B-205560.OM, MAR 9, 1982

B-205560.OM: Mar 9, 1982

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NEITHER SUBCONTRACTOR WILLFULLY DISREGARDED OBLIGATIONS TO EMPLOYEES UNDER DAVIS-BACON ACT AND THERE IS NO PROPER BASIS FOR DEBARMENT OF SUBCONTRACTORS. 2. DEBARMENT OF PRIME CONTRACTOR IS UNWARRANTED WHERE REFUSAL TO MAKE RESTITUTION TO EMPLOYEES WAS BASED UPON CONTROVERSY OVER WHETHER THERE WERE ANY UNDERPAYMENTS AND THE PRIME CONTRACTOR'S LIABILITY TO THE SUBCONTRACTORS' EMPLOYEES FOR UNDERPAYMENTS. 3. IT WILL NOT INSIST UPON ADHERENCE TO THE RULE THAT INDIVIDUAL MEMBERS OF A SUBCONTRACTOR PARTNERSHIP WHO PERFORM WORK AS LABORERES OR MECHANICS BE PAID DAVIS-BACON WAGE RATE. THE COMPTROLLER GENERAL: WE ARE FORWARDING THE FILE PERTAINING TO THE APPARENT VIOLATIONS OF THE DAVIS-BACON ACT.

B-205560.OM, MAR 9, 1982

DIGEST: 1. IN ABSENCE OF WAGE STIPULATIONS IN SUBCONTRACTS, NEITHER SUBCONTRACTOR WILLFULLY DISREGARDED OBLIGATIONS TO EMPLOYEES UNDER DAVIS-BACON ACT AND THERE IS NO PROPER BASIS FOR DEBARMENT OF SUBCONTRACTORS. 2. DEBARMENT OF PRIME CONTRACTOR IS UNWARRANTED WHERE REFUSAL TO MAKE RESTITUTION TO EMPLOYEES WAS BASED UPON CONTROVERSY OVER WHETHER THERE WERE ANY UNDERPAYMENTS AND THE PRIME CONTRACTOR'S LIABILITY TO THE SUBCONTRACTORS' EMPLOYEES FOR UNDERPAYMENTS. 3. ALTHOUGH GAO STATED IN A RECENT DECISION THAT, PENDING ACTION BY THE DEPARTMENT OF LABOR (DOL), IT WILL NOT INSIST UPON ADHERENCE TO THE RULE THAT INDIVIDUAL MEMBERS OF A SUBCONTRACTOR PARTNERSHIP WHO PERFORM WORK AS LABORERES OR MECHANICS BE PAID DAVIS-BACON WAGE RATE; HOWEVER, SINCE DOL REGIONAL OFFICE ADVISED CONTRACTING OFFICE AT TIME OF INVESTIGATION OF UNDERPAYMENTS IN INSTANT CASE THAT THREE PARTNERS OF SUBCONTRACTING FIRM WHO PERFORMED AS CARPENTERS SHOULD BE PAID DAVIS BACON RATE AND DOL HAS TAKEN NO EXCEPTION TO THAT ADVICE IN REFERRING MATTER TO GAO FOR SETTLEMENT, WAGES OF THREE PARTNERS SHOULD BE ADJUSTED ON THAT BASIS.

THE COMPTROLLER GENERAL:

WE ARE FORWARDING THE FILE PERTAINING TO THE APPARENT VIOLATIONS OF THE DAVIS-BACON ACT, 40 U.S.C. 276A, BY BEL-AIR CONSTRUCTION CO., THE PRIME CONTRACTOR AND TRI-CONTRACTORS AND GEORGE WORLEY CONSTRUCTION CO. SUB- CONTRACTORS WHICH PERFORMED WORK UNDER U. S. AIR FORCE CONTRACT NO. F04607 -79-C-0028 AT THE FUEL SYSTEM DOCK BUILDING AT NORTON AFB, CALIFORNIA.

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 $3,864.44 ON DEPOSIT HERE TO THE FIVE 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 ALAN SOON ON EXTENSION 53218.

INDORSEMENT

ASSOCIATE DIRECTOR, AFMD-CLAIMS GROUP

RETURNED. THE DEPARTMENT OF LABOR DID NOT RECOMMEND DEBARMENT OF THE PRIME CONTRACTOR OR THE SUBCONTRACTORS AND WE DO NOT INTEND TO DEBAR THEM. IN THE ABSENCE OF EVIDENCE OF RECORD THAT THERE WERE LABOR STANDARDS PROVISIONS IN THE SUBCONTRACTS, WE CANNOT CONCLUDE THAT THE SUBCONTRACTING FIRMS WILLFULLY DISREGARDED OBLIGATIONS TO EMPLOYEES UNDER THE DAVIS-BACON ACT AND THERE IS NO PROPER BASIS TO DEBAR THEM. B-187640- O.M., MARCH 16, 1977. ALTHOUGH THE PRIME CONTRACTOR REFUSED TO MAKE RESTITUTION TO THE SUBCONTRACTORS' EMPLOYEES, THAT WAS BECAUSE OF A CONTROVERSY OVER WHETHER THERE WERE ANY UNDERPAYMENTS AND THE PRIME CONTRACTOR'S LIABILITY TO THE SUBCONTRACTORS' EMPLOYEES FOR UNDERPAYMENTS. THUS, THERE DOES NOT APPEAR TO HAVE BEEN SUCH A WILLFUL INTENT BY THE PRIME CONTRACTOR TO UNDERPAY THE EMPLOYEES AS TO WARRANT DEBARMENT. SEE B-202240-O.M., JUNE 12, 1981.

RECENTLY, IN T.W.P. COMPANY - RECONSIDERATION, B-196356.2, FEBRUARY 4, 1982, 61 COMP.GEN. , 82-1 CPD , WE STATED THAT, PENDING ACTION BY THE DEPARTMENT OF LABOR, WE WILL NOT INSIST UPON ADHERENCE TO THE RULE THAT INDIVIDUAL MEMBERS OF A PARTNERSHIP, SERVING AS A SUBCONTRACTOR, WHO PERFORM THE WORK OF LABORERS OR MECHANICS ON A PROJECT SUBJECT TO THE DAVIS-BACON ACT ARE COVERED UNDER THE ACT. HOWEVER, SINCE THE DEPARTMENT OF LABOR REGIONAL OFFICE ADVISED THE CONTRACTING OFFICE AT THE TIME THE UNDERPAYMENTS WERE BEING INVESTIGATED ON THE INSTANT CASE THAT THE THREE PARTNERS OF THE SUBCONTRACTING FIRM OF TRI-CONTRACTORS WHO PERFORMED AS CARPENTERS SHOULD BE PAID THE DAVIS-BACON WAGE RATE AND THE DEPARTMENT OF LABOR HAS TAKEN NO EXCEPTION TO THAT ADVICE IN REFERRING THE MATTER TO OUR OFFICE FOR SETTLEMENT, THE WAGES OF THE THREE PARTNERS SHOULD BE ADJUSTED ON THAT BASIS. AS TO THE OTHER SUBCONTRACTOR, WORLEY CONSTRUCTION CO., THE RECORD SHOWS THAT RATLIFF, ONE OF ITS THREE EMPLOYEES, WAS PAID IN FULL. THE WAGES OF THE OTHER TWO WORLEY EMPLOYEES SHOULD BE ADJUSTED IN ACCORDANCE WITH ESTABLISHED PROCEDURES.