE MAY BE DISBURSED TO THE AGGRIEVED WORKERS IN ACCORDANCE WITH ESTABLISHED PROCEDURES.

ATTACHMENT

DIGEST

CONTRACTOR WHO CLASSIFIED AND PAID WORKERS AS "APPRENTICES" AND "TRAINEES," WHICH WAS NOT AUTHORIZED, IS NOT GUILTY OF WILLFULLY VIOLATING DAVIS-BACON ACT IN REGARD TO THESE EMPLOYEES, SINCE CONTRACTOR DID NOT FALSIFY PAYROLLS, I.E., INCORRECT CLASSIFICATION AND AMOUNTS PAID WORKERS WERE INDICATED ON CERTIFIED PAYROLLS. WHILE CONTRACTOR'S FAILURE TO PAY CERTAIN FRINGE BENEFITS COULD BE CONSTRUED AS WILLFUL VIOLATION OF ACT, DEBARMENT IS NOT WARRANTED, SINCE UNDERPAYMENT WAS MINIMAL AND IT HAS BEEN 6 YEARS SINCE VIOLATIONS OCCURRED AND IF DEBARMENT PROCEEDINGS WERE INITIATED, CONTRACTOR WOULD HAVE TO BE ACCORDED DUE PROCESS WHICH WOULD ENTAIL NOTICE AND HEARINGS. THIS WOULD PROLONG RESOLUTION OF CASE.