B-5804, SEPTEMBER 7, 1939, 19 COMP. GEN. 331

B-5804: Sep 7, 1939

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ARE MANDATORY THAT NO COAL SHALL BE PURCHASED BY THE UNITED STATES PRODUCED AT ANY MINE WHERE THE PRODUCER FAILED AT THE TIME OF PRODUCTION TO ACCORD HIS EMPLOYEES THE RIGHTS SET FORTH IN SUBSECTION (A) THEREOF. IT IS NOW FOUND AND DETERMINED IN ACCORDANCE WITH THE SAID ACT. THAT THE CONDITIONS WITH RESPECT TO EMPLOYMENT IN THE MINES OF THE COMPANY ARE SUBSTANTIALLY THE SAME AS WHEN THE FINDING WAS ENTERED. THERE IS NO OBJECTION TO THE REJECTION OF THE LOW BID OF THE SAID COMPANY TO FURNISH COAL. IF THE COMPANY IS NOW COMPLYING WITH THE CONDITIONS OF SECTION 9 AND PROPOSES TO FURNISH COAL PRODUCED IN ACCORDANCE THEREWITH. THERE IS NO AUTHORITY UNDER THE ACT TO REJECT ITS OTHERWISE ACCEPTABLE LOW BIDS.

B-5804, SEPTEMBER 7, 1939, 19 COMP. GEN. 331

ADVERTISING - BIDDERS - QUALIFICATIONS - BITUMINOUS COAL ACT VIOLATIONS THE TERMS OF SECTION 9 OF THE BITUMINOUS COAL ACT OF 1937, 50 STAT. 87, ARE MANDATORY THAT NO COAL SHALL BE PURCHASED BY THE UNITED STATES PRODUCED AT ANY MINE WHERE THE PRODUCER FAILED AT THE TIME OF PRODUCTION TO ACCORD HIS EMPLOYEES THE RIGHTS SET FORTH IN SUBSECTION (A) THEREOF, AND WHERE THE FORMER NATIONAL BITUMINOUS COAL COMMISSION ENTERED A FINDING THAT A PARTICULAR COAL COMPANY HAD VIOLATED THE EMPLOYEE ORGANIZING AND BARGAINING PROVISIONS OF SECTION 9, AND IT IS NOW FOUND AND DETERMINED IN ACCORDANCE WITH THE SAID ACT, THAT THE CONDITIONS WITH RESPECT TO EMPLOYMENT IN THE MINES OF THE COMPANY ARE SUBSTANTIALLY THE SAME AS WHEN THE FINDING WAS ENTERED, THERE IS NO OBJECTION TO THE REJECTION OF THE LOW BID OF THE SAID COMPANY TO FURNISH COAL, BUT IF THE COMPANY IS NOW COMPLYING WITH THE CONDITIONS OF SECTION 9 AND PROPOSES TO FURNISH COAL PRODUCED IN ACCORDANCE THEREWITH, THERE IS NO AUTHORITY UNDER THE ACT TO REJECT ITS OTHERWISE ACCEPTABLE LOW BIDS.

ACTING COMPTROLLER GENERAL ELLIOTT TO THE SECRETARY OF THE INTERIOR, SEPTEMBER 7, 1939:

THERE HAS BEEN RECEIVED YOUR LETTER OF AUGUST 28, 1939, AS FOLLOWS:

BIDS WERE OPENED IN THE PURCHASING OFFICE OF THIS DEPARTMENT ON MAY 18 LAST FOR COAL REQUIRED FOR USE IN THE INDIAN SERVICE. B.T.U. EVALUATIONS HAVE BEEN MADE BY THE BUREAU OF MINES OF THE COALS OFFERED IN THE VARIOUS PROPOSALS AND FREIGHT COSTS FROM THE MINES TO THE VARIOUS INDIAN SCHOOLS AND AGENCIES HAVE BEEN COMPUTED, RESULTING IN A DETERMINATION THAT, FOR A NUMBER OF INDIAN SERVICE POINTS, THE WEST KENTUCKY COAL COMPANY IS THE LOWEST BIDDER.

THIS COMPANY WAS AWARDED TWO COAL CONTRACTS FOR THE INDIAN SERVICE FOR THE FISCAL YEAR 1939 AND IN BOTH OF THEM THE COMPANY AGREED TO COMPLY WITH THE REQUIREMENTS OF THE BITUMINOUS COAL ACT OF 1937. HOWEVER, ON JUNE 28, 1939, THE BITUMINOUS COAL COMMISSION ENTERED AN ORDER, TOGETHER WITH ITS FINDINGS AND CONCLUSIONS, TO THE EFFECT THAT THE CONTRACTOR HAD FURNISHED COAL IN VIOLATION OF SECTION 9 OF THE ACT. AT THAT TIME SHIPMENTS UNDER THE CONTRACTS HAD BEEN COMPLETED AND IT WAS UNNECESSARY TO FILE NOTICE OF TERMINATION OF THE CONTRACTS SINCE THE CONTRACT PERIOD HAD EXPIRED WHEN COPIES OF THE ORDER WERE RECEIVED IN THE DEPARTMENT.

THE MATTER OF AWARDING TO THIS SAME COMPANY UNDER THE BIDS RECEIVED ON MAY 18 THOSE LOTS OF COAL ON WHICH THE COMPANY HAS SUBMITTED THE LOWEST BIDS, HAS BEEN UNDER CONSIDERATION BY THE SOLICITOR FOR THE DEPARTMENT WHO HAS STATED THAT WHILE UNDER THE LAW THERE APPEARS TO BE NO LEGAL OBSTACLE TO SUCH AN AWARD, THERE IS FOR ADMINISTRATIVE DETERMINATION THE QUESTION OF AWARDING TO A COMPANY WHICH HAS ALREADY VIOLATED SIMILAR CONTRACTS. HAS NOW COME TO THE ATTENTION OF THE DEPARTMENT THAT UNDER DATE OF AUGUST 16, 1939, YOU RENDERED A DECISION (B-5383) TO THE POSTMASTER GENERAL IN WHICH YOU DIRECTED THAT THE CONTRACT ENTERED INTO BETWEEN THE POST OFFICE DEPARTMENT AND THE ABOVE COMPANY ON JUNE 1, 1939, BE CANCELED AND TERMINATED FOR A SIMILAR VIOLATION OF THE COAL ACT.

IT WOULD APPEAR THAT LITTLE OR NO RELIANCE MAY BE PLACED ON THE COMPANY'S AGREEMENT TO COMPLY WITH THE LAW AND, UNDER THE CIRCUMSTANCES, I PROPOSE TO REJECT BIDS OF THE WEST KENTUCKY COAL COMPANY AND TO AWARD TO THE NEXT LOWEST BIDDERS UNTIL SUCH TIME AS IT SHALL HAVE BEEN FOUND THAT THE COMPANY IS ACTUALLY OBSERVING THE LAW IN ITS PRODUCTION OF COAL. YOUR ACQUIESCENCE IN THUS PROCEEDING IS REQUESTED.

SECTION 9 OF THE BITUMINOUS COAL ACT OF 1937 IN 50 STAT. 87-88, PROVIDES:

SEC. 9. (A) IT IS HEREBY DECLARED TO BE THE PUBLIC POLICY OF THE UNITED STATES THAT---

(1) EMPLOYEES OF PRODUCERS OF COAL SHALL HAVE THE RIGHT TO ORGANIZE AND TO BARGAIN COLLECTIVELY WITH RESPECT TO THEIR HOURS OF LABOR, WAGES, AND WORKING CONDITIONS THROUGH REPRESENTATIVES OF THEIR OWN CHOOSING, WITHOUT RESTRAINT, COERCION, OR INTERFERENCE ON THE PART OF THE PRODUCERS.

(2) NO PRODUCER SHALL INTERFERE WITH, RESTRAIN, OR COERCE EMPLOYEES IN THE EXERCISE OF THEIR SAID RIGHTS, NOR DISCHARGE OR DISCRIMINATE AGAINST ANY EMPLOYEE FOR THE EXERCISE OF SUCH RIGHTS.

(3) NO EMPLOYEE OF ANY PRODUCER AND NO ONE SEEKING EMPLOYMENT WITH HIM OR IT SHALL BE REQUIRED AS A CONDITION OF EMPLOYMENT TO JOIN ANY ASSOCIATION OF EMPLOYEES FOR COLLECTIVE BARGAINING IN THE MANAGEMENT OF WHICH THE PRODUCER HAS ANY SHARE OF DIRECTION OR CONTROL.

(B) NO COAL (EXCEPT COAL WITH RESPECT TO WHICH NO BID IS REQUIRED BY LAW PRIOR TO PURCHASE THEREOF) SHALL BE PURCHASED BY THE UNITED STATES, OR BY ANY DEPARTMENT OR AGENCY THEREOF, PRODUCED AT ANY MINE WHERE THE PRODUCER FAILED AT THE TIME OF THE PRODUCTION OF SUCH COAL TO ACCORD TO HIS OR ITS EMPLOYEES THE RIGHTS SET FORTH IN SUBSECTION (A) OF THIS SECTION.

(C) ON THE COMPLAINT OF ANY EMPLOYEE OF A PRODUCER OF COAL, OR OTHER INTERESTED PARTY, THE COMMISSION MAY HOLD A HEARING TO DETERMINE WHETHER ANY PRODUCER SUPPLYING COAL FOR THE USE OF THE UNITED STATES OR ANY AGENCY THEREOF, IS COMPLYING WITH THE PROVISIONS OF SUBSECTION (A) OF THIS SECTION. IF THE COMMISSION SHALL FIND THAT SUCH PRODUCER IS NOT COMPLYING WITH SUCH PROVISIONS, IT SHALL CERTIFY ITS FINDINGS TO THE DEPARTMENT OR AGENCY CONCERNED. SUCH DEPARTMENT OR AGENCY SHALL THEREUPON DECLARE THE CONTRACT FOR THE SUPPLY OF THE COAL OF SUCH PRODUCER TO BE CANCELED AND TERMINATED.

(D) NOTHING CONTAINED IN THIS ACT OR SECTION SHALL BE CONSTRUED TO REPEAL OR MODIFY THE PROVISIONS OF THE ACT OF MARCH 23, 1932 (CH. 90, 47 STAT. 70), OR OF THE ACT OF JULY 5, 1935 (CH. 372, 49 STAT. 449), KNOWN AS THE NATIONAL LABOR RELATIONS ACT, OR OF ANY OTHER ACT OF CONGRESS REGARDING LABOR RELATIONS OR RIGHTS OF EMPLOYEES TO ORGANIZE OR BARGAIN COLLECTIVELY, OR OF THE ACT OF JUNE 30, 1936 (CH. 881, 49 STAT. 2036).

THE TERMS OF SAID SECTION ARE MANDATORY THAT NO COAL SHALL BE PURCHASED BY THE UNITED STATES PRODUCED AT ANY MINE WHERE THE PRODUCER FAILED AT THE TIME OF PRODUCTION OF SUCH COAL TO ACCORD HIS OR ITS EMPLOYEES THE RIGHTS SET FORTH IN SUBSECTION (A) OF SECTION 9 OF SAID ACT. IT IS A QUESTION OF FACT WHETHER THE WEST KENTUCKY COAL CO. AT THE TIME OF THE PRODUCTION OF THE COAL TO BE DELIVERED ACCORDED TO ITS EMPLOYEES THE RIGHTS STATED IN SECTION 9 OF THE ACT. SINCE IT WAS FOUND ON JUNE 28, 1939, BY THE FORMER BITUMINOUS COAL COMMISSION THAT THIS COMPANY HAD VIOLATED SECTION 9 OF THE ACT, YOU ARE ADVISED THAT THIS OFFICE WILL NOT BE REQUIRED TO OBJECT TO THE REJECTION OF THE BID OF SAID COMPANY IF IT NOW BE FOUND AND DETERMINED IN ACCORDANCE WITH THE BITUMINOUS COAL ACT OF 1937 THAT THE CONDITIONS WITH RESPECT TO EMPLOYMENT IN THE MINES OF THE WEST KENTUCKY COAL CO. ARE SUBSTANTIALLY THE SAME AS WHEN THE ORDER OF JUNE 28, 1939, WAS ENTERED BY THE FORMER BITUMINOUS COAL COMMISSION. HOWEVER, IF THE WEST KENTUCKY COAL CO. IS NOW COMPLYING WITH THE CONDITIONS OF SECTION 9 OF THE BITUMINOUS COAL ACT OF 1937, AND PROPOSES TO FURNISH COAL PRODUCED IN ACCORDANCE THEREWITH, THERE APPEARS NO AUTHORITY UNDER THE ACT TO REJECT ITS LOW BIDS, IF OTHERWISE ACCEPTABLE.